Tanda Blog: Events & Media

Events & Media

Greens MP introduces franchise wages bill

A new bill called the Fair Work Amendment (Recovery of Unpaid Amounts for Franchisee Employees) Bill 2015 was introduced to Parliament last week. The bill, sponsored by Melbourne Greens MP Adam Bandt, is a direct response to the recent 7-Eleven saga, in which the Fair Work Ombudsman has already found over $600,000 in underpaid wages […]

Why we chose Fortitude Valley over Silicon Valley

We loved Alan Downie’s recent piece on why Macropod kept their startup in Australia, it resonated well with similar conversations we’ve had at Tanda. We started Tanda because we wanted to make it easier for a bar we liked to pay their staff. 3 years on it’s great that we’ve been able to solve that […]

How to fuel your startup with Steve Baxter

  Last week Tanda sat down for a chat with Steve Baxter. We talked about some issues that matter to Tanda, and similarly issues that matter to a lot of other startups out there. Here’s a few gems of wisdom Steve had to offer when you begin to consider how you’re going to keep your […]

‘Tanda rewarded for making timesheets sexy’ says Digital Brisbane

Brisbane-based start-up Tanda may be young in business terms, just two years old and with an average employee age of 23, but its meteoric growth has been achieved in a number of ways. Initially it was the no-guts, no-glory approach by its four youthful directors, followed by the whole team’s obsessive client focus. And then […]

What does the new wage increase mean for your business?

The Fair Work Commission has announced the Australian minimum wage will be increased by 2.5% starting 1st July 2015. The 1.86 million lowest paid workers will get a $16 a week pay rise. Tanda used its own labour cost reporting system to measure the expected effects this will have on local businesses and found startling […]

Hackathons and selfie comps – A typical Tanda weekend

This article is about the 2015 event. Go to hack.tanda.co for 2016’s event details! From selfie competitions to interesting discoveries – TandaHQ was buzzing with a crowd of people at last weekend’s official Hackathon. After being featured at Business Acumen magazine, and interviewed on ABC Radio it seems web designers, developers and programmers flocked to […]

Tanda says customers are the best investors

Silicon Valley has glamorised capital raising to a point where the amount of money raised factors into how we measure a startup’s success. The greater the cash injection, the better the startup must be; the more likely they are going to be successful. But there are many startups that never raised a cent, are in […]

Tanda featured at Business Acumen Magazine

Tanda, the Australian company that has developed globally successful cloud-based time and attendance systems, is hosting its inaugural Brisbane Open Data Hackathon event on April 17 and 18. Tanda is hosting the Hackathon at its Brisbane headquarters in celebration of the milestone in reaching the 300 client level in Australia alone. That client list impressively […]

Tanda Open Data Hackathon this weekend – 17th & 18th April

This article is about the 2015 event. Go to hack.tanda.co for 2016’s event details! The Tanda Open Data Hackathon is upon us! Programmers, designers and developers are flocking to Brisbane for Tanda’s first Open Data Hackathon. In a digital era where everything is reachable from the click of a button, it’s no surprise there are now […]

Tanda hits 1 Million clock ins!

Tanda has ticked over to 1 MIllion Clock-Ins! That is a lot of people showing up for work. And though we may gripe and grumble about the daily grind, one million clock-ins is something we want you to celebrate with the whole team at Tanda. Tanda has been here to help you. We have helped […]

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How this retailer increased profit by $8.9m from rostering more hours

There has been a lot of speculation on why we are losing retailers so fast. An interesting research piece from the US presented an alternative hypothesis that generalises the issue down to rostering for profit rather than rostering to control costs. For context – If you were given the choice of increasing revenue by 5% or reducing costs by 5% in order to create the most profitable outcome, what would choose? A “back of the hand” calculation would show that reducing costs increases profit more than the equivalent uptick in revenue. Accordingly, most retailers choose option two. This makes sense if you assume the two scenarios are independent of each other, but what if the cost was your employees? This is where the problems arise. For industries like retail, where staff have a direct impact on sales, it’s not as simple of a question as cutting costs to increase profit. In a study led by Professor Marshall Fisher from Wharton, he and his research team constructed a conceptual model from historical data to identify stores within a US-based retail chain that had the highest potential to benefit from increased labour spend. Importantly, the strategy was actually implemented at 168 retail sites over a 26-week period to validate the model, with the retailer electing to implement the strategy further. The result: A near $8.9 million increase in profit of the stores included. The labour cost challenge The challenge in allocating labour budgets lies in the tradeoff between the known immediate payroll cost and the less certain increase in sales that could be achieved with more staff on hand. The researchers point out that retail managers have a tendency to overweigh the decision to reduce the known payroll cost than the less certain increase in sales which could be achieved by allocating additional labour spend. The labour budget death spiral The study highlights the limitation of the most common retail strategy — setting labour budgets as a portion of sales. Fisher points out that this approach creates a circular problem by failing to take into account how store labour spend can positively impact sales, with the worst case leading to a spiraling effect of reduced sales forecasts reducing labour spend which reduces sales further and so on. Quantifying the impact of labour spend on revenue Creating labour budgets that are designed to maximise profit requires retailers to know on a store-by-store basis the correlation between labour-spend and sales. One way to do this is by looking at times when staffing levels deviate from the original schedule. If ten staff were scheduled on a particular day, but on that day only eight turned up, did sales also decrease by the same portion? If not, by how much? If the answer to the above is that sales didn’t decrease at all, the store is likely overstaffed. If there is a measurable impact, the inverse scenario is likely true and the store may be losing sales by being understaffed. This is the same approach used in the study, which found the relationship between random staffing deviations and impacts on sales was statistically significant. Results showed an increase in labour spend pointed to increased sales at varying degrees, depending on known store attributes. Implementing the strategy for profit The study identified stores in a US retail chain which had the highest market potential, making them good candidates for an increased labour spend. The market potential factored in attributes like average basket value and proximity to competitors, which would create scenarios that allow workers to have the highest impact on converting sales. In the study, 168 stores were selected this way, then allocated a 10% increased labour budget over a 26-week period, of which 75% of the increase was actually consumed in practice by the stores. The outcome was a 4.5% increase in revenue at the impacted stores and resulting in a near $8.9 million profit increase. Learning from the strategy The study shows empirically why the common practice of setting labour budgets as a fixed proportion of forecasted revenue is often self-defeating when applied in a retail setting. An opportunity exists to all retailers to leverage this same profit-centric model for defining labour budgets. The data required is available to all retailers however, it may just be a matter of leveraging that information with the right systems. An integrated forecasting strategy that integrates foot traffic, sales, and employee scheduling data is a practical opportunity afforded to retailers of any size to optimise their labour resource allocations. The interesting part is, Fisher’s research is readily available to all retailers who are looking to drift away from the traditional method of fixing labor budget rosters. The next step is to get this method of labour resource allocation battle tested in the Australian markets. Stay tuned. Up next: What is the Contingent Workforce and how can you leverage it in your business?

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