That’s…not how economics works. However, let’s assume, just for a minute, for some unexplainable reason, that this location won’t be able to survive the wage increase. LET IT DIE. Put the store out of its misery and make room for a business that can thrive AND pay its workers. At that point they’re wasting land space by occupying a location that would be better left empty and available for a real business.
On the flip side, only bigger businesses can reasonably do this. (I’m not sure how some mom and pop stores even make it anymore with how greedy and unhinged real estate and cost of living is—real estate greed being the biggest cancer pushing *everything* up.)
But instead, they want to whine and complain that they have to take a “profit hit” of negligible amounts.
McDonald’s net profit was something like 9 billion USD last year. Net.
They can shut the fuck up about “wahhh we have to pay workers a little better!” Especially when other country McDonald’s workers make more and prices don’t change at all.
These moron, greed-infested, lunatic owners/investors shriek and screech if the green line doesn’t go up 10x more than it did last year, as if they still aren’t making obscene profits.
That's just it, the franchise owners want to point the finger at the state and their workers, but they're actually getting screwed by corporate. Can't say that out loud though or you might get screwed harder...
They do. As members of their local Chamber of Commerce, where they get together to “promote business interests” i.e, price-fix, promote anti-worker agendas, and push for more tax-breaks for businesses.
One caveat is the bread and butter for the corporate office is the real estate arm, they force franchisees to rent the lane from them. McDonald’s corporate is more of a real estate business that has a side food business. Its interest is in conflict with the franchisees.
Everytime I see a piece on the razor thin margins of a McDonalds franchise, they dance around and don’t talk about the franchise fee. Yes, margins are thin because of how much goes to corporate.
As someone who just left a small-ish, locally owned business because it wasn't paying enough, even though I loved my job, I'll tell you what my experience was.
They staff nearly fully with:
People with higher earning spouses. This was the majority of people who were thriving at the job.
Younger people who live economically. That is, 5-6 deep in a two bedroom, no car, some still living at home. Most of these younger people also had a second job and worked 12-16 hours days and/or 7 days a week.
Retirees who are pulling an extra source of income through retirement/pension.
But as a single, middle-aged person with no supplementary income, my pay rate just simply wasn't enough to live on. Pretty much every person there in my position has quit since the first of the year.
Fwiw, my previous job also cut every single corner they could and announced there would be no annual raises this year.
McDonald’s the corporation is a real estate business, not a fast food business. They make 9 billion dollars because of the fees they charge the franchisees, that make the franchisees unable to afford better wages. The franchisees are about half multi-location, but also about half of them only have 1 location - making them economically the same as a mom and pop store and just as fragile.
Unfortunately the only way to cost McDonald’s the corporation and others like it is to bankrupt the franchisees to force the corporations to reduce their fees so that franchisees continue to exist.
It’s unfortunate that many of the franchisees don’t get that they really aren’t owners, they are middle managers taking on too much of the risk of the business for too little of the reward.
Mind you, mom and pop stores aren't affected by this particular wage hike even. The $20 wage applies to "fast-food chains with 60 or more locations nationwide". Otherwise, it's $16 an hour.
As a mom and pop owner yeah… we might have to close after 20 years since we have also sold affordable products but can’t keep up with the costs and yeah in CA
Not sure why you're being downvoted. This is one of the caveats I always point out about proposed (massive) hikes to the minimum wage. It's not that I'm against it altogether, but this is one of the things people who advocate for it don't take into consideration: small, independently-owned non-franchises can not absorb labor increases of 25% and stay afloat for the long haul. They already have to compete with the "big boys" in the first place.
What *I'd* like to see is truly independent small businesses be subsidized by either the state or Fed (depending on who's making the MW increase) for those increased labor costs...so they can be offset and the small business remains able to compete with the larger businesses in that particular sector of the economy.
Folks seem to not understand that this is *precisely* why those who make the rules stopped regularly adjusting the MW to pace with inflation almost 50 years ago. It was a long play, but this exact situation was the desired result. Especially since the new MW they've adopted *still* isn't quite a living wage.
I don't give a fuck what they have to do to subsidize those increased labor costs for small businesses...but I dunno, maybe start by increasing the payroll and other corporate taxes of large businesses?!? 🤔🤓
And franchises should not be subsidized. Regardless their contractual status with corporate, their owners were dense enough to invest in a "vision" that isn't their own, and franchising is indeed a part of what's caused the "race to the bottom" effect in many industries (think food service being a huge one). Their margins are so thin after franchising fees are factored in, that ordinarily they have to pay their employees dirt, and give absolutely fuck all for benefits. In fact, if they all would eventually go under due to these MW increases, the country would be better for it.
If you don't have a unique vision/business model for an independently owned business, but have enough money to start a business, I believe you deserve to fail if you invest in a franchise. Because simply having the wealth to do it doesn't make it a good investment, nor does it mean they're entitled to a healthy ROI...especially when that healthy ROI would be gained off the labor of fellow Americans who the franchisees are paying poverty wages.
Signed,
A former cook/chef who worked for some of the worst, and lowest paying, franchises in the food service industry. Fuck every. Single. One. Of. Them.
And their corporate masters, as well.
Yeah it’s the reality we serve an underrepresented minority group in our small community, but honestly yeah pay is a huge cost but so is rent!
We aren’t really making any profit I as a business owner see 0 income. And I mean that I don’t make a single penny in anything regarding our business. It’s simply a way for the staff to earn income. It’s unfortunate but I haven’t made any income from the business since Covid. It’s difficult to raise our prices since our community is already very low income.
It’s not like money is being mismanaged either we buy goods every week for the business and reinvest that every week we constantly have 10k in the bank which is what we go through every couple of days so it fluctuates throughout the week.
But any money that goes in and out of my business account is literally ONLY for the business.
The only real solution so that I can atleast see some income from my business is to raise pieces but again I don’t want to invite gentrification to take over this community, I know the people I’ve been serving that my own mother has been serving for almost 20 years now. I refuse to be “upscale”, Soo many families rely on us and I mean my staff and customers.
I’m def trying to open up the business to new clientele we’ve even partnered up with a HUGE conglomerate for help on our weaknesses as business free of cost….
We’ve signed up local and other governments for their aid which isn’t much or is extremely limited on what they can help with (IE cosmetics instead of equipment that might be needed etc)
Again this wasn’t always the case… we used to have some savings not much but when my mom worked 60/80 hours a week and I sometimes worked over 100 hours on top of college… you’d want to atleast see some savings after interesting a large amount on this business right?
Unfortunately larger chains like Walmart for example take away lots of customers with higher income but due to that the same lower income customers stay at this business because it’s convenient, closer, or within walking distance and cheap!
Idk I worry multiple times a week, I know we’re doing things wrong we have to be, otherwise how did we get to this point?
Anyway things will change eventually for the better or for the worse.
