Money Matters

Mastering labor cost control: how multi-unit restaurant operators can leverage Sage Intacct

Labor cost control is a top priority for restaurant operators, particularly those with multiple locations. From hourly wages to payroll taxes, discover how Sage Intacct mitigates the stress of labor cost management with strategy, efficiency, and precision.

January 29, 20265 min read Share

Labor costs are among the most significant expenses in the restaurant industry often representing 25% to 35% of total sales. For multi-unit operators, this challenge is magnified by the complexity of managing multiple locations, diverse staffing needs, and fluctuating customer demand. Rising wages, compliance requirements, and unpredictable scheduling make manual processes and spreadsheets increasingly impractical. To remain competitive and profitable, operators need a smarter approach that combines real-time visibility, automation, and actionable insights. This is where Sage Intacct comes in.

Why labor cost control is critical for multi-unit restaurants

Labor costs encompass more than hourly wages; costs include benefits, payroll taxes, overtime premiums, and compliance-related expenses. When these costs spiral out of control, margins shrink rapidly. Industry benchmarks suggest that prime cost (food + labor) should remain below 60% to 65%, with labor costs ideally between 20% to 30% of sales. Achieving these targets requires precision and agility, especially for operators managing multiple units across different regions.

Failing to control labor costs can lead to cascading issues: reduced profitability, inability to reinvest in growth, and even reputational damage if service quality suffers due to rushed scheduling decisions. In today’s competitive environment, where customer expectations are high and margins are thin, labor cost management is a strategic imperative.

What makes labor cost control hard for multi-unit restaurants?

Managing labor costs across multiple locations is far more complex than running a single-unit operation. Fragmented systems make it difficult for operators to gain visibility, which is why many turn to restaurant franchise accounting solutions designed for multi-location operations.

Here are some of the most common challenges:

• Fragmented data across systems: Most operators rely on separate systems for payroll, POS, and scheduling. These systems rarely integrate seamlessly, creating data silos that make it difficult to get a complete picture of labor performance. Without consolidated data, managers often make decisions based on outdated or incomplete information.
• Manual consolidation and delayed insights: Combining data from multiple locations often involves manual processes, such as exporting spreadsheets and reconciling numbers by hand. This not only consumes valuable time but also introduces errors that can distort labor cost calculations. By the time reports are ready, the opportunity to take corrective action has often passed.
• Forecasting difficulties: Predicting labor needs across diverse units is challenging without advanced analytics. Seasonal fluctuations, local events, and changing consumer behavior all impact staffing requirements. Without accurate forecasting, operators risk overstaffing (which inflates costs) or understaffing (which hurts customer experience).
• Compliance risks: Labor laws vary by state or region, and manual tracking can lead to costly mistakes. Non-compliance with overtime rules, work break requirements, or wage regulations can result in fines and lawsuits, the costs of which far outweigh the cost of implementing a robust system.

How multi-unit restaurants can automate labor cost management

Sage Intacct offers a cloud-based financial management platform designed to simplify complexity and deliver real-time control. Here’s how it addresses these pain points:

• Real-time dashboards for immediate action: Instead of relying on outdated reports, managers can use real-time dashboards to monitor labor KPIs by location, brand, or region. This visibility allows them to take immediate corrective action when costs trend above budget, rather than waiting until the end of the month.
• Dimensional reporting for granular insights: Dimensional reporting enables operators to analyze data by cost center, shift, or job role. This level of detail helps identify inefficiencies, such as locations with excessive overtime or roles that consistently exceed budgeted hours.
• Automated alerts for proactive management: Managers can configure automated alerts to notify them when labor costs exceed predefined thresholds. This proactive approach prevents small issues from becoming major problems.
• Integration with POS and payroll systems: Sage Intacct integrates seamlessly with POS and payroll systems, eliminating manual data entry and ensuring accurate scheduling and forecasting. This integration also reduces errors and saves time, allowing managers to focus on strategic decisions.
• Multi-entity consolidation for faster closings: Closing books across multiple units can be a time-consuming process. Sage Intacct’s multi-entity consolidation feature streamlines this process, enabling operators to compare performance across units without cumbersome spreadsheets.

Practical tips for operators

To maximize the benefits of Sage Intacct, operators should implement several best practices:

• Set smart rules to enforce budgets: Within Sage Intacct, operators can set rules that block miscoded transactions and enforce labor budgets. This reduces errors and ensures financial discipline across all units.
• Leverage statistical accounts for deeper insights: Tracking non-financial metrics such as headcount or average check size provides valuable context for labor efficiency. For example, a location with high labor costs but also high average check size may still be profitable.
• Forecast labor demand using historical data: Combining historical sales data with real-time dashboards helps managers predict labor needs more accurately. This reduces overtime costs and ensures optimal staffing levels during peak periods.
• Automate payroll and accounts payable processes: Automation streamlines workflows, reduces manual errors, and frees up time for managers to focus on strategic initiatives. It also improves compliance by ensuring accurate calculations for overtime and benefits.

Real-world impact

Operators using Sage Intacct report significant improvements in efficiency and profitability. For example, a Burger King franchise reduced its month-end close from 20 days to 10 and improved operational efficiency by 25%. Other multi-unit operators have saved up to 20 hours per month through automated reporting and same-day pricing decisions. These results demonstrate that investing in technology is not just about convenience; it’s about scalability and long-term success.

Beyond cost control: strategic advantages

While controlling labor costs is the primary goal, Sage Intacct offers additional benefits that support broader business objectives. Real-time financial visibility enables operators to make data-driven decisions about menu pricing, marketing campaigns, and expansion plans. Automated workflows reduce administrative burdens, allowing managers to spend more time on customer experience and employee engagement. In short, Sage Intacct transforms labor cost management from a reactive process into a strategic advantage.

Final thoughts

Controlling labor costs is critical for multi-unit restaurant operators striving to maintain healthy margins in a competitive market. Manual processes and fragmented systems are no longer sufficient. By leveraging Sage Intacct’s real-time dashboards, automation, and advanced reporting, operators can gain the visibility and control needed to optimize labor costs and drive long-term success.