October 11, 2023 • 25 mins
The Pre-Shift Podcast presented by 7shifts is a deep dive into what it takes to run great restaurant teams.
Host D.J. Costantino covers the restaurant industry with conversations featuring industry leaders and innovators sharing their business growth insights, backgrounds, and valuable lessons on running restaurant teams.
On this episode, we’re joined by Ji Hye Kim, Chef/Owner of Miss Kim in Ann Arbor.
Ji Hye was awarded one of Food & Wine's Best New Chefs in 2021 and a multi-time James Beard Award semifinalist. She also advocates for fair wages in the hospitality industry, working with organizations like One Fair Wage to enact change. We get into how staff are paid above the industry average at Miss Kim, the tools Kim uses to get her teams engaged, and more.
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Host & Producer: D. J. Costantino
Producer: Samantha Fung
Editor: Fina Charleston
About 7shifts
7shifts is a scheduling, payroll, and employee retention app designed to help restaurants thrive. With an easy-to-use app and industry-specific solutions, 7shifts saves time, reduces errors, and helps keep costs in check for more than 50,000 restaurants.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
We didn't want a complicated system and we didn't
want any hierarchy, becausethis perceived hierarchy that
you put in between positions orwhatever you make up it, makes
things complicated, difficult tounderstand.
Everybody needs to understandhow they're getting paid.
Speaker 2 (00:20):
Hello and welcome back to another episode of the
Pre-Shift podcast where we divedeep into what it takes to run
great restaurant teams.
I'm your host, dj, and todayI'm sitting down with Ji-Hae Kim
, the chef, owner of Ms Kim andArbor Michigan.
Speaker 1 (00:33):
My name is Ji-Hae Kim .
I'm the chef and managingpartner at Ms Kim Korean
Restaurant in An Arbor, Michigan, where we're part of
Zingerman's community ofbusinesses.
Speaker 2 (00:44):
Ji-Hae was awarded one of Food Wine's best new
chefs in 2021 and is amulti-time James Beard Award
semi-finalist.
Kim is also an advocate forfare wages in the hospitality
industry, working withorganizations like OneFairWage
to enact change.
We get into how staff are paidabove industry average at Ms Kim
, the tools Kim uses to get herteams engaged, and more.
As always, the Pre-Shiftpodcast is brought to you by
(01:05):
SevenGives.
Ms Kim is a part of theZingerman's community of
businesses that began as asingle deli and now includes
nine businesses across An Arboremploying more than 500 people.
Each of the businesses isco-owned by Paul Saginaw and Ari
Weinfacht, the founders whoco-own businesses with managing
partners like Kim.
What this means for therestaurants in the group is a
set of management frameworksthat enable strong, engaged
(01:28):
teams A la Ji-Hae.
Tell you more.
Speaker 1 (01:31):
We have some great tools.
So in big things, we do thingslike open book finance or we did
away with tipped minimum wage,because that's set up to be sort
of an uneven pay system,depending on which department
you work in.
But in a smaller way, it comesdown to frequent communication
(01:56):
and creating an environmentwhere you feel safe enough to
come up with your own opinionsand feedback.
So some of the things that wedo after every shift is this
thing called like best next time, where a person leading the
shift just poses a question toeverybody who's there what was
(02:18):
the best thing that happenedduring the shift?
Well, what did you think thatyou did really well?
And then we have a discussionand then we follow by what do
you think could have been better?
What could we have done better?
So then we're sort of likeproviding that structure to have
a conversation yeah, andeverybody can pitch in to have
(02:41):
the conversation, and it takes alittle bit of practice.
That's why we have to do itevery day and it's actually it's
been the tool that I use themost often and I find it super
useful and it's also easy totrain, to have your staff do it
on their own, and it does somany things.
(03:01):
It provides a place for peopleto speak up, but it also
provides more full, full roundfeedback, not just focusing on
just positive or just negative.
So sort of breaking that ideaof good and bad, positive and
negative.
(03:22):
That binary conversation getsbroken down and then you get
more context because you havemore voices in the room.
So that one I'm really proud of.
And then we meet weekly todiscuss how we're running our
businesses and that's where wediscussed the numbers for open
book finance, any updates, anychanges, and understanding that
(03:48):
our industry is not it's not anoffice based industry, so people
learn information differently.
So we have meetings, we haveweekly meetings, we have emails,
we have in personalannouncement it's posted.
So like understanding people'sdiverse need of communication
and then trying to meet that.
(04:08):
So I think it's important forus rounds.
Speaker 2 (04:12):
Best next time is more of a framework for
conversation that managers andleaders can use.
It's not framed as reporting,it's not written down, but
rather a group conversationstarter.
If there's something ofparticular significance, manager
may include it in the shiftnotes, but the beauty and
effectiveness is that it'scasual.
Speaker 1 (04:29):
Yeah, this is a tool that I recommend everybody
trying it out, just because youknow it starts with.
You know easy, good things, soget people open up to talk about
it and then anything that wastough or challenging that could
have been better.
It's presented in a way thatwhat could have been better for
next time.