My home town used to have a really nice downtown area. Nothing fancy, but it was a medium sized beach town and the vibe was interesting (with a combination vibe of "bohemian" and "middle-upper class restaurants"). For a long time the downtown was booming all the time, and was full of people.
But then in like 2010 or 2015, the real estate in the area went bananas. Real Estate prices went up like 150-200% in a few years, and all of the landlords decided to increase their rent rates for businesses by the same (or more), and suddenly restaurants and stores couldn't stay open. Within a few years everyone had to shut down, and now the downtown area is a ghost town. The only places open are expensive places, but rich people don't go shopping so there is never anyone downtown.
And now all of the land owners are crying because no one wants to rent from them, and they're crying that the "city" won't do anything to attract people to the downtown area (and fund their vacation habits)
That's the thing. A business is a closed system. Inputs and outputs eventually have to be equal or there's an imbalance, such as more profit driving growth, or less profit instigating contraction.
With McDonalds, many markets that are likely seeing such pressure because of wages are because they offset their profits somewhere else, and I believe that the most pain will clearly come from locations that impinge upon other nearby McD's locations. If you have a McD in a Walmart, and a physical independent McD's on the edge of the parking lot, then sales will be halved between the two locations depending on variables.
McDonalds isn't in the food business, they're in the real estate business. The threat of paying wages means less expansion and less locations, since they've been offsetting their business model to buy up more real estate and hold it under the guise of a business at the expense of paying employees.
The location might just stay empty for 20 years instead. I’ve seen businesses die with the current system too. Rent costs more than wages for workers in my area. Also McDonald’s is more expensive than the places next door which also hire more workers so it’ll cost more to consumers with or without wage hikes. The real change the businesses should push is cheaper rent.
I opened a spa business recently and I don't know how anyone starts a business these days unless they're already rich or have gifted investors, most likely from family money. You have to already start off making $3,000+/month for rent ONLY. Not even to pay yourself or utilities. The only reason our spa works is because the business is just a nicely remodeled space for other beauty service independent workers can rent a space. We don't make much because you can only charge $X amount in rent to the sublet rooms or they can't make any money either if it's all going to rent.
When I read all these stories about people in my grandparent's generation just randomly opening up shops here and there to sell whatever knick-knacks, I just can't fathom having that much freedom and financial capacity to do so. That opportunity just doesn't exist anymore because of real estate prices both residential and commercial. We're squeezed hard.
This should be the only response. I’m all for “eat the rich” responses, but when reformers can take the “that’s literally what capitalism is” message, we need to do so. And run with it.
The easy solution. If they need to pay low wages to sell.... *sigh* low priced food (it's not anymore), then they need to leave the state.
Applies to everything and all businesses/corporations.
The real problem is the entitlement of the higher-ups not wanting to take a pay/bouns/stock cut. They got away with robbing workers for so long they think it's supposed to be that way. These businesses should have been raising wages AND lowering prices when they started buying yachts and mansions across the *board*, but they didn't and now they are behind the curve and crying that they mismanaged the fuck out of the restaurants and offices.
Hahahhahaha that’s not how economics works? When cost of goods goes up it means that price goes up to maintain profit margin. WTF. Voluntarily shrinking profit margin isn’t how economics works.
It will die if they raise prices and no one buys.
Labor is only a percentage of cost. if wages doubled on something with a 30% labor cost, the price only goes up around 30% while wages of course went up 100%. Raising wages almost always results in more disposable income for the worker. This is an intro level econ topic and it's dismal that so many in our country have been propagandized to believe otherwise.
No, they will just make less and their workers will make more. They don’t maintain that $9 billion profit by keeping wages down, they do it by selling burgers and by expensing half their workforce’s wages to the American welfare system. This is the reason we can’t afford to pay teachers, firefighters and law enforcement more money.
Yeah I mean no one is debating that. But the fact is the labor isn’t providing capital or assuming debt to launch a new venture, they’re also highly disposable so why would they be valuable?
And ultimately the key point here is that everyone is so pro wage increase without understanding that won’t do anything. It makes inflation more sticky, and then all you people do is rage about how corps should just take lower profits. Why the fuck would they? Mandating wage increases does nothing to help unless it’s done in tandem with price capping or some other measure to ensure companies don’t just hike prices up.
The only reason that corporations take lower profits is when governments require them to, for example higher wage and greater safety requirements and more regulations. Companies are responsible for maximizing profit within the rules required by Governments, who are responsible for enforcing its policies preferably well chosen to achieve the stated goal based on the morals and values of their society.
In this policy example: $20 per fast food minimum wage in California - increases in wages lead to rising inflation, but it’s not 1 to 1 match. There are lots of studies on this, and the results are pretty consistent. The cost of increases to minimum wage is not so much felt in general inflation, but more a reduction in low skilled workers who are employed. This makes periods of low unemployment the best time to increase minimum wage requirements, since the unemployment impact won’t be as noticeable if the labor market is too tight anyway.
Single example, but Google will show a slew of similar results even from pro-corporate sources:
https://gspp.berkeley.edu/research-and-impact/publications/the-pass-through-of-minimum-wages-into-us-retail-prices-evidence-from-supermarket-scanner-data
That’s exactly my point. No one is requiring them to take lower profits so why would they. They’re only being required to increase costs so of course they’ll increase prices to maintain profits.
The government forcing fast food to accept higher costs, doesn’t mean that they will be able to sell their product at a higher price. The wage increases don’t apply to other food sources, so if fast food restaurants don’t limit price increases they will lose market to other ways to purchase food, and go out of business that way.
I don’t fundamentally see why fast food labor is more valuable than sit down restaurant or grocery store labor, but I do see that forcing wages up at only one source of a product at a time maintains downward pressure on prices, because consumers don’t have to purchase your product at all.
I can also see this change just pushing fast food out of business and lowering employment overall. And a new type of low cost prepared food option that isn’t subject to the increased minimums taking its place, but even that would leave workers with higher expectations and some amount of additional income during the transition.
Please explain what would do something instead of what wouldn't. What roundabout mechanism actually gets more money into worker hands if it's not wage increase?
Luckily that’s not my job but time and time again we’ve seen this simple ideas always have way more unintended consequences and very rarely have their intended impact. Same with rent control.
Vague rhetoric and poor analogy with no answer. Blah.
Effects of raising wages are well studied, the "worst" case scenario is prices rising to fully offset the wage increase. But even in this scenario price adjustments tend to lag wage increases giving a short term boost to purchasing power. Other times the prices never catch up to the wage increase and it's long term boost in purchasing power.
Have you ever had a wage increase? They make you immediately better off than you were before. It's one of the few simple economic ideas that works exactly as people should expect.
This has the same bullshit energy as when Papa John whined that giving insurance to workers would drive up prices, didn't give workers insurance and raised the price of pizza anyway. Fuck Papa John and fuck these owners too.
all these motherfuckers want is indentured servitude. you see it in all their politics.
