Fourth, HotSchedules Merge With End-to-End Restaurant Platform in Mind
Ben Hood, CEO of Fourth and HotSchedules
Ask a restaurant general manager how the technology sea change is affecting them, and they’ll show you the incredible new tools at hand—as soon as they remember the password.
“Managers on average have 14 to 15 passwords, it’s very unsustainable. We also know that restaurant companies have 30 to 40 different providers in technology, whether its point of sale or menu or scheduling, whatever it is, that’s a lot,” said Ben Hood, CEO of Fourth and now HotSchedules.
Solving that was the original vision of Fourth, to be a restaurant-operations platform. Since it was founded in 1999, it’s grown to encompass about 1,000 operators mostly in the U.K. Those operators tapped into inventory management, pricing, recipes, allergen information as well as some labor management. In the same year, HotSchedules was founded with a laser focus on labor management and a few ancillary extras. It grew to 6,000 to 7,000 clients, according to Hood, who said bringing them together expanded on the original platform pedigree.
“Fourth has offers around payroll and analytics, a number of products that HotSchedules hasn’t to date brought to the marketplace. And many of our U.K. clients are asking for better scheduling,” said Hood. “Both businesses are focused on what are the next challenges, how do we migrate and how do we help. I think the beauty of the whole platform is that it works seamlessly together to dive more efficiency and accuracy.”
Hood said Fourth sees an average improvement of 2 percent on gross margins, and a similar improvement with HotSchedules on average. And there are unmeasured benefits of simplicity since the team or the manager doesn’t have to juggle the various services and get them to talk to each other. And that does lead to potential savings on fees by using single platform instead of paying $50 here and $100 there on various software services. Currently, Hood said the combined platform has 55 connected services to extend beyond the core offering.
According to operators who spoke at the 2019 Restaurant Finance and Development Conference, the platforms proved truly beneficial for the labor line.
Mike Stringer, of the Casual Dining Group in the U.K., said better scheduling with HotSchedules took the guesswork out of scheduling and helped show managers what they were actually doing with charts.
“They have a lunch peak and bring in more people as if they’re surprised customers are there. Then they keep people a little longer to clean up the mess they’ve made,” said Stringer. “You can visually show them what they’re doing.”
He said it’s meant deploying labor correct so that his restaurants are prepared for the peaks and the valleys. It helped the company get “to the point where labor drives sales instead of sales driving labor,” said Karina Coen, of Fourth and HotSchedules.
At the non-franchised PF Chang’s, it was a boon for the labor line but also kept labors from getting too stressed out with the incredible amount of data flowing through the technology tools, via email and every which way.
“We overwhelmed our team with lots of spreadsheets early on. We had data, but sharing it was hard,” said Candice Barnett, a senior director at the company. “You end up with stressed managers. They show up with however many email reports form the home office or area directors or regional leaders.”
But they still have their job of actually running the restaurants.
“It’s overwhelming and too much and people just shut down after a while,” said Barnett. “Operators execute that’s their job to go in and execute.”
She said creating a labor template with all those reports and data to actually help the managers see what an ideal shift might look like, with a little leeway for on-the-spot decisions. She said in this era of high turnover, it helped when mangers had to fill in at other locations too.
“Even if I’m an excellent operating partner and I go from location A to location C, how am I supposed to know what happens in this new location,” said Barnett. “You didn’t before you had this, it might have taken a year as a good operator to get up to speed.”
Overall, she said the HotSchedules tools helped shed 1 to 1.5 percent from the labor line and helped keep managers sane (and around).