So it's not just here are abunch of negative things that
(04:50):
happened, it's it also sort oflike in that simple sentence is
built in like let's activelythink about each one of us what
we could have done better forthe next time.
So it's actually very actionoriented, even though it's it
happens at a deep rate.
Speaker 2 (05:08):
Another one of the tools is open book finance.
Now, we've chatted about openbook finance on podcasts before,
but Kim has her own uniqueperspective on it.
It's something that's doneacross the Zingerman's community
of businesses, but when it cameto miss Kim, she had a
challenge.
Her staff just wasn't all thatinterested at first.
Speaker 1 (05:33):
My experience is that , like I had to like really try
to get them to be engaged enoughfor them to say, like hey, can
we see a cash flow?
Like they're not thatinterested.
So for us, like every singlepiece of information is open, it
doesn't mean it's displayed atall times, every single number.
There's numbers that there arenumbers that we talk about the
(05:55):
more.
And then there are numbers thatare not.
Like it's available if you ask.
So like that, for example, thelow numbers or cash flow numbers
, those are available if you ask, but people just are not that
curious about it.
And then what we have availableand discuss weekly is the stuff
(06:17):
that goes into a profit andmost statement more.
So we I mean, when people firsttry to do open book finance, I
tell them like the fear that wehave as owners is that people
are going to see our bankaccount and like go like oh,
we're totally underpaid, you'remaking bank.
(06:38):
But the reality for most smallbusinesses that we are not
making bank, like the staff aremore surprised how thin the
profit margin is, more than likehow much, how much.
Like they think that we'remaking, like I've heard step one
like that's all we're making orwe're actually not making
profit at all.
(06:58):
That's more of a commonresponse than like we're making
so much money and you're takingadvantage of us by not paying,
like $70,000, $80,000 a year forpart time bus boy position,
like that's just not what I hearand so like you can.
So what I would say is that youcan make the numbers available,
(07:18):
but I think you need to work on, like the, the, the owners and
leaders need to work on theirfears first, because those are
fear-based assumptions, I think,and so, but like having that
set, setting that aside, openbook finance, the key for me
that I know is that you want todiscuss the numbers that staff
(07:40):
can have meaningful impact on,because otherwise it's just, you
know, you're just discussingnumbers and it's not that
interesting.
Speaker 2 (07:50):
Kim also stresses that time is a key ingredient in
successful open book finance.
It's hard for it to matter inthe early days, but as your
business grows and the data ismore robust, provides more
opportunities to engage the team.
There's just more to see andunderstand.
Speaker 1 (08:06):
The restaurant has been open for seven years and
it's only very recently that Ifeel that open book finance
practice is really working.
Because when you're startingfrom scratch you have to build
the culture of feelingcomfortable talking about
numbers and Understanding whatnumbers we're talking about.
(08:26):
And so like that, going intothat kind of practice and like
earning people's trust that theycan speak freely In a safe
environment, earning theirinterest by getting them engaged
those things are bigger in someways.
And just talking about numbersbecause we're talking about
culture shift.
Speaker 2 (08:47):
One way that Kim fosters a connection between her
team and the numbers.
The impact is another toolcalled gross games.
It sounds like a fear factorspinoff, but we're talking about
gross sales.
Net games just didn't have thesame ring.
Speaker 1 (08:59):
Now I am focusing on Really getting people to
understand, connecting theirexperience for that shift with a
number.
So every day, at the end of theday, we do this thing called
gross games, where I pull outonce all the checks are in, I
pull out my my phone where I getthe report, and I say everybody
(09:23):
gets to ask one question andthen we're gonna take a wild
guess what our gross sales wasfor today.
We chose gross because gross isthe number that you're working
for.
So if somebody yeah, somebodygot a huge discount and that
makes the net sales go down, butgross is the number that you
were, you still serve that, thatthem a full plate of fried
(09:46):
chickens.
So in gross games has a betterring than that in that games,
yeah.
So then all the step will ask aquestion and then they start
thinking about what questions toask.
So they ask things like howmany heads did we have?
How many heads did we have lastSaturday and what was the sales
last Saturday?
How much takeout did we have?
(10:07):
How, what was the most popularitem?
Like, what was the most Likebusiest hour and what was our
sales during that hour?
Speaker 2 (10:14):
or like.
Speaker 1 (10:15):
So they'll add like I didn't work lunch, I wouldn't
you worked in our how was thelunch sales.
So they'll get thoseinformations and then this
they'll start making educatedguesses and then each person
will say I think we did eight,nine or eight, four or yeah.
So everybody takes a guess andif we ever gets the closest,
(10:35):
gets a free entry on the house,and that's time they work at
their time of choosing.
So then it makes it fun.
I'm coupling that with theweekly weekly staff meeting
where we talk about numbers ingeneral, so trying to make the
numbers a little more fun andalso To make it real, like it's
not just spreadsheet or bargraphs, it's actually real, like
(10:59):
you felt that it was a $9,000,was it really $9,000 day?
So that's been really fun.
Yeah, and then and then we'regonna slowly start working on
like let's, let's try make likeselling the bottles of wine.
Anybody orders more than twoglasses of wine.