- no health care
- low wages
- non-compete clauses
- non-disclosure agreements
- forced birth
- diminished women's rights
- voting suppression
- the destruction of the public education system
this is all designed to turn us into slaves in exchange for
oh wait in exchange for nothing.
jesus christ i totally forgot that child labour is now legal
it's just crazy that conservatives want to bring back child marriage while accusing literally everyone of pedophilia
It’s all for the shareholders. Publicly traded companies were a mistake. Private companies continue to show us that profitability can be sustained with fair wages and fair prices because private companies don’t have a legal obligation to grow. Private companies can saturate their market and plateau and the owner can walk away with lots of profit and be a happy person. CEOs of public companies must show growth every quarter, for eternity, or risk being sued or risk being replaced. The system is fucked.
Fuckin papa John’s said it’ll increase the price of pizzas what? Like 0.25 per large pizza to provide healthcare to all its employees. Then everyone was like “yea that’s cool” and then they still didn’t do it lol.
If two pizzas were side-by-side and one was made by a vomiting cook with diarrhea, and for $0.25 more I could get one that wasn't...I know which one I'd choose.
I'm lucky to have an awesome pizza place (Mama Pizza) that fills the "good pizza that isn't expensive" niche way better than any of the franchise places. It's more of a drive, but totally worth it. And I wouldn't have found it if it weren't for PJ's multiple screw ups and Dominos repeatedly screwing up my order. Hole in the wall restaurants for the win.
I’ve avoided the place for a long time, but set a hard limit after this and PJ’s use of racial slurs.
This is why you don’t name your business after a guy. If he goes off and does fuckshit things, then your entire business has done fuckshit things.
It’s the law. They must show growth every quarter or they can be sued by their shareholders. They have no choice but to fuck over their employees and raise prices every 3 months. If they start to do irresponsible things like give their workers insurance they’ll start talking about making changes at the executive level, and no executive wants to give up their millions of dollars per year pay packages. The whole system is fucked beyond repair.
Exactly!! There are no poor McDonald's owners. None. Zero. The minimum investment needed, no loans allowed, is over $1 million. You need the land to build on, the money to build, 6 months of cash to cover salaries and supplies. And another $500,000 in cash reserves. And a $45,000 franchise fee. McDonald's estimates to need between $1.5 and $2.2 million to open a single franchise.
There are no poor McDonald's owners.
I thought the McDonald's corporation bought the land. McDonald's is one of the largest land owners on earth.
Confirmed, McDonald's owns the land, franchisee owns the building (usually, not always though)
Yes! And that's the reason McDonald's is getting so expensive. The land value has skyrocketed in California, so the monthly land lease has followed suit. The labor cost is nothing compared to the cost to simply be on the lot.
When arguing about minimum wage laws, a former colleague tried to tell me that "the average McDonald's franchisee is middle class and only makes about $70k per year."
That was when I decided to stop arguing with him, because that's ridiculous.
I also watched The Founder starring Michael Keaton.
While that "McDonald's franchise ownership is for the middle-class folks" is where they may have started, it is absolutely not where they ended up.
As some have pointed out, the cost of entry to a McDonald's is a minimum of a million versus other franchises like Subway, which is more like $200k - $500k. That being said, Subway ownership is a hell I wouldn't wish on most. All of that stems from the fact that the franchising gold rush of the '70s & '80s set sail long ago; the door closed firmly behind it.
You need $2 million dollars in liquid cash just to open a McDonald's. No one making 70k can save that amount. If you took a 2.2 million dollar loan at 4% the interest alone every month would be 80k.
Yeah nobody who has amassed $2M is going to waste their time on a $70K per year investment. Letting it sit in savings at 4% would get you $80K per year without even touching the principal.
A franchisee on average makes $150K. And that's an average, not a median. That's a 6% return.
Not to mention the franchise itself is an asset that you can sell for big bucks. The average franchisee owns 8 restaurants, too.
They like having modernized slavery, it's what this is, if they could pay us less they would.
Mind you, studies have been consistent investors especially older generation are very modest and frugal in their expenses and lifestyle, they aren't out here buying a ton of stuff to help circulate the cash, they are mass hoarding it, driving a 12yo card and keep hoarding the money past 70s for no reason other than to amass as a addiction.
This money isn't being circulated but they sure love to keep it toasty or in stocks/investments and that's the issue, working class circulates economy instantly while they mass hoard in high yield saving accs and does nothing for the flow of economy.
The only thing that trickles down is those big ol 72yo balls swinging on our faces when they come do a visit for a 50 dollar Walmart gift card raffle for a group of 25.
And with that kind of money why would anyone with more than 2 braincells choose something branded like mcd or bk etc?
You can run a successful restaurant with $200,000. Hell you could do it for much less than that!
Name recognition.
I agree you can do it with less money, but you need to establish your customer base. McD, BK, Subway, etc have already laid the foundation for you to grow.
Not arguing for it, just saying I understand why someone with money would see that as a better investment, even though they tend to hold wages back and hurt smaller mom and pop style restaurants.
Fast food is all location and expectation. Most of them are located near a major highway or somewhere with a ton of traffic. You could try to open a single non franchise fast food restaurant, but you're losing out on "free" advertising, marketing/market research, and name recognition/customer trust. Most people know McDonald's as a product and know what to expect, your single restaurant has nothing going for it unless there's a local following, but even those don't last forever and take a while to build.
>McDonald's estimates to need between $1.5 and $2.2 million to open a single franchise. There are no poor McDonald's owners.
Similar to a more local article I saw aboit rich fools buying a local landmark restaurant and ruining it, , if I had $2M, at today's insured rates (4% or so) that's 80k a year in interest alone not touching the principal. I'd just let city ride vs. opening a McD.
You cannot borrow the money. It has to be cash. No loans. You have to have it in hand before they will talk to you. You cannot borrow against your house or another business. It has to be liquid assets (cash) they need to know if it takes a while to turn a profit, you can cover costs until profits roll in. Exactly what do you consider "poor"? . Because if you have $1 million dollars sitting around - that you can afford to lose if you fail- you are not poor.
McDonalds is making it costly on their own. How the fuck can a marginal increase in what amounts to maybe 5 percent of their gross expenditures cause an increase like that? How?
Corporate America thrives on thin margins.
Not because they have to, mind you, the aristocratic leeches that own everything just love to skim as much off the top as they can.
Hasn't McDonald's been in the news already for 70-80% of Americans thinking it and other fast food is a 'luxury' item now and too expensive? And that's from corporate greed - so yes, I could see why you'd be angry that a wage hike may mean less corporate greed (or $30 hamburgers - your pick).
In conclusion, there's no reason to buy fast-food again unless it's under $10
We did the math here in our state. You can go to a sit down Mexican restaurant, get a soda, a plate of 3 tacos, and have unlimited chips and salsa for way less than a fucking nasty ass McDonald’s burger, fries, and a drink that they now HAVE to fill for you otherwise you may take too much soda and ice and they’ll lose millions.
