Mastering man power: making every hour count

For dealers, managing costs while maintaining business efficiency is a delicate balancing act. Understanding the factors influencing labour costs is crucial for optimising operations and preventing said costs from spiralling out of control

CREDIT: This is an edited version of an article that originally appeared on When I Work

For small businesses, labour costs can swiftly consume earnings if risk factors aren’t diligently monitored and adjusted. We explore the essential strategies for managing labour costs effectively while maintaining team harmony and avoiding employee dissatisfaction.

Ensure adequate staffing

Making sure that you have enough people on hand and in reserve to handle the amount of business you’re doing (as well as to cover emergencies such as absence) is an important part of preventing costly excess overtime.

Conducting a thorough review of staffing levels in relation to business volume enables you to optimise schedules, ensuring the right number of employees are available to handle the workload effectively.

Make your hours count

A question you may consider if whether your business hours reflect sales and business demand. Make sure having staff on the clock matches up with sales—and that it’s worth paying the additional cost. For example, do you have staff working at the weekend when other businesses may be closed?

Studies across various industries indicate that productivity tends to decrease as employee hours increase. Overworked employees are prone to making mistakes or experiencing accidents on the job, which can result in costly long-term consequences.

Upskill your staff

Implementing effective cross-training can empower a smaller workforce to achieve greater efficiency. Moreover, it enables employees to acquire new skills and broaden their understanding of the business, facilitating their growth alongside the organisation.

Automate some tasks

By incorporating customer management systems and email programs, businesses can automate responses to customer inquiries and outreach to potential clients without requiring an employee to be stationed at a desk.

Automation can also be leveraged to make recruitment, onboarding and sales reporting more efficient. Rather than accepting certain tasks as unavoidable business costs, explore opportunities to optimize employee time spent on essential activities, minimising additional labour costs associated with manual administrative tasks that can be automated.

Create an official overtime policy

Dealers may necessitate overtime from employees for various reasons such as attending industry events or traveling to customers, all of which entail time and cost implications. It’s essential to ensure that rules and policies regarding employee hours and overtime are clearly communicated through a comprehensive policy. Establishing clear boundaries encourages adherence and helps individuals perceive overtime as an exception rather than the norm.

Effectively managing labour costs is essential for dealers. From ensuring accurate staffing levels to aligning business hours with sales demand, and from upskilling employees to leveraging automation, there are various avenues to explore in the pursuit of cost-effective workforce management. With these strategies in place, businesses can navigate the delicate balance between cost management and operational efficiency, setting the stage for sustainable growth and success.