We're gonna recommend selling abottle instead of two glasses
(11:23):
and that trains our staff to bebetter salespeople.
And and one thing about Miss Kimis that we are one fair wage
restaurant, so everybody getspaid Above minimum wage, close
to living, like, close to likeit's it's not serving, it's not
tipped minimum wage to cycleregular up way above minimum
(11:45):
wage.
And then it's a tip sharerestaurant, which means that the
servers are working reallybetter as a team, but they're
not necessarily paying attentionto the sales number or the tip
amount as much as thetraditional setup servers from
the traditional setup and theymay not think about increasing
the average check sales.
(12:06):
But this way we're having alittle fun.
We're increasing awareness ofaverage check amount or average
dollar spent per head and thenmaking a game out of like
training salesmanship and thenmaking them feel like they are
actually really capable ofselling and making a difference.
Speaker 2 (12:30):
Just taking a quick break to share an exciting
update from SevenShifts Now.
Usually I don't do this, butit's something our users have
been waiting for for a long time.
I know that.
I don't have to tell you thatrunning payroll is a lengthy
manual process Talking dataentry, multiple systems, cross
referencing, triple checking soI'm excited to announce that
SevenShifts payroll is now hereand available in the United
States.
Now you can schedule youremployees, manage the time clock
(12:52):
, calculate tips and pay yourteam in one app, and when you
make the switch to SevenShiftspayroll, your first three months
are on us.
To learn more, head toSevenShiftscom slash.
Make the switch.
Now back to the show.
As Kim mentioned, ms Kim is aone fair wage restaurant.
One fair wage is a group thataims to eliminate the lower
tipped minimum wage throughadvocacy policy and public
(13:13):
awareness, and Kim is walkingthe talk at her restaurant.
Speaker 1 (13:17):
We've tried a few different iterations and it's
less challenging now, but whenwe started it was very
challenging.
So what we settled on and itworks well for us.
And when I say it works wellfor us, I think it's very
specific to where we areMichigan and Arbor, college Town
, etc.
So we do base pay plus tipshare.
(13:42):
So base pay is anywhere between12 to 14 to $15, depending on
their tenure, quality of theirwork, different levels of
responsibility and then tipsgets pulled once a week and then
it gets divided by the numberof hours you worked.
So if you work 40 hours and Iwork 20 hours, then you get
(14:06):
twice as much tip than I did.
But if I had way moreresponsibility like I was
trained in every station and Iwas doing baby projects or I was
in charge of making sureeverybody does checklist, for
example and I've been there fortwo years then my base pay would
(14:28):
be higher than somebody whojust got hired.
We designed it that way becausewe started out as a no-tip
restaurant, so we had higherwage, no tipped minimum wage and
refusing to accept tips.
And then we realized thatpeople kept wanting to leave
tips and we had complaints aboutpeople not being able to leave
(14:50):
credit card tips.
So philosophically I have a lotof reservations about tipping
system in general.
I think its root in slavery is,at this point, well publicized
and talked about.
But that's on a macro level.
On a micro level, I thought ifmy staff are going to make $1,
(15:14):
$2, $3 more an hour, like whenam I to stand in the way of that
?
So when we started acceptingtips, we had a conversation in a
staff meeting and I asked thestaff how would you like to
divide tips that comes in?
And the things that came out ofthat meeting was that we wanted
it to be easy to understand.
(15:35):
We didn't want a complicatedsystem and we didn't want any
hierarchy, because, like adispersevered hierarchy that you
put in between positions orwhatever you make up, it, makes
things complicated, difficult tounderstand.
Everybody needs to understandhow they're getting paid.
Speaker 2 (15:53):
One of the challenges to the movement is that every
state has its own laws regardingrestaurant minimum wage and how
tips are collected.
Michigan has its own uniquespin and that requires some
adjustments on Kim's part.
Speaker 1 (16:04):
So Michigan law states like no salaried manager
or the house can take the tipsbecause we're doing tips and not
service charged.
And so the credit card otherthan credit card processing fees
for using the credit cardterminals everything gets goes
straight to the staff and it'sdivided by the number of hours
(16:25):
worked, because everybody saw inthe paycheck how many hours
they worked.
I see yeah, and then all theother differences will come from
the base pay.
And then it gets divided byweek and then gets paid per pay
period.
It shows up in the chat clearlywhat your base pay was for week
(16:47):
one, what your tips were forweek one, and then what was for
base paid week two, and thentips week two.
That works well for us.
And then we do that for bothfront of the house and the back
of the house.
Okay, so what ends up happeningis that our front of the house
and the back of the house theyget along super well.
Good, there's, yeah, there's.
(17:07):
I mean there is a physicaldivide just because back of the
house is in the kitchen more,front of the house is more in
the front.
But other than the physicalworking space, the team feels
like the team is the team.
It's not like a divided housein that sense and it's also
easier for me to talk to cooksand train the cooks.
(17:29):
It doesn't just stay at frontof the house because they're the
ones directly dealing withguests, but I can talk to the
cooks and say when your spec isnot up, like up to where we want
it to be, or when you changethe portion sizes to a point
that it's very inconsistent,that impacts the guest
experience and you have to careabout the guest experience.