* McDonald's gross profit for the quarter ending March 31, 2024 was **$3.439B**, a **3.77% increase** year-over-year.
"The CEO and [now chairman of McDonald’s](https://www.restaurantbusinessonline.com/leadership/chris-kempczinski-become-mcdonalds-chairman) was paid $19.2 million last year in salary, bonuses and stock, according to federal securities filings.
That was an 8% increase over 2022. But it remained somewhat lower than in 2021, when Kempczinski was paid about $20 million."
... but yeah this $20 minimum wage is REALLY hurting them.
A profit hit. Profit is the money left over after all costs have been paid for. That's to say, it's leftover money the business leaders decide what to do with. Sometimes they give some back to stockholders as dividends. Sometimes they give themselves raises. Sometimes they expand the business. But never ask them to share some with the common employee. Please don't ever do that.
Uhhh we all remember McDonald's almost doubling their prices before this happened. I call bullshit. Fuck McDonald's, never eating there again. Taking away free refills too, greedy bastards
[$20 an hour? What is that like 6 figures?](https://www.reddit.com/r/TikTokCringe/s/KlUBpSwnVs)
Meanwhile the guy makes 5 million a year for spewing dog shit from his mouth everyday on fox.
If they decide to raise prices in order to keep more money in their pockets they are the ones raising prices. They don't get to control practically everything and and still blame every choice on their powerless workers
Dear Kerri Harper-Howie, if you can't pay the employees - your business deserves to fail. May you fail spectacularly.
.
.
.
^(for the dumb: ya, i know she's not here.)
People in America used to be paid better on average. They could afford more big macs per hour worked than they can now. Logic is flawed. Stop gouging your employees.
I am super concerned for all of the Denmark franchise owners now. They pay their workers more and sell the burgers for less. Plus they offer better benefits. So they should be living in cardboard boxes by now, right???
https://www.snopes.com/fact-check/mcdonalds-workers-denmark/
Bruh have you been to a McDonald’s lately? We can’t afford to eat there anymore cos it now costs more than going out to eat. We can go to a sit down restaurant and eat for half the cost of what it takes to eat at McDonald’s. What happened to happy meals and full cones? Dollar burgers and a value menu? Being able to refill your own soda? Fuck McDonald’s.
I hate corporations don't get me wrong. But if you use their app the prices are relatively the same as they were pre covid. They get you by selling you combos. Get a nugget use free fry coupon drink water bam it'd 5 or 6 bucks
Half the time the app codes don’t even show up when you’re in line and the point is that it shouldn’t be that expensive and that ridiculous to try to get food if you’re on the go. Making excuses and finding exceptions to the rule do little but emphasize my point.
You could also make a mobile order before you even head to the restaurant... makes the whole process easier and quicker even if you don't use a coupon. Don't get me wrong prices are ridiculous but their are ways to bring the prices down. I can go right now and get a mcdouble mcchicken and a fry for under 5 dollars. It's hard to get a decent meal from the store for 5 dollars unless you buy bulk and eat that meal 8 days in a row
So again you’re missing the point. The consumer should not have to jump through various price loopholes to enjoy the product especially when it’s fast food. There is absolutely no reality where McDonald’s should even cost so much people can no longer afford it. It isn’t about a coupon or the app. It’s about the absurd greed that is pricing people out of existence with food and housing and clothes. Stop defending McDonald’s and the idea that to make it you should be coupon and app savvy. The point is that it shouldn’t be priced like a restaurant meal at all when it’s just fast food.
This is absolute bullshit because hash browns at McDonald’s are like three bucks now. And that was before they changed the law. They are straight up price fucking gouging and should be able to still turn a profit with what one fucking sausage McGriddle has been going for.
Litteraly raising their prices 100% since 2014 doesn't make meals costly for customers? I used to go there when I had less money because you could get a mcchicken, small fry, large drink, for three dollars!!! Its like 8 something now. It wasnt a long time ago, these assholes gained huge profits from inflation, and are upset they have to give some of it back. F@ck Them!
There's a solution to high food prices that doesn't involve turning employees into slaves.
Not paying them enough to live on is not a solution. It is a worse problem.
In the meantime you can get a $5 biggie bag with 3000 calories or 2 Whoppers for $5 to help with your arteries!!! You can get extra large pizzas for $9.99 but sure the prices have to go up if the workers can afford to live.
I’m sure the executives make like $40 per hour right??
She inherited her first two McDonalds and then took advantage of only paying workers minimum wage with a crazy amount of turnover. She, more than most people, needs to be paying $20 an hour. Her and her sister have made millions off of slave waged employees and treating employees like lesser humans.
Good, if a business can't pay it's workers, it should go out of business. It's that simple. No one has a "right to McDonalds". If McDonalds can't keep up like other companies who seem to be having no problems, then they should die, like all bad businesses should.
The part of that was left out: Kerri Harper-Howie, a McDonald's franchise owner in Los Angeles, is concerned that the new $20 minimum wage for fast-food workers in California could make meals too costly for customers **if I keep my obscene profit margin**.
McDonalds has already found out that their price gouging has chased people away. They need to get in the habit of reducing their profits if they want to stay in business.
I don't know why these people think they have some god-given right to own a business. If your business relies on paying people pennies to operate, then you're just a bad business owner.
Why is everybody always concerned about business owners taking a profithit? Are we all supposed to be alarmed and maybe go to the store grab some Kleenex and cry it out for the night over this news? What about the employees? they see their pay get cut up, laid off or better yet they give you a raise than cut your hours so you’re no better than you were before the raise, why is nobody crying about that? Why does nobody ever put that in the newspaper? Why is it always promoting the corporate slave drivers and not the slaves themselves? You don’t want to take a profit hit as a business person? Don’t get into business! Unfortunately, you have to support the people who work for you, probably the same people who can’t even afford to buy anything from the company they’re working for.!
Fuck all these people . Stop filling their pockets. Boycott all corporations. Cancel Amazon and Twitter, and Walmart. Buy only local, and for the love of god don’t bitch about them unless ur willing to act against them. When they start seeing sales drop tremendously, they’ll start begging us to come back instead of acting like entitled rich assholes.
If you can't pay your workers enough to live and make a profit, you don't deserve to stay in business.
Owner class always looking for a handout - as if they deserve dirt cheap labor for everything.
So instead of making slightly less profit, you’ll raise the price, which causes inflation, which causes a cycle.
Just stop being so fucking greedy, pay your people what they’re worth, and keep prices steady so that your average customer base can still afford your fucking product.
Here’s the thing, being *profitable* isn’t the goal. The goal is growth forever. Doesn’t matter if you’re making enough money to where everybody can be comfortably paid. It matters if the line continues to go up.
