Hospitality Labour Crisis: Automation as the New Necessity



Across the globe, food service operators are facing steep staff shortages. The Department of Labor recently released the April 2021 Job Openings and Labor Turnover summary and the numbers were worrying.


Workers quitting their jobs increased to new highs of 4 million with a record 5.6% of restaurant workers quitting their jobs in April. On top of that, restaurant job openings increased the most by any industry, adding nearly 350,000 new job openings since March, for a total of 1.34 million job openings in April.

This isn’t the case only for the United States. Similarly in Australia, the labour crisis in hospitality runs deep. The sector has historically been heavily reliant on migrant workers, backpackers and international students to fill vacancies. But with the international border closures in place from March 2020, the sector has seen a drastic fall in the availability of labour.


Even in Singapore, some restaurants have been on the lookout for workers to fill about 1,000 positions as business picked up with the return of dine-in services, but for more than a month, there have been no takers.


In such a challenging time that forces food service operators to take on greater responsibilities with fewer resources and less help available, automation is no longer a luxury for the industry, it’s a necessity.



Unlock more free time


Restaurant management tools free up valuable time that would be otherwise wasted managing stacks of paper invoices or excel spreadsheets to handle important data and insights. Automating invoice management processes enable operators to free up hours of manual data entry every week. The time saved can then be prioritised and reallocated toward responsibilities with a greater impact on the bottom line. Things like innovation (e.g. exploring new revenue streams) and "the human touch" (building stronger relationships with your customers).


Capitalising on accurate data in real-time


The good thing about automation is that operators never have to procrastinate with harnessing data. Previously, operators had to understand what the data that they had in their hands actually meant, and this usually involved having countless excel sheets of tables and formulas. Fast forward to today, automation and the precise data that they provide are easily extracted for the essential need in achieving growth goals and navigating day-to-day decisions. Insights gleaned from reliable datasets enable food service operators to target areas that can help mitigate rising labour costs.

In an era of dealing with constant supply chain disruptions that lead to price fluctuations, it is difficult to keep up with the prices of each and every product that you purchase. However, this step is crucial for all operators because having the upper hand in tracking food costs means that you’re essentially staying on top of your expenses. Leaving the job to food cost tracking software can help you catch these price fluctuations easily and react accordingly. Whether it is negotiating for better prices with suppliers, adjusting menu prices or even relooking at menu offerings every season. The money you save on food costs equates to more budget to cover rising labour costs.


Automation is no longer a Nice-to-Have


Automation tools like FoodRazor help to streamline the entire invoice management process, freeing up the time that staff or accountants spend on menial administrative tasks. According to The PwC Finance Benchmarking Report 2019-20, 30% to 40% of time can be reduced with finance automation and behavioral change. Our clients have reported at least 10 hours of their time saved from manual data-entry every month. This time can be spent more efficiently creating better dining experiences for guests or in the case of accountants, providing more sophisticated advisory services for establishments.

Another key feature of FoodRazor is being able to flag out accurate price increases based on the data from supplier invoices. Establishments can have peace of mind when it comes to making better business decisions because of the data precision. It also becomes a lot easier to identify where they can lower costs without affecting the rest of the operations. In being able to do so, operators gain the flexibility in their budgets to counter escalating labour costs.

While there are quicker options like increasing menu prices to mitigate labour costs, food service operators should look for alternatives rather than passing these costs to consumers. Operators should make use of this opportunity to relook at the current systems they have in place and adopt automation tools that can benefit their operations long term.


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