(17:52):
You should care about itregardless.
You like have now more directconnection to it because half
your paycheck comes from the tip.
Speaker 2 (18:03):
See what you're saying.
So what is back of housegetting tip share versus front
of house?
Is it all equal?
Speaker 1 (18:10):
It's all equal.
So base pay for both front ofthe house and back of the house
is 12 to 15.
And tips gets divided by thesame same just number of hours,
no hierarchy depending on, nodifferent portions depending on
the position or the department.
So it gets straight up dividedthe same way and that adds about
(18:33):
$9 to $10 an hour.
Some rarely goes up to 11, butthose weeks are when we're short
staffed or we're hit withsomething big surprise.
It's surprised.
It's actually very consistent,like it's in that range pretty
consistently.
So once you get over the fearof having some of your pay to be
(18:56):
a little more fluctuating, thefluctuation is small enough that
your pay is actually fairlyconsistent.
And you couple that with likeour HR is through Zinermans, so
you couple that with thebenefits that we offer that
medical, dental, vision, healthsavings account, like pay time
off, it rounds out thecompensation package pretty well
(19:18):
.
Like I wish we can do more, butwe are doing the best we can
for now and I think it's wayabove industry average for now.
Speaker 2 (19:28):
Kim also puts a big focus on guest education when it
comes to tips, wages andoverall staff comp.
Speaker 1 (19:35):
We didn't go back to tip minimum wage but we did have
to make a lot of changes on,like anything, guest spacing on
our website, on our menu, on thecredit card slip, so, and we
had to educate our guests andeducate the staff on how
everything's done, and that waspre pandemic and then we haven't
(19:56):
really made any changes afterthat.
It's like compensation and pathto higher wage has been the
same and how we once we decidedto take credit card tips.
The systems that we set up thenis the same system that we use.
But like it was agonizingconversations when we were
(20:17):
making those changes and thenalso during in the middle of it,
we briefly considered servicecharge during the pandemic when
we were all take out only, butwe decided that a you know, tip
share is working for us.
If I were to open a brand newrestaurant and do it over and it
happens to be full service thenI may consider service charge.
(20:38):
You have to think about pros andcons of doing service charge
instead of tip share versus nottaking tips or service charge at
all.
I think not doing tips orservice charge is very
challenging.
I think it's the mostchallenging.
Probably in most states.
Service charge is more and morecommon and, like, the pros of
(20:59):
doing service charge is that youcan sort of you have more
freedom in deciding how to usethat service charge that's been
collected Tips if you call ittips, then it's going straight
to the staff, but if you doservice charge, then then you
pay taxes on them.
It's not a direct transfer tothe staff.
Yeah, so those are pros andcons For me.
(21:22):
I ultimately decided that Idon't want to do service charge,
I want to do tips, because Iwant it to be really transparent
.
I didn't want to sit there inmy office at the end of the
night going like, oh wow, we got, like you know, $10,000 this
week in service charge.
Maybe I will divide it up thisway or that way, and I just
didn't.
I felt kind of odd about it andthe way that we had set it up
(21:47):
was working fine, so why changeit?
So we didn't.
Speaker 2 (21:54):
All of this contributes to study retention
at Ms Kim and the Zingerman'scommunity at large, but Kim
contends that there's still alot of work to do across the
industry.
Speaker 1 (22:04):
Retention.
It's a challenging thingbecause I think it's an
industry-wide issue that we haveto address, because people may
think of a restaurant job aslike a summer job or part-time
job, but they don't think of itas career.
And I think that's the inherentproblem in like having
(22:26):
difficult time hiring people,because they don't want to stay
long-term, they don't think ofit as career, they want to move
on to next things.
So for me, for my restaurant,the most I can do is, again,
it's a lot to take on for onerestaurant At least an
industry-wide awakening andchanging.
Because if people think thatZingerman's doing like a
(22:49):
revolutionary work by providinghealth insurance, then we're
really behind, really behind,like that should be basic, not
like something that's extra,that you're doing for the people
.
That's a basic level that theemployer should be providing in
the United States.
So for retention, what I do is Itry to create safe environment,
(23:12):
I try to empower people and alllike talking about the open
book, finance and systems andhaving people be able to have
their voice.
Those are all I think goinginto retention.
Some of it is like something Icannot help Like.
Ann Arbor is a college town, sowe see a good amount of change
(23:36):
over at the end of semesterswhen summer breaks start, and
then at the end of summer breakwhen people do move on or new
students come and they'relooking for a part-time job.
So the most I can do forretention is to let everybody
know that it's okay that we talkabout our personal long-term
(23:59):
goals here.
Speaker 2 (24:01):
Going to next year.
Kim is continuing to do thegood work at her restaurant.
She's also working on acookbook, as well as partnering
with Ingemen's to do food toursin Korea.
Speaker 1 (24:10):
Ingemen's food tours and I partner to take people to
Korea and then we're going toexperience the Korean food and
the Korean countryside Like youdon't see in Netflix TV shows on
Korean dramas like Squid Games.
