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What You Should Know About Starting A Restaurant Business

One of the biggest challenges you will face when starting a restaurant business is the lack of qualified labor. With the growth of the food service industry there is a strong demand for qualified workers in an already diminished labor pool.

When starting a restaurant business, it is vital that you develop a comprehensive human resource program. The first step is to compile a job description for each level of employee. This will leave no doubt of what you expect from your employees if you make clear the job’s duties and responsibilities. This should also include any special skills or education you require.

Before starting a restaurant business you should also establish a pay scale for your employees. You may need to do a bit of research to see what other restaurants in the area are paying their employees. It wouldn’t hurt to pay a bit more as an incentive for good employees to stay. Establish a minimum and maximum rate for each position and the rate raises will be given for each. When you start your restaurant business you will most likely need to pay a bit more to bring together a qualified team. Wait staff will be paid a bit less according to tipping procedures.

Each person applying for a job will need to fill out an application. An application is a signed document stating that all information on it is true. Even though they have a resume you will still need them to fill out the application. Below are a few tips to help you find and keep a great staff.

• Hire a good staff– Make sure you take the time to screen your applicants completely. Be sure they understand what you will expect from them, and that they are able to perform the required job. You should always do a background check on potential employees. If you find you are too busy to do this yourself you may want to hire a Human Resource consultant to do this for you when you need to hire.

• Have a good understanding of wage and hour child labor laws– You will need to check with your state’s Department of Labor so that you can be sure you are complying with regulations on minimum wage and what teenagers are allowed to do, and when and how long they can work.

• Report tips properly– The IRS has a form on which tips need to be reported. For any details you can contact the IRS.

• Provide proper training for your employees. If an employee knows their job, they are able to perform it well. This will make yourself and the employee happier, and they will be more confident and more productive. An ongoing training program builds loyalty and will reduce employee turnover. The National Restaurant Association will help you to develop training programs for your employees.

• There are things you should know about the categories of personnel when starting a restaurant business. Manager, Assistant Manager, Cook, Chef, Server, Busboy, Dishwasher, Host, and Bartender, will all have their own category. When your restaurant has just opened, the categories may cross over. You may need your manager to double as a host, or your servers to bus tables, until you are able to hire a full staff. Let employees know from the beginning that they may be asked to perform these tasks if possible. Costs for your entire payroll should come to about 24 to 35 percent of your total sales.

• The Manager– This position is the most important position in your restaurant. The best choice will be someone who has managed one or more restaurants in your area and concept. They will be familiar with local supply sources and methods of acquiring supplies. Your manager should have good leadership skills and the ability to effectively supervise personnel. They should remain firm but friendly and fair with the employees.

If you want to get and keep a quality manager, you will need to pay them a good wage. You can expect to pay a manager with valuable experience $30 to $40 thousand a year plus a bonus. A manager who is just out of school and joining you in an entry level position will earn $22 to $26 thousand a year. If you offer profit sharing you will find it is a great incentive for employees to make your restaurant a success.

• Chefs and Cooks– You will normally hire 2 full time and one part time cook. You want the best cooks you can find. You might ask them to prepare a dish as a part of their interview. A Chef will command a higher salary than a cook, around $660 to $700 a week as apposed to Cooks with plenty of experience who will expect $400 to $500 a week. Part time Cooks can be paid on an hourly basis.

• Servers– The servers that you hire when starting a restaurant business, need to make a good impression and work well under pressure. They are the employees who will have the most contact with the customer, and need to meet their demands while maintaining a pleasant attitude. Servers are usually paid slightly more than minimum wage because they earn most of their income from tips. Make sure your servers are friendly with the customer and have the energy and stamina to do the job well.

Patricia Farnham - Restaurant industry veteran, owner/operator, author and enthusiast. She recently put her considerable expertise (gained from many years of managing other peoples restaurants), to the test. She purchased a failing operation and turned it around quickly. If you're considering starting your own restaurant, or buying an existing operation, there are vital concepts you need to know to make it profitable. Check out her opinions regarding opening a restaurant on her website.