Success Story

Lumberyard Restaurant Implements New Practices to Cut Labor Costs and Boost Sales

Cary Redfearn has been in the restaurant industry since he was 15. One of his biggest takeaways from years of opening and testing new concepts. "There's no silver bullet to offset the industry's increasing costs. Adapting requires a lot of small changes."

Cary's approach to his current venture reflects that philosophy.

"Profitability in full service restaurants is getting tougher," Cary admitted. "As owners, we have to sit down and decide what we're going to do as the minimum wage increases. Raising menu prices only works to a certain point."

Controlling costs is something Cary understands inside and out, thanks to RestaurantOwner.com.

"I was already looking at costs when RestaurantOwner.com introduced me to the concept of prime costs. The tools and resources were all there and made sense."

The practical, user-friendly resources enabled Cary to build a system that could adapt to fluctuating industry costs. When the new minimum wage laws went into effect, he was ready. He outlined three goals: decrease labor costs, reengineer the menu for savings and increase sales.

"A lot of my team opted for multiple double and triple shifts each week. I didn't want to limit their earnings, but with the minimum wage increase, any overtime became prohibitive. So, we put a cap on scheduling double and triple shifts."

Cary got creative to help offset the income loss of overtime shifts. "You can be the nicest boss in the world, but to attract and keep good people, you need to set them up to make money," he said. "I give my experienced servers larger stations so they can make more money per shift. And I'm frequently on the floor, bussing tables or hosting. The servers appreciate that because they don't need to tip me out at the end of their shift!"

Scheduling isn't the only Lumberyard system that's getting a refresh. Cary and his team have been hard at work reengineering the menu.

"We're looking at how to economize without compromising quality. You can cut items from the menu and your guests will understand. But once you cut corners on quality, that's when you lose customers."

Cary credits RestaurantOwner.com with keeping his perspective fresh. "When you're at your restaurant all the time, you get a feel for what's working and what isn't. But, it's refreshing to see what other operators are doing. RestaurantOwner.com provides that perspective."

Perspective led Cary to challenge some of his own assumptions as he looked for solutions to boost sales. "I'd resisted the idea of delivery because I thought it compromised the food quality. I also thought it incentivized people to stay home instead of coming into the restaurant. Then I realized people who wanted delivery weren't deciding between staying in or going out. They were deciding between The Place That Delivers and The Place That Doesn't. I wanted to capture that market."

The results of the changes are impressive. "When minimum wage increased, our labor costs jumped. The changes we've implemented have stopped the increase. We've actually saved 1.5% in labor costs."

And the reward for being The Place That Delivers? A $1,000 per week increase in sales.

Cary is looking forward to the future. He recently signed a lease on a local historic building that's about 1/5 the square footage of Lumberyard. The goal? To open a fast-casual pizza concept.

"I've always done full-service and I thought I always would. But, now I understand the appeal of fast-casual. The numbers make sense and it's fun. I'm ready to have some fun."