Speaker 2 (24:28):
Kim is also working on a benefit for raised
high-road restaurants, Anotheradvocacy group for fare wages
and increased racial and genderequity in restaurants.
So next time you find yourselfin Ann Arbor, be sure to pay Kim
a visit at a restaurant missKim and check out the rest of
the businesses in the Ingemen'scommunity.
Thank you for checking out thisepisode of the Pre-Shift
(24:49):
Podcast.
If you enjoyed this one, leavea review and share it with one
friend to help the show grow.
We couldn't do it without yoursupport.
As always, I'd love to hearwhat you think.
You can email me atdjats7shiftscom.
You can also find more greatinsights like these on the Seven
Ships blog and across all ofour social channels.
Catch you next time.
We didn't want a complicated system and we didn't
want any hierarchy, becausethis perceived hierarchy that
you put in between positions orwhatever you make up it, makes
things complicated, difficult tounderstand.
Everybody needs to understandhow they're getting paid.
Speaker 2 (00:20):
Hello and welcome back to another episode of the
Pre-Shift podcast where we divedeep into what it takes to run
great restaurant teams.
I'm your host, dj, and todayI'm sitting down with Ji-Hae Kim
, the chef, owner of Ms Kim andArbor Michigan.
Speaker 1 (00:33):
My name is Ji-Hae Kim .
I'm the chef and managingpartner at Ms Kim Korean
Restaurant in An Arbor, Michigan, where we're part of
Zingerman's community ofbusinesses.
Speaker 2 (00:44):
Ji-Hae was awarded one of Food Wine's best new
chefs in 2021 and is amulti-time James Beard Award
semi-finalist.
Kim is also an advocate forfare wages in the hospitality
industry, working withorganizations like OneFairWage
to enact change.
We get into how staff are paidabove industry average at Ms Kim
, the tools Kim uses to get herteams engaged, and more.
As always, the Pre-Shiftpodcast is brought to you by
(01:05):
SevenGives.
Ms Kim is a part of theZingerman's community of
businesses that began as asingle deli and now includes
nine businesses across An Arboremploying more than 500 people.
Each of the businesses isco-owned by Paul Saginaw and Ari
Weinfacht, the founders whoco-own businesses with managing
partners like Kim.
What this means for therestaurants in the group is a
set of management frameworksthat enable strong, engaged
(01:28):
teams A la Ji-Hae.
Tell you more.
Speaker 1 (01:31):
We have some great tools.
So in big things, we do thingslike open book finance or we did
away with tipped minimum wage,because that's set up to be sort
of an uneven pay system,depending on which department
you work in.
But in a smaller way, it comesdown to frequent communication
(01:56):
and creating an environmentwhere you feel safe enough to
come up with your own opinionsand feedback.
So some of the things that wedo after every shift is this
thing called like best next time, where a person leading the
shift just poses a question toeverybody who's there what was
(02:18):
the best thing that happenedduring the shift?
Well, what did you think thatyou did really well?
And then we have a discussionand then we follow by what do
you think could have been better?
What could we have done better?
So then we're sort of likeproviding that structure to have
a conversation yeah, andeverybody can pitch in to have
(02:41):
the conversation, and it takes alittle bit of practice.
That's why we have to do itevery day and it's actually it's
been the tool that I use themost often and I find it super
useful and it's also easy totrain, to have your staff do it
on their own, and it does somany things.
(03:01):
It provides a place for peopleto speak up, but it also
provides more full, full roundfeedback, not just focusing on
just positive or just negative.
So sort of breaking that ideaof good and bad, positive and
negative.
(03:22):
That binary conversation getsbroken down and then you get
more context because you havemore voices in the room.
So that one I'm really proud of.
And then we meet weekly todiscuss how we're running our
businesses and that's where wediscussed the numbers for open
book finance, any updates, anychanges, and understanding that
(03:48):
our industry is not it's not anoffice based industry, so people
learn information differently.
So we have meetings, we haveweekly meetings, we have emails,
we have in personalannouncement it's posted.
So like understanding people'sdiverse need of communication
and then trying to meet that.
(04:08):
So I think it's important forus rounds.
Speaker 2 (04:12):
Best next time is more of a framework for
conversation that managers andleaders can use.
It's not framed as reporting,it's not written down, but
rather a group conversationstarter.
If there's something ofparticular significance, manager
may include it in the shiftnotes, but the beauty and
effectiveness is that it'scasual.
Speaker 1 (04:29):
Yeah, this is a tool that I recommend everybody
trying it out, just because youknow it starts with.
You know easy, good things, soget people open up to talk about
it and then anything that wastough or challenging that could
have been better.
It's presented in a way thatwhat could have been better for
next time.
So it's not just here are abunch of negative things that
(04:50):
happened, it's it also sort oflike in that simple sentence is
built in like let's activelythink about each one of us what
we could have done better forthe next time.
So it's actually very actionoriented, even though it's it
happens at a deep rate.
Speaker 2 (05:08):
Another one of the tools is open book finance.
Now, we've chatted about openbook finance on podcasts before,
but Kim has her own uniqueperspective on it.
It's something that's doneacross the Zingerman's community
of businesses, but when it cameto miss Kim, she had a
challenge.