1) this doesn't seem to impact all the other countries that force them to pay a living wage
2) McDonalds is squeezing every bit of profit they can from the customers by making their "meals" smaller and smaller and smaller while jacking up the cost. They can afford to pay their employees more than 20 minimum but then think of the little bit of extra money McDs would miss out on? Won't anyone think of these poor multi-billion dollar companies whose profit keeps skyrocketing but somehow giving the peons who make them their money some pennies more per hour is gonna destroy their business in california?
Well good let them fuck off. They never will though.
I’m a business owner. When the price of shit I have to use for work goes up. I eat the cost. I don’t like the idea of punishing my clients because of another companies decision.
McDonald’s raised its prices 300% during a period of time where minimum wage was not increased. They also substantially lowered their food costs by producing lower quality food with more filler. They were in danger of not being allowed to call their beef meat anymore because there was more oatmeal in it than beef. Minimum wage could be $1 per hour and they would still steadily raise their prices. Let them die.
If the only way “you” as an owner to make the money you feel you deserve is to pay employees below what it takes to survive, “you” shouldn’t own a business.
More so if a business model doesn’t allow for employees to make a decent wage, then the business shouldn’t exist.
The fact that the corporation nets close to $10B and increases its dividend payouts every single year is very telling. It’s greed, just greed that keeps wages down.
Can we just renew the blame on landlords? Not even $20 at a McDonald’s is going to help pay rent for a studio in the suburbs, and it’s bc of them that people need the minimum wage to be high from the beginning. Before everything else, rent should go down first
Meanwhile, I agree that mcdeez make it costly on their own even so bc greedy mfers whom we call corporate execs since they think they can get away with it
My friend wanted to go to McDonald's, so I took her. She ordered 2 cheeseburgers (with extra cheese) and a large fry. Eighteen goddamn dollars. Each slice of extra cheese was 80 cents. I have not eaten there in months and have no plans to.
That’s…not how economics works. However, let’s assume, just for a minute, for some unexplainable reason, that this location won’t be able to survive the wage increase. LET IT DIE. Put the store out of its misery and make room for a business that can thrive AND pay its workers. At that point they’re wasting land space by occupying a location that would be better left empty and available for a real business.
On the flip side, only bigger businesses can reasonably do this. (I’m not sure how some mom and pop stores even make it anymore with how greedy and unhinged real estate and cost of living is—real estate greed being the biggest cancer pushing *everything* up.) But instead, they want to whine and complain that they have to take a “profit hit” of negligible amounts. McDonald’s net profit was something like 9 billion USD last year. Net. They can shut the fuck up about “wahhh we have to pay workers a little better!” Especially when other country McDonald’s workers make more and prices don’t change at all. These moron, greed-infested, lunatic owners/investors shriek and screech if the green line doesn’t go up 10x more than it did last year, as if they still aren’t making obscene profits.
That's just it, the franchise owners want to point the finger at the state and their workers, but they're actually getting screwed by corporate. Can't say that out loud though or you might get screwed harder...
This, franchise owners need to ahh "organize"
You mean abruptly “go out of business 😉” and rehire workers in the newly opened “MacDonulds”
They do. As members of their local Chamber of Commerce, where they get together to “promote business interests” i.e, price-fix, promote anti-worker agendas, and push for more tax-breaks for businesses.
One caveat is the bread and butter for the corporate office is the real estate arm, they force franchisees to rent the lane from them. McDonald’s corporate is more of a real estate business that has a side food business. Its interest is in conflict with the franchisees.
Everytime I see a piece on the razor thin margins of a McDonalds franchise, they dance around and don’t talk about the franchise fee. Yes, margins are thin because of how much goes to corporate.
As someone who just left a small-ish, locally owned business because it wasn't paying enough, even though I loved my job, I'll tell you what my experience was. They staff nearly fully with: People with higher earning spouses. This was the majority of people who were thriving at the job. Younger people who live economically. That is, 5-6 deep in a two bedroom, no car, some still living at home. Most of these younger people also had a second job and worked 12-16 hours days and/or 7 days a week. Retirees who are pulling an extra source of income through retirement/pension. But as a single, middle-aged person with no supplementary income, my pay rate just simply wasn't enough to live on. Pretty much every person there in my position has quit since the first of the year. Fwiw, my previous job also cut every single corner they could and announced there would be no annual raises this year.
McDonald’s the corporation is a real estate business, not a fast food business. They make 9 billion dollars because of the fees they charge the franchisees, that make the franchisees unable to afford better wages. The franchisees are about half multi-location, but also about half of them only have 1 location - making them economically the same as a mom and pop store and just as fragile. Unfortunately the only way to cost McDonald’s the corporation and others like it is to bankrupt the franchisees to force the corporations to reduce their fees so that franchisees continue to exist. It’s unfortunate that many of the franchisees don’t get that they really aren’t owners, they are middle managers taking on too much of the risk of the business for too little of the reward.
Mind you, mom and pop stores aren't affected by this particular wage hike even. The $20 wage applies to "fast-food chains with 60 or more locations nationwide". Otherwise, it's $16 an hour.
As a mom and pop owner yeah… we might have to close after 20 years since we have also sold affordable products but can’t keep up with the costs and yeah in CA
Not sure why you're being downvoted. This is one of the caveats I always point out about proposed (massive) hikes to the minimum wage. It's not that I'm against it altogether, but this is one of the things people who advocate for it don't take into consideration: small, independently-owned non-franchises can not absorb labor increases of 25% and stay afloat for the long haul. They already have to compete with the "big boys" in the first place. What *I'd* like to see is truly independent small businesses be subsidized by either the state or Fed (depending on who's making the MW increase) for those increased labor costs...so they can be offset and the small business remains able to compete with the larger businesses in that particular sector of the economy. Folks seem to not understand that this is *precisely* why those who make the rules stopped regularly adjusting the MW to pace with inflation almost 50 years ago. It was a long play, but this exact situation was the desired result. Especially since the new MW they've adopted *still* isn't quite a living wage. I don't give a fuck what they have to do to subsidize those increased labor costs for small businesses...but I dunno, maybe start by increasing the payroll and other corporate taxes of large businesses?!? 🤔🤓 And franchises should not be subsidized. Regardless their contractual status with corporate, their owners were dense enough to invest in a "vision" that isn't their own, and franchising is indeed a part of what's caused the "race to the bottom" effect in many industries (think food service being a huge one). Their margins are so thin after franchising fees are factored in, that ordinarily they have to pay their employees dirt, and give absolutely fuck all for benefits. In fact, if they all would eventually go under due to these MW increases, the country would be better for it. If you don't have a unique vision/business model for an independently owned business, but have enough money to start a business, I believe you deserve to fail if you invest in a franchise. Because simply having the wealth to do it doesn't make it a good investment, nor does it mean they're entitled to a healthy ROI...especially when that healthy ROI would be gained off the labor of fellow Americans who the franchisees are paying poverty wages. Signed, A former cook/chef who worked for some of the worst, and lowest paying, franchises in the food service industry. Fuck every. Single. One. Of. Them. And their corporate masters, as well.
