In the fast-paced world of hospitality, controlling labour costs is just as crucial as maintaining food quality. One of the most effective ways to manage staff expenses is by forecasting staff costs and creating rosters based on anticipated sales. Doing this accurately ensures your business operates efficiently, avoids overstaffing, and maximises profit margins.

Labour is typically one of the largest expenses for any restaurant, café, or catering business, often accounting for 25–45% of total sales. Poorly planned rosters can lead to:

• Overstaffing: Paying more in wages than necessary, reducing profitability.

• Understaffing: Slower service, increased stress on employees, and potential loss of sales.

• Inconsistent scheduling: Employee dissatisfaction, higher turnover, and recruitment costs.

Forecasting staff costs based on projected sales allows you to align your workforce with actual demand, keeping costs in check while maintaining service quality.

How to Forecast Staff Costs

To forecast staff costs effectively, you need to combine historical sales data with labour percentages and staffing requirements. Here’s a step-by-step guide:

1. Review Historical Sales Data

Analyse sales data from the same period in previous years, or at least the last 12 weeks. Look for:

• Daily or hourly sales patterns

• Seasonal fluctuations

• Peak trading days and hours

2. Determine Target Labour Percentage

Most restaurants aim to keep labour costs between 25–35% of sales. Decide on a target percentage based on your business model. For example:

• Quick-service restaurants: 20–25%

• Full-service restaurants: 28–35%

• Cafés or casual dining: 25–30%

3. Calculate Forecasted Staff Costs

Once you have projected sales, calculate your labour budget using the formula:

Labour Cost = Projected Sales × Target Labour Percentage

Example:
If projected sales for a Saturday are $5,000 and your target labour percentage is 30%:

Labour Cost = $5,000 × 0.30 = $1,500

This is the total you can afford to pay staff while maintaining profitability.

4. Allocate Staff Hours

Break down the labour cost into hours based on your team’s wage rates. Use this formula:

Total Staff Hours = Labour Cost ÷ Average Hourly Rate

Example:
If the total labour cost is $1,500 and the average staff wage is $25/hour:

Total Staff Hours = $1,500 ÷ $25 = 60 hours

You can now distribute these 60 hours across your team to match peak trading periods, ensuring you are neither overstaffed nor understaffed.

5. Adjust for Roles and Skill Levels

Remember, not all staff are paid the same. Factor in different wage rates for:

• Chefs/kitchen staff

• Front-of-house staff

• Supervisors or managers

Example:

• 2 chefs × $30/hour × 6 hours = $360

• 3 servers × $22/hour × 6 hours = $396

• 1 manager × $40/hour × 6 hours = $240

• Total cost = $996 for 6 hours of operation

Compare this to your budget and adjust hours or staffing levels if needed.

6. Incorporate Flexibility

Sales forecasts are never perfect. Build in a buffer of 5–10% to accommodate unexpected demand or absences. Using part-time or casual staff can provide flexibility without exceeding your labour budget.

7. Track and Refine

After each shift or week, compare actual sales and staff costs to your forecast. Identify trends and refine your calculations. This continuous feedback loop improves forecasting accuracy over time.

Tools to Simplify Forecasting

Several tools and software solutions can help automate sales-based rostering:

• POS systems with forecasting features

• Rostering software (like Deputy or Tanda)

• Excel or Google Sheets for manual calculations

These tools allow you to link sales data directly to staffing levels, making real-time adjustments easier.

Key Benefits of Sales-Based Rostering

• Reduces overstaffing and unnecessary labour costs

• Ensures sufficient staff coverage during peak times

• Improves employee satisfaction with predictable schedules

• Enhances overall profitability