Her staff just wasn't all thatinterested at first.
Speaker 1 (05:33):
My experience is that , like I had to like really try
to get them to be engaged enoughfor them to say, like hey, can
we see a cash flow?
Like they're not thatinterested.
So for us, like every singlepiece of information is open, it
doesn't mean it's displayed atall times, every single number.
There's numbers that there arenumbers that we talk about the
(05:55):
more.
And then there are numbers thatare not.
Like it's available if you ask.
So like that, for example, thelow numbers or cash flow numbers
, those are available if you ask, but people just are not that
curious about it.
And then what we have availableand discuss weekly is the stuff
(06:17):
that goes into a profit andmost statement more.
So we I mean, when people firsttry to do open book finance, I
tell them like the fear that wehave as owners is that people
are going to see our bankaccount and like go like oh,
we're totally underpaid, you'remaking bank.
(06:38):
But the reality for most smallbusinesses that we are not
making bank, like the staff aremore surprised how thin the
profit margin is, more than likehow much, how much.
Like they think that we'remaking, like I've heard step one
like that's all we're making orwe're actually not making
profit at all.
(06:58):
That's more of a commonresponse than like we're making
so much money and you're takingadvantage of us by not paying,
like $70,000, $80,000 a year forpart time bus boy position,
like that's just not what I hearand so like you can.
So what I would say is that youcan make the numbers available,
(07:18):
but I think you need to work on, like the, the, the owners and
leaders need to work on theirfears first, because those are
fear-based assumptions, I think,and so, but like having that
set, setting that aside, openbook finance, the key for me
that I know is that you want todiscuss the numbers that staff
(07:40):
can have meaningful impact on,because otherwise it's just, you
know, you're just discussingnumbers and it's not that
interesting.
Speaker 2 (07:50):
Kim also stresses that time is a key ingredient in
successful open book finance.
It's hard for it to matter inthe early days, but as your
business grows and the data ismore robust, provides more
opportunities to engage the team.
There's just more to see andunderstand.
Speaker 1 (08:06):
The restaurant has been open for seven years and
it's only very recently that Ifeel that open book finance
practice is really working.
Because when you're startingfrom scratch you have to build
the culture of feelingcomfortable talking about
numbers and Understanding whatnumbers we're talking about.
(08:26):
And so like that, going intothat kind of practice and like
earning people's trust that theycan speak freely In a safe
environment, earning theirinterest by getting them engaged
those things are bigger in someways.
And just talking about numbersbecause we're talking about
culture shift.
Speaker 2 (08:47):
One way that Kim fosters a connection between her
team and the numbers.
The impact is another toolcalled gross games.
It sounds like a fear factorspinoff, but we're talking about
gross sales.
Net games just didn't have thesame ring.
Speaker 1 (08:59):
Now I am focusing on Really getting people to
understand, connecting theirexperience for that shift with a
number.
So every day, at the end of theday, we do this thing called
gross games, where I pull outonce all the checks are in, I
pull out my my phone where I getthe report, and I say everybody
(09:23):
gets to ask one question andthen we're gonna take a wild
guess what our gross sales wasfor today.
We chose gross because gross isthe number that you're working
for.
So if somebody yeah, somebodygot a huge discount and that
makes the net sales go down, butgross is the number that you
were, you still serve that, thatthem a full plate of fried
(09:46):
chickens.
So in gross games has a betterring than that in that games,
yeah.
So then all the step will ask aquestion and then they start
thinking about what questions toask.
So they ask things like howmany heads did we have?
How many heads did we have lastSaturday and what was the sales
last Saturday?
How much takeout did we have?
(10:07):
How, what was the most popularitem?
Like, what was the most Likebusiest hour and what was our
sales during that hour?
Speaker 2 (10:14):
or like.
Speaker 1 (10:15):
So they'll add like I didn't work lunch, I wouldn't
you worked in our how was thelunch sales.
So they'll get thoseinformations and then this
they'll start making educatedguesses and then each person
will say I think we did eight,nine or eight, four or yeah.
So everybody takes a guess andif we ever gets the closest,
(10:35):
gets a free entry on the house,and that's time they work at
their time of choosing.
So then it makes it fun.
I'm coupling that with theweekly weekly staff meeting
where we talk about numbers ingeneral, so trying to make the
numbers a little more fun andalso To make it real, like it's
not just spreadsheet or bargraphs, it's actually real, like
(10:59):
you felt that it was a $9,000,was it really $9,000 day?
So that's been really fun.
Yeah, and then and then we'regonna slowly start working on
like let's, let's try make likeselling the bottles of wine.
Anybody orders more than twoglasses of wine.
We're gonna recommend selling abottle instead of two glasses
(11:23):
and that trains our staff to bebetter salespeople.
And and one thing about Miss Kimis that we are one fair wage
restaurant, so everybody getspaid Above minimum wage, close
to living, like, close to likeit's it's not serving, it's not
tipped minimum wage to cycleregular up way above minimum
(11:45):
wage.