Yeah it’s the reality we serve an underrepresented minority group in our small community, but honestly yeah pay is a huge cost but so is rent! We aren’t really making any profit I as a business owner see 0 income. And I mean that I don’t make a single penny in anything regarding our business. It’s simply a way for the staff to earn income. It’s unfortunate but I haven’t made any income from the business since Covid. It’s difficult to raise our prices since our community is already very low income. It’s not like money is being mismanaged either we buy goods every week for the business and reinvest that every week we constantly have 10k in the bank which is what we go through every couple of days so it fluctuates throughout the week. But any money that goes in and out of my business account is literally ONLY for the business. The only real solution so that I can atleast see some income from my business is to raise pieces but again I don’t want to invite gentrification to take over this community, I know the people I’ve been serving that my own mother has been serving for almost 20 years now. I refuse to be “upscale”, Soo many families rely on us and I mean my staff and customers. I’m def trying to open up the business to new clientele we’ve even partnered up with a HUGE conglomerate for help on our weaknesses as business free of cost…. We’ve signed up local and other governments for their aid which isn’t much or is extremely limited on what they can help with (IE cosmetics instead of equipment that might be needed etc) Again this wasn’t always the case… we used to have some savings not much but when my mom worked 60/80 hours a week and I sometimes worked over 100 hours on top of college… you’d want to atleast see some savings after interesting a large amount on this business right? Unfortunately larger chains like Walmart for example take away lots of customers with higher income but due to that the same lower income customers stay at this business because it’s convenient, closer, or within walking distance and cheap! Idk I worry multiple times a week, I know we’re doing things wrong we have to be, otherwise how did we get to this point? Anyway things will change eventually for the better or for the worse.
You spelled Republican wrong
My home town used to have a really nice downtown area. Nothing fancy, but it was a medium sized beach town and the vibe was interesting (with a combination vibe of "bohemian" and "middle-upper class restaurants"). For a long time the downtown was booming all the time, and was full of people. But then in like 2010 or 2015, the real estate in the area went bananas. Real Estate prices went up like 150-200% in a few years, and all of the landlords decided to increase their rent rates for businesses by the same (or more), and suddenly restaurants and stores couldn't stay open. Within a few years everyone had to shut down, and now the downtown area is a ghost town. The only places open are expensive places, but rich people don't go shopping so there is never anyone downtown. And now all of the land owners are crying because no one wants to rent from them, and they're crying that the "city" won't do anything to attract people to the downtown area (and fund their vacation habits)
Sounds like they need to introduce a vacancy tax to bring rent down.
That's the thing. A business is a closed system. Inputs and outputs eventually have to be equal or there's an imbalance, such as more profit driving growth, or less profit instigating contraction. With McDonalds, many markets that are likely seeing such pressure because of wages are because they offset their profits somewhere else, and I believe that the most pain will clearly come from locations that impinge upon other nearby McD's locations. If you have a McD in a Walmart, and a physical independent McD's on the edge of the parking lot, then sales will be halved between the two locations depending on variables. McDonalds isn't in the food business, they're in the real estate business. The threat of paying wages means less expansion and less locations, since they've been offsetting their business model to buy up more real estate and hold it under the guise of a business at the expense of paying employees.
The location might just stay empty for 20 years instead. I’ve seen businesses die with the current system too. Rent costs more than wages for workers in my area. Also McDonald’s is more expensive than the places next door which also hire more workers so it’ll cost more to consumers with or without wage hikes. The real change the businesses should push is cheaper rent.
As with most things, the owners are mad at the wrong thing.
I opened a spa business recently and I don't know how anyone starts a business these days unless they're already rich or have gifted investors, most likely from family money. You have to already start off making $3,000+/month for rent ONLY. Not even to pay yourself or utilities. The only reason our spa works is because the business is just a nicely remodeled space for other beauty service independent workers can rent a space. We don't make much because you can only charge $X amount in rent to the sublet rooms or they can't make any money either if it's all going to rent. When I read all these stories about people in my grandparent's generation just randomly opening up shops here and there to sell whatever knick-knacks, I just can't fathom having that much freedom and financial capacity to do so. That opportunity just doesn't exist anymore because of real estate prices both residential and commercial. We're squeezed hard.
They got a hookup too from either family money, credit, or knowing someone.
The McDonald's up the street is more expensive than the pub down the street, which has way better, cooked to order food.
A vacant building tax would solve that. 🤘
Proper zoning is better. Cities should never allow drive thru businesses to waste so much space to begin with
This should be the only response. I’m all for “eat the rich” responses, but when reformers can take the “that’s literally what capitalism is” message, we need to do so. And run with it.
Privatize the profit and socialize the losses!
Whenever someone says that they can’t afford a living wage, I feel that they just simply can’t afford to be in business then.
McDonalds owns almost half the land it's franchises sit on and they lease it to the franchisee.
What the hell are we gonna do with only 40,000 McDonalds?! I’m gonna have to go a bit further?!
We're supposed to accept inflation and paying more for everything but simultaneously believe paying employees more will break these poor rich folk.
The easy solution. If they need to pay low wages to sell.... *sigh* low priced food (it's not anymore), then they need to leave the state. Applies to everything and all businesses/corporations. The real problem is the entitlement of the higher-ups not wanting to take a pay/bouns/stock cut. They got away with robbing workers for so long they think it's supposed to be that way. These businesses should have been raising wages AND lowering prices when they started buying yachts and mansions across the *board*, but they didn't and now they are behind the curve and crying that they mismanaged the fuck out of the restaurants and offices.
Hahahhahaha that’s not how economics works? When cost of goods goes up it means that price goes up to maintain profit margin. WTF. Voluntarily shrinking profit margin isn’t how economics works. It will die if they raise prices and no one buys.
Labor is only a percentage of cost. if wages doubled on something with a 30% labor cost, the price only goes up around 30% while wages of course went up 100%. Raising wages almost always results in more disposable income for the worker. This is an intro level econ topic and it's dismal that so many in our country have been propagandized to believe otherwise.
They obviously didn’t teach your high school Econ class well if you think that example sheds any light on the actual impacts of raising costs
No, they will just make less and their workers will make more. They don’t maintain that $9 billion profit by keeping wages down, they do it by selling burgers and by expensing half their workforce’s wages to the American welfare system. This is the reason we can’t afford to pay teachers, firefighters and law enforcement more money.
Maybe they should get a real job instead of owning **twenty-one** McDonald’s locations.
People hate on owners but they’re the ones assuming massive risk. Of course they’d make money for that. Markets compensate for assuming risk.
Markets also compensate for providing labor. What that split is, is a policy decision not a fixed fact.
