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4 steps to understanding and improving employee retention

by Nicky Budd-Thanos, on April 16, 2019

Did you know that employee turnover rates in the restaurant industry are upwards of 73%? Or that the financial cost of losing one employee can add up to over $5800?

Employee turnover is a fact of life and even the best tactics won't prevent everyone from leaving. The important question is whether you'll be in a position to effectively track and learn from your employee turnover. Read on for four steps for establishing where you stand on employee retention - and how to move forward.

1. Calculate a baseline for your employee retention rate

Before you can improve a metric, you have to first understand where you stand on it. Establishing a baseline will not only give you a sense of how critical this metric is, but will also make it easy to measure how your efforts are working.

First, designate a period of time to drill into. Next, determine how many employees were working for you during this timeframe - let’s say that number is 200. Next, determine how many of these employees left during this timeframe - let’s say that number is 20. Finally, do a bit of simple math: Divide the number of employees who left by the number of employees, and then multiply by 100.

In this case, the equation would be 20/200 x 100 = 10. That means that you had 90% retention of your employees during this timeframe.

2. Understand why people are leaving

Now that you know the numbers around retention, it’s time to dig into the why. You can also start to narrow down the causes of a high turnover rate by holding exit interviews and asking employees why they’ve chosen to leave the company. Keep in mind that not all employees may feel comfortable answering honestly and that some of the feedback may be hard to hear, but you should be able to identify a pattern after several interviews.


It's also time to start asking yourself what may be difficult questions. One common reason employees cite for leaving a company is lack of communication. If your team misses - or never receives - announcements, it can really affect morale, which in turn leads to employees searching for new jobs. With competition among QSRs at an all-time high, it’s easy for employees to make the decision to leave if the workplace environment isn’t what they’re looking for. Are you providing an environment that people want to be a part of?


3. Develop and implement a retention plan

Once you’ve done some work to isolate the turnover causes, you’ll be better equipped to implement a retention plan, a set of guidelines that a company follows to engage employees long-term and reduce turnover. For our top tips on how to think through a retention plan that works for you and your team, check out our post: 8 ideas to improve retention.

4. Keep open, direct lines of communication

With millennials and Gen Z comprising a majority of the QSR workforce, the way in which your workforce communicates has fundamentally changed - and you need to evolve along with it. Bulletin boards in the break room just can’t keep up anymore.


If you think poor communication might be an issue in your company, your retention plan should include an online app like Crew, which makes it easy for supervisors to send important messages directly to their employees’ smartphones, and to ensure that everyone is on the same page.

Analyzing your company’s retention rates and the ways in which you can affect this metric are critical to the success of your business. What are some of the ways you’ve found success in improving employee retention? Let us know on Twitter!

Photo by Jesson Mata on Unsplash

Source: Bureau of Labor Statistics

Topics:Employee EngagementInternal Communications