And then it's a tip sharerestaurant, which means that the
servers are working reallybetter as a team, but they're
not necessarily paying attentionto the sales number or the tip
amount as much as thetraditional setup servers from
the traditional setup and theymay not think about increasing
the average check sales.
(12:06):
But this way we're having alittle fun.
We're increasing awareness ofaverage check amount or average
dollar spent per head and thenmaking a game out of like
training salesmanship and thenmaking them feel like they are
actually really capable ofselling and making a difference.
Speaker 2 (12:30):
Just taking a quick break to share an exciting
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I know that.
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SevenShifts payroll is now hereand available in the United
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Now you can schedule youremployees, manage the time clock
(12:52):
, calculate tips and pay yourteam in one app, and when you
make the switch to SevenShiftspayroll, your first three months
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To learn more, head toSevenShiftscom slash.
Make the switch.
Now back to the show.
As Kim mentioned, ms Kim is aone fair wage restaurant.
One fair wage is a group thataims to eliminate the lower
tipped minimum wage throughadvocacy policy and public
(13:13):
awareness, and Kim is walkingthe talk at her restaurant.
Speaker 1 (13:17):
We've tried a few different iterations and it's
less challenging now, but whenwe started it was very
challenging.
So what we settled on and itworks well for us.
And when I say it works wellfor us, I think it's very
specific to where we areMichigan and Arbor, college Town
, etc.
So we do base pay plus tipshare.
(13:42):
So base pay is anywhere between12 to 14 to $15, depending on
their tenure, quality of theirwork, different levels of
responsibility and then tipsgets pulled once a week and then
it gets divided by the numberof hours you worked.
So if you work 40 hours and Iwork 20 hours, then you get
(14:06):
twice as much tip than I did.
But if I had way moreresponsibility like I was
trained in every station and Iwas doing baby projects or I was
in charge of making sureeverybody does checklist, for
example and I've been there fortwo years then my base pay would
(14:28):
be higher than somebody whojust got hired.
We designed it that way becausewe started out as a no-tip
restaurant, so we had higherwage, no tipped minimum wage and
refusing to accept tips.
And then we realized thatpeople kept wanting to leave
tips and we had complaints aboutpeople not being able to leave
(14:50):
credit card tips.
So philosophically I have a lotof reservations about tipping
system in general.
I think its root in slavery is,at this point, well publicized
and talked about.
But that's on a macro level.
On a micro level, I thought ifmy staff are going to make $1,
(15:14):
$2, $3 more an hour, like whenam I to stand in the way of that
?
So when we started acceptingtips, we had a conversation in a
staff meeting and I asked thestaff how would you like to
divide tips that comes in?
And the things that came out ofthat meeting was that we wanted
it to be easy to understand.
(15:35):
We didn't want a complicatedsystem and we didn't want any
hierarchy, because, like adispersevered hierarchy that you
put in between positions orwhatever you make up, it, makes
things complicated, difficult tounderstand.
Everybody needs to understandhow they're getting paid.
Speaker 2 (15:53):
One of the challenges to the movement is that every
state has its own laws regardingrestaurant minimum wage and how
tips are collected.
Michigan has its own uniquespin and that requires some
adjustments on Kim's part.
Speaker 1 (16:04):
So Michigan law states like no salaried manager
or the house can take the tipsbecause we're doing tips and not
service charged.
And so the credit card otherthan credit card processing fees
for using the credit cardterminals everything gets goes
straight to the staff and it'sdivided by the number of hours
(16:25):
worked, because everybody saw inthe paycheck how many hours
they worked.
I see yeah, and then all theother differences will come from
the base pay.
And then it gets divided byweek and then gets paid per pay
period.
It shows up in the chat clearlywhat your base pay was for week
(16:47):
one, what your tips were forweek one, and then what was for
base paid week two, and thentips week two.
That works well for us.
And then we do that for bothfront of the house and the back
of the house.
Okay, so what ends up happeningis that our front of the house
and the back of the house theyget along super well.
Good, there's, yeah, there's.
(17:07):
I mean there is a physicaldivide just because back of the
house is in the kitchen more,front of the house is more in
the front.
But other than the physicalworking space, the team feels
like the team is the team.
It's not like a divided housein that sense and it's also
easier for me to talk to cooksand train the cooks.
(17:29):
It doesn't just stay at frontof the house because they're the
ones directly dealing withguests, but I can talk to the
cooks and say when your spec isnot up, like up to where we want
it to be, or when you changethe portion sizes to a point
that it's very inconsistent,that impacts the guest
experience and you have to careabout the guest experience.
(17:52):
You should care about itregardless.
You like have now more directconnection to it because half
your paycheck comes from the tip.
Speaker 2 (18:03):
See what you're saying.
So what is back of housegetting tip share versus front
of house?
Is it all equal?
Speaker 1 (18:10):
It's all equal.
So base pay for both front ofthe house and back of the house
is 12 to 15.
And tips gets divided by thesame same just number of hours,
no hierarchy depending on, nodifferent portions depending on
the position or the department.
So it gets straight up dividedthe same way and that adds about
(18:33):
$9 to $10 an hour.
Some rarely goes up to 11, butthose weeks are when we're short
staffed or we're hit withsomething big surprise.