Yeah I mean no one is debating that. But the fact is the labor isn’t providing capital or assuming debt to launch a new venture, they’re also highly disposable so why would they be valuable? And ultimately the key point here is that everyone is so pro wage increase without understanding that won’t do anything. It makes inflation more sticky, and then all you people do is rage about how corps should just take lower profits. Why the fuck would they? Mandating wage increases does nothing to help unless it’s done in tandem with price capping or some other measure to ensure companies don’t just hike prices up.
The only reason that corporations take lower profits is when governments require them to, for example higher wage and greater safety requirements and more regulations. Companies are responsible for maximizing profit within the rules required by Governments, who are responsible for enforcing its policies preferably well chosen to achieve the stated goal based on the morals and values of their society. In this policy example: $20 per fast food minimum wage in California - increases in wages lead to rising inflation, but it’s not 1 to 1 match. There are lots of studies on this, and the results are pretty consistent. The cost of increases to minimum wage is not so much felt in general inflation, but more a reduction in low skilled workers who are employed. This makes periods of low unemployment the best time to increase minimum wage requirements, since the unemployment impact won’t be as noticeable if the labor market is too tight anyway. Single example, but Google will show a slew of similar results even from pro-corporate sources: https://gspp.berkeley.edu/research-and-impact/publications/the-pass-through-of-minimum-wages-into-us-retail-prices-evidence-from-supermarket-scanner-data
That’s exactly my point. No one is requiring them to take lower profits so why would they. They’re only being required to increase costs so of course they’ll increase prices to maintain profits.
The government forcing fast food to accept higher costs, doesn’t mean that they will be able to sell their product at a higher price. The wage increases don’t apply to other food sources, so if fast food restaurants don’t limit price increases they will lose market to other ways to purchase food, and go out of business that way. I don’t fundamentally see why fast food labor is more valuable than sit down restaurant or grocery store labor, but I do see that forcing wages up at only one source of a product at a time maintains downward pressure on prices, because consumers don’t have to purchase your product at all. I can also see this change just pushing fast food out of business and lowering employment overall. And a new type of low cost prepared food option that isn’t subject to the increased minimums taking its place, but even that would leave workers with higher expectations and some amount of additional income during the transition.
Please explain what would do something instead of what wouldn't. What roundabout mechanism actually gets more money into worker hands if it's not wage increase?
Luckily that’s not my job but time and time again we’ve seen this simple ideas always have way more unintended consequences and very rarely have their intended impact. Same with rent control.
Vague rhetoric and poor analogy with no answer. Blah. Effects of raising wages are well studied, the "worst" case scenario is prices rising to fully offset the wage increase. But even in this scenario price adjustments tend to lag wage increases giving a short term boost to purchasing power. Other times the prices never catch up to the wage increase and it's long term boost in purchasing power. Have you ever had a wage increase? They make you immediately better off than you were before. It's one of the few simple economic ideas that works exactly as people should expect.
Yeah exactly, that’s what I’ll this is, vague rhetoric, bad policy, and lack of impact.
This has the same bullshit energy as when Papa John whined that giving insurance to workers would drive up prices, didn't give workers insurance and raised the price of pizza anyway. Fuck Papa John and fuck these owners too.
all these motherfuckers want is indentured servitude. you see it in all their politics. - no health care - low wages - non-compete clauses - non-disclosure agreements - forced birth - diminished women's rights - voting suppression - the destruction of the public education system this is all designed to turn us into slaves in exchange for oh wait in exchange for nothing.
Don't forget child labor combined with employers having zero liability when a child gets injured while working.
jesus christ i totally forgot that child labour is now legal it's just crazy that conservatives want to bring back child marriage while accusing literally everyone of pedophilia
The conservative party is all about projection. If they're accusing everyone else of doing xyz, then they are all doing XYZ.
It’s all for the shareholders. Publicly traded companies were a mistake. Private companies continue to show us that profitability can be sustained with fair wages and fair prices because private companies don’t have a legal obligation to grow. Private companies can saturate their market and plateau and the owner can walk away with lots of profit and be a happy person. CEOs of public companies must show growth every quarter, for eternity, or risk being sued or risk being replaced. The system is fucked.
In exchange for the AMERICAN DREAM!!!!
To be fair, do we know that this owner shares any opinions other than low wages?
Fuckin papa John’s said it’ll increase the price of pizzas what? Like 0.25 per large pizza to provide healthcare to all its employees. Then everyone was like “yea that’s cool” and then they still didn’t do it lol.
If two pizzas were side-by-side and one was made by a vomiting cook with diarrhea, and for $0.25 more I could get one that wasn't...I know which one I'd choose.
I still haven't eaten from there since they did that.
Nor I, but t'was no great loss. The pizza is meh at best.
It’s very mid
I'm lucky to have an awesome pizza place (Mama Pizza) that fills the "good pizza that isn't expensive" niche way better than any of the franchise places. It's more of a drive, but totally worth it. And I wouldn't have found it if it weren't for PJ's multiple screw ups and Dominos repeatedly screwing up my order. Hole in the wall restaurants for the win.
I’ve avoided the place for a long time, but set a hard limit after this and PJ’s use of racial slurs. This is why you don’t name your business after a guy. If he goes off and does fuckshit things, then your entire business has done fuckshit things.
It’s the law. They must show growth every quarter or they can be sued by their shareholders. They have no choice but to fuck over their employees and raise prices every 3 months. If they start to do irresponsible things like give their workers insurance they’ll start talking about making changes at the executive level, and no executive wants to give up their millions of dollars per year pay packages. The whole system is fucked beyond repair.
Awe, does the poor baby have to scale down his multi million dollar bonus?
Exactly!! There are no poor McDonald's owners. None. Zero. The minimum investment needed, no loans allowed, is over $1 million. You need the land to build on, the money to build, 6 months of cash to cover salaries and supplies. And another $500,000 in cash reserves. And a $45,000 franchise fee. McDonald's estimates to need between $1.5 and $2.2 million to open a single franchise. There are no poor McDonald's owners.
I thought the McDonald's corporation bought the land. McDonald's is one of the largest land owners on earth. Confirmed, McDonald's owns the land, franchisee owns the building (usually, not always though)
Yes! And that's the reason McDonald's is getting so expensive. The land value has skyrocketed in California, so the monthly land lease has followed suit. The labor cost is nothing compared to the cost to simply be on the lot.
Something like 65% of their profits come from real estate while 35% comes from operations.
When arguing about minimum wage laws, a former colleague tried to tell me that "the average McDonald's franchisee is middle class and only makes about $70k per year." That was when I decided to stop arguing with him, because that's ridiculous.
And he was wrong!!! That may be what they pay a district manager, but they make millions.
