What’s the True Cost of Low-Quality Talent?

The temptation to cut corners and trim budgets in hospitality staffing can be alluring, especially when it comes to filling immediate needs with temporary workers.

Yet, is it really a prudent decision to opt for less expensive labor?

Before we answer, let’s delve deeper into both the obvious and concealed costs associated with this choice.

The Tip of the Iceberg: Visible Costs

Just like an iceberg, the immediately evident expenses are merely the fraction that’s above the waterline. When you hire low-quality staff, these costs manifest as:

  • Elevated rates of no-call, no-show incidents
  • High levels of 24-hour cancellations
  • Poor adherence to job descriptions and uniform/presentation standards
  • Lower Return Rates
  • Struggles in meeting job completion deadlines

Such issues not only disrupt your operations but also put undue stress on your existing staff and management.

The Hidden Mass: Concealed Costs

The invisible costs, often overlooked, lurk beneath the surface. They’re the larger part of the iceberg, significantly impacting your business. With lower-quality staffing options, these costs often include:

  • Increased training and supervisory expenses
  • Lower morale among permanent staff
  • Inferior service quality leading to sub-par guest and event experiences
  • Negative online reviews and public ratings
  • Substantial loss of repeat business and revenue

Seemingly small savings from cheaper staffing options can, in reality, end up causing more damage in the long run, reducing productivity, increasing staff turnover, and negatively affecting your bottom line.

So, how can you steer clear of this iceberg?

Navigating Away from the Iceberg

At Upshift, we’ve learnt from hiring 150,000+ W2 hourly workers that there are strong, reliable indicators for quality talent.

We’ve put them together into a checklist to help you bypass the pitfalls of employing low-quality hourly workers:

  • Vetting: Are your candidates assessed in-person?
  • Employee Type: Is your staffing partner providing W2 or 1099 employees? W2 employees often exhibit greater commitment to returning work opportunities and engagement in your operations.
  • Screening: Are background checks and skills verification performed for candidates in person?
  • Motivation: Are workers enthusiastic about working with your business, or are they being assigned indiscriminately?
  • Retention: Is your staffing partner cultivating a dedicated pool of workers that eagerly return?
  • Flexibility: Does your staffing partner offer a flexible team that aligns with your operation?

Investing in high-quality talent brings substantial returns: time and money savings on training and supervision, an enhanced business reputation, and an influx of repeat business.

“The quality of your work is a direct reflection of the quality of your team.”

Danny Meyer – Founder and Executive Chairman, Union Square Hospitality Group; Founder, Shake Shack; Chairman, USHG Acquisition Corp.

These words couldn’t be truer, especially in the hospitality industry, where your team directly interacts with your customers.

The Return on Investment

In the dynamic world of hospitality, the quality of talent can make or break the customer experience. While the allure of cost-cutting through cheaper staffing options may seem tempting, it’s essential to remember the hidden costs.

As we’ve seen these include increased training and supervisory expenses, low staff morale, reduced service quality, negative public perception, and potential revenue loss from diminishing repeat business.

To navigate away from these pitfalls, ensuring your staffing partner meets a set of crucial criteria can be a game-changer. The checklist includes in-person vetting, employee engagement, background checks, worker motivation, retention strategies, and flexibility in aligning with your operation.

Remember, your team is the reflection of your work quality. Opting for high-quality staff not only saves time and money on training and supervision but also enhances your business reputation and drives repeat business.

Investing in quality today will secure a profitable and sustainable tomorrow for your hospitality business.

In our industry, we believe quality isn’t just an option, it’s a necessity!

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