It's surprised.
It's actually very consistent,like it's in that range pretty
consistently.
So once you get over the fearof having some of your pay to be
(18:56):
a little more fluctuating, thefluctuation is small enough that
your pay is actually fairlyconsistent.
And you couple that with likeour HR is through Zinermans, so
you couple that with thebenefits that we offer that
medical, dental, vision, healthsavings account, like pay time
off, it rounds out thecompensation package pretty well
(19:18):
.
Like I wish we can do more, butwe are doing the best we can
for now and I think it's wayabove industry average for now.
Speaker 2 (19:28):
Kim also puts a big focus on guest education when it
comes to tips, wages andoverall staff comp.
Speaker 1 (19:35):
We didn't go back to tip minimum wage but we did have
to make a lot of changes on,like anything, guest spacing on
our website, on our menu, on thecredit card slip, so, and we
had to educate our guests andeducate the staff on how
everything's done, and that waspre pandemic and then we haven't
(19:56):
really made any changes afterthat.
It's like compensation and pathto higher wage has been the
same and how we once we decidedto take credit card tips.
The systems that we set up thenis the same system that we use.
But like it was agonizingconversations when we were
(20:17):
making those changes and thenalso during in the middle of it,
we briefly considered servicecharge during the pandemic when
we were all take out only, butwe decided that a you know, tip
share is working for us.
If I were to open a brand newrestaurant and do it over and it
happens to be full service thenI may consider service charge.
(20:38):
You have to think about pros andcons of doing service charge
instead of tip share versus nottaking tips or service charge at
all.
I think not doing tips orservice charge is very
challenging.
I think it's the mostchallenging.
Probably in most states.
Service charge is more and morecommon and, like, the pros of
(20:59):
doing service charge is that youcan sort of you have more
freedom in deciding how to usethat service charge that's been
collected Tips if you call ittips, then it's going straight
to the staff, but if you doservice charge, then then you
pay taxes on them.
It's not a direct transfer tothe staff.
Yeah, so those are pros andcons For me.
(21:22):
I ultimately decided that Idon't want to do service charge,
I want to do tips, because Iwant it to be really transparent
.
I didn't want to sit there inmy office at the end of the
night going like, oh wow, we got, like you know, $10,000 this
week in service charge.
Maybe I will divide it up thisway or that way, and I just
didn't.
I felt kind of odd about it andthe way that we had set it up
(21:47):
was working fine, so why changeit?
So we didn't.
Speaker 2 (21:54):
All of this contributes to study retention
at Ms Kim and the Zingerman'scommunity at large, but Kim
contends that there's still alot of work to do across the
industry.
Speaker 1 (22:04):
Retention.
It's a challenging thingbecause I think it's an
industry-wide issue that we haveto address, because people may
think of a restaurant job aslike a summer job or part-time
job, but they don't think of itas career.
And I think that's the inherentproblem in like having
(22:26):
difficult time hiring people,because they don't want to stay
long-term, they don't think ofit as career, they want to move
on to next things.
So for me, for my restaurant,the most I can do is, again,
it's a lot to take on for onerestaurant At least an
industry-wide awakening andchanging.
Because if people think thatZingerman's doing like a
(22:49):
revolutionary work by providinghealth insurance, then we're
really behind, really behind,like that should be basic, not
like something that's extra,that you're doing for the people
.
That's a basic level that theemployer should be providing in
the United States.
So for retention, what I do is Itry to create safe environment,
(23:12):
I try to empower people and alllike talking about the open
book, finance and systems andhaving people be able to have
their voice.
Those are all I think goinginto retention.
Some of it is like something Icannot help Like.
Ann Arbor is a college town, sowe see a good amount of change
(23:36):
over at the end of semesterswhen summer breaks start, and
then at the end of summer breakwhen people do move on or new
students come and they'relooking for a part-time job.
So the most I can do forretention is to let everybody
know that it's okay that we talkabout our personal long-term
(23:59):
goals here.
Speaker 2 (24:01):
Going to next year.
Kim is continuing to do thegood work at her restaurant.
She's also working on acookbook, as well as partnering
with Ingemen's to do food toursin Korea.
Speaker 1 (24:10):
Ingemen's food tours and I partner to take people to
Korea and then we're going toexperience the Korean food and
the Korean countryside Like youdon't see in Netflix TV shows on
Korean dramas like Squid Games.
Speaker 2 (24:28):
Kim is also working on a benefit for raised
high-road restaurants, Anotheradvocacy group for fare wages
and increased racial and genderequity in restaurants.
So next time you find yourselfin Ann Arbor, be sure to pay Kim
a visit at a restaurant missKim and check out the rest of
the businesses in the Ingemen'scommunity.
Thank you for checking out thisepisode of the Pre-Shift
(24:49):
Podcast.
If you enjoyed this one, leavea review and share it with one
friend to help the show grow.
We couldn't do it without yoursupport.
As always, I'd love to hearwhat you think.
You can email me atdjats7shiftscom.
You can also find more greatinsights like these on the Seven
Ships blog and across all ofour social channels.
Catch you next time.
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