If there’s one phrase that sends a shiver down the spine of any hospitality professional, it’s “We need to cut costs.”
Not because saving money is inherently bad—of course, venues need to be profitable—but because too often, the knee-jerk reaction is to cut staff hours. The first casualty of financial panic is always labor, as if reducing service levels, overworking the remaining team, and stretching a venue to its breaking point is some kind of magic bullet for profitability.
It’s not.
Cutting hours indiscriminately doesn’t solve inefficiency. It doesn’t address why the venue is losing money in the first place. More often than not, it’s a short-sighted move that leads to worse service, frustrated guests, and an overworked team that—let’s be honest—will likely start looking for a new job.
If venues want to save money in a way that doesn’t cripple the business long-term, the focus should be on efficiency, inventory control, and operational awareness. Here’s how.
1. Know Where the Money Actually Goes
Most of the time, a venue isn’t losing money because two extra staff were rostered on a quiet Wednesday. The problem is deeper: wastage, theft, over-ordering, poor stock management, or unnecessary expenses hiding in plain sight.
Before slashing payroll, ask:
- What’s the real cost of waste in the venue? If you're throwing away more product than you're selling, you don’t have a staffing issue—you have a stock control issue.
- How tight is the inventory management? Do you actually know how much stock should be on hand at any given time, or is it more of a “Yeah, that looks about right” approach?
- Are there patterns in losses? Is there a gap between what the POS says you’ve sold and what’s actually been used? This is where you find the real leaks.
A properly controlled stock system can save thousands every month—without reducing a single shift.
2. Roster Smarter, Not Cheaper
Rostering is about balance. Cut too many hours, and the team is stretched so thin they can’t keep up. Keep too many on, and labor costs rise unnecessarily. But the solution isn’t always fewer people—it’s the right people at the right times.
- Are you tracking hourly revenue? A proper sales-per-labor-hour breakdown will show you exactly when your staffing levels need adjusting—without blindly slashing hours across the board.
- Does your team know how to work efficiently? It’s not just about having bodies on the floor—it’s about having a team that knows how to move, support each other, and manage peak periods. Sometimes, a small shift in training does more for profitability than a cut in staffing.
3. Stop the “It’s Just One” Mentality
Every venue has this problem—small inefficiencies adding up to a major financial drain. But when things are tight, these “small” losses become the difference between profit and loss.
- Free pouring without control?
- Mishandled comps?
- Untracked wastage?
Fix these leaks before gutting your roster.
4. Train Staff to Think Like Owners
The best way to improve efficiency is to get staff to see the numbers the way management does. When employees understand the cost of over-pouring, unnecessary wastage, or excessive comps, they naturally work more efficiently.
- Make costs transparent.
- Tie efficiency to incentives.
5. Data Over Feelings
Use data to guide choices:
- Track pour costs and loss percentages.
- Monitor sales per labor hour.
- Use weekly reports, not just monthly ones.
The Real Cost of Cutting Hours
Cutting hours is the lazy way out. Fixing inefficiencies takes work, but it’s the only way to build long-term success.
Before cutting hours, take a hard look at waste, inventory control, and operational inefficiencies. Chances are, the money you’re looking for isn’t in the payroll—it’s in the gaps you’ve been ignoring.