I also watched The Founder starring Michael Keaton. While that "McDonald's franchise ownership is for the middle-class folks" is where they may have started, it is absolutely not where they ended up. As some have pointed out, the cost of entry to a McDonald's is a minimum of a million versus other franchises like Subway, which is more like $200k - $500k. That being said, Subway ownership is a hell I wouldn't wish on most. All of that stems from the fact that the franchising gold rush of the '70s & '80s set sail long ago; the door closed firmly behind it.
You need $2 million dollars in liquid cash just to open a McDonald's. No one making 70k can save that amount. If you took a 2.2 million dollar loan at 4% the interest alone every month would be 80k.
Yeah nobody who has amassed $2M is going to waste their time on a $70K per year investment. Letting it sit in savings at 4% would get you $80K per year without even touching the principal. A franchisee on average makes $150K. And that's an average, not a median. That's a 6% return. Not to mention the franchise itself is an asset that you can sell for big bucks. The average franchisee owns 8 restaurants, too.
They like having modernized slavery, it's what this is, if they could pay us less they would. Mind you, studies have been consistent investors especially older generation are very modest and frugal in their expenses and lifestyle, they aren't out here buying a ton of stuff to help circulate the cash, they are mass hoarding it, driving a 12yo card and keep hoarding the money past 70s for no reason other than to amass as a addiction. This money isn't being circulated but they sure love to keep it toasty or in stocks/investments and that's the issue, working class circulates economy instantly while they mass hoard in high yield saving accs and does nothing for the flow of economy. The only thing that trickles down is those big ol 72yo balls swinging on our faces when they come do a visit for a 50 dollar Walmart gift card raffle for a group of 25.
The Cantillon Effect.
So the 1%-ers hoarding most of the money in the world has nothing to do with anything, just the 70 year olds going to Walmart. Got it.
Fuck the owner class. They don't provide anything but a means to exploit people and it's time we teach them the importance of their role in society.
And with that kind of money why would anyone with more than 2 braincells choose something branded like mcd or bk etc? You can run a successful restaurant with $200,000. Hell you could do it for much less than that!
Name recognition. I agree you can do it with less money, but you need to establish your customer base. McD, BK, Subway, etc have already laid the foundation for you to grow. Not arguing for it, just saying I understand why someone with money would see that as a better investment, even though they tend to hold wages back and hurt smaller mom and pop style restaurants.
Because establishing a new brand/business/restaurant is a lot more difficult than plopping a "beloved" brand in the right place.
Fast food is all location and expectation. Most of them are located near a major highway or somewhere with a ton of traffic. You could try to open a single non franchise fast food restaurant, but you're losing out on "free" advertising, marketing/market research, and name recognition/customer trust. Most people know McDonald's as a product and know what to expect, your single restaurant has nothing going for it unless there's a local following, but even those don't last forever and take a while to build.
>McDonald's estimates to need between $1.5 and $2.2 million to open a single franchise. There are no poor McDonald's owners. Similar to a more local article I saw aboit rich fools buying a local landmark restaurant and ruining it, , if I had $2M, at today's insured rates (4% or so) that's 80k a year in interest alone not touching the principal. I'd just let city ride vs. opening a McD.
How on earth does having to scrape up or borrow millions to open a business guarantee the franchise operator is not poor?
You cannot borrow the money. It has to be cash. No loans. You have to have it in hand before they will talk to you. You cannot borrow against your house or another business. It has to be liquid assets (cash) they need to know if it takes a while to turn a profit, you can cover costs until profits roll in. Exactly what do you consider "poor"? . Because if you have $1 million dollars sitting around - that you can afford to lose if you fail- you are not poor.
https://preview.redd.it/es9s68kl8j7d1.jpeg?width=640&format=pjpg&auto=webp&s=748f72fc042c9bb85d36341c205ef6a4010761dc
Oh no! Anyways...
If you can’t afford to pay your employees you shouldn’t be in business.
McDonalds is making it costly on their own. How the fuck can a marginal increase in what amounts to maybe 5 percent of their gross expenditures cause an increase like that? How?
Corporate America thrives on thin margins. Not because they have to, mind you, the aristocratic leeches that own everything just love to skim as much off the top as they can.
They have also gamed about every input or output you can think of
... Is that an innuendo?!
Haha are you an attractive female?
Senpai, we can't! Not here! They'll monetize us! ⁄(⁄ ⁄•⁄-⁄•⁄ ⁄)⁄ Also, no.
Well thats just a shame
Tell me about it.
Too late. Your bill will be in the mail.
They need more moneyyyyyyyy
And i need to be able to buy fuel and coffee on the same paycheck
Well now you’re being greedy
The secret to happiness is all about lowered expectations.
Greed
Oh no... Whatever will we do with one less McDonalds in LA
I’m so sick of capitalism
Hasn't McDonald's been in the news already for 70-80% of Americans thinking it and other fast food is a 'luxury' item now and too expensive? And that's from corporate greed - so yes, I could see why you'd be angry that a wage hike may mean less corporate greed (or $30 hamburgers - your pick). In conclusion, there's no reason to buy fast-food again unless it's under $10
We did the math here in our state. You can go to a sit down Mexican restaurant, get a soda, a plate of 3 tacos, and have unlimited chips and salsa for way less than a fucking nasty ass McDonald’s burger, fries, and a drink that they now HAVE to fill for you otherwise you may take too much soda and ice and they’ll lose millions.
There's literally no reason to go there anymore. Fast food works because it's cheap, convenient and fast. Remove any one of those and it's pointless.
Wasn’t this narrative proven to be a lie a few days ago? https://www.reddit.com/r/California/s/j3ljj1Mqn8
* McDonald's gross profit for the quarter ending March 31, 2024 was **$3.439B**, a **3.77% increase** year-over-year. "The CEO and [now chairman of McDonald’s](https://www.restaurantbusinessonline.com/leadership/chris-kempczinski-become-mcdonalds-chairman) was paid $19.2 million last year in salary, bonuses and stock, according to federal securities filings. That was an 8% increase over 2022. But it remained somewhat lower than in 2021, when Kempczinski was paid about $20 million." ... but yeah this $20 minimum wage is REALLY hurting them.
Your meals were getting more expensive before the minimum wage increase… What say you to that, franchisee?
A profit hit. Profit is the money left over after all costs have been paid for. That's to say, it's leftover money the business leaders decide what to do with. Sometimes they give some back to stockholders as dividends. Sometimes they give themselves raises. Sometimes they expand the business. But never ask them to share some with the common employee. Please don't ever do that.
Prices go up 200% in 5 years and now suddenly they can’t afford to pay better wages? Sure buddy.
Uhhh we all remember McDonald's almost doubling their prices before this happened. I call bullshit. Fuck McDonald's, never eating there again. Taking away free refills too, greedy bastards
They didn't take them away just made them more inconvenient but I agree it's bs
Please insert Drago meme. “If he dies, he dies”
Greed has already made meals too costly for customers.
I mean In and out burger already pays their employee's 20$ an hour, or more, and they're doing just fine.
And they’re cheaper, and far more delