Employee Plans: benefits of tracking staff transactions

Relax with CARDWATCH at workMany communities still don’t track employee transactions with any degree of measure.  Those that do, often just keep paper records and never look beyond managing the individual transactions to the aggregate… to see their value and impact on various financial and operational considerations. In our experience serving senior living communities over the past 24+ years, employee transactions typically represent 25-40% of all transactions by volume*.  Keep in mind that a “transaction” includes no-charge meals (free food that you may not keep track of) and subsidized purchases.  The mindset of many operators has traditionally been “why bother tracking it when we give it away free?”.  This thinking stems from the school of “cost center” mentalities… operators who are not accountable for the profitability of their operation so much as meeting cost or budget projections.

So why track free or subsidized employee transactions?

Cost & Budget Allocation: They have a cost associated to them even if there is no “price”.  Knowing what it costs you specifically to offer this benefit to employees is important for budgeting, forecasting and preparing accurate financial statements.  CARDWATCH allows you to link each employee to the department they work for so that you can accurately allocate the cost of such employee benefits (free or discounted food for example) to the appropriate departmental budgets and NOT have it reflected only in the Food Service budget.

Controls: It’s human nature… we don’t always value that which is free (or perceived to be free). While we hate to admit it, our staff may take advantage of free or subsidized meal programs, helping themselves to more than was budgeted per employee. We also know that if no one is keeping track, it must not matter what or how much we take since no one will notice.

Reporting: Knowing what percentage of sales (and therefore costs) belong to each customer group (Residents vs guests vs staff) helps you to understand your business better.  If you are not tracking sales by customer type, an increase in employee  consumption adds to total food costs that cannot be differentiated from resident food costs.  This ties in with financial metrics such as the average food cost or average food margin per resident when forecasting for future occupancy levels, etc.

  * varies based on ratio of employees to residents

Building Employee Plans in CARDWATCH

CARDWATCH allows users to create a variety of employee spending plans including:

Fixed Meal Plan just like residents (eg. 1 meal per day) either with or without a price associated with it;

Employee Charge Plan  allows staff to accumulate charges within CARDWATCH just like the Resident Charge plan.  Credit limits can be set by plan (default) or by individual.  There are also options for integration to payroll deduction if desired (staff accumulate charges which are exported to the payroll application for deduction on each pay cycle);

Employee PrePaid Plans allow staff to load up their accounts by cash, check or credit card to spend down within the community. When their balance gets low, they can reload.  CARDWATCH also allows for PrePaid accounts to be reloaded automatically through posting a charge to payroll deduction (eg. when the account reaches a threshold balance, a set amount is loaded onto the account with the charge posted to payroll).

Subsidy Plans:  any of the above plan types can also be a subsidy plan, automatically managing discounts, per diems or allowances.  Leaving it up to cashiers or servers to manage discounts for their peers can be a tricky business so by automating this, you gain tighter controls and reduce the potential for errors. With the swipe of the employees ID card, the system determines what discount to apply (if any), what price level to charge and whether Sales Taxes should be applied or exempted. Don’t want to apply discounts across the board? No problem… you can exclude specific items from being discounted in the menu set up!  CARDWATCH can also allocate the subsidized amounts of each transaction to the department for which the employee works, relieving this financial burden from Dining Services. No more free lunches!

Getting Started

Not sure what’s best for your community or where to start?  Just give us a call and we can talk through your scenarios, explain your options and even fire up a web demo of how it would work. Contact Kevin McIntosh @ 1-877-953-7575 ext 101, or get in touch with our Help Desk.

 Introducing employee spending plans can also result in increased revenues as staff enjoy greater convenience of not having to carry their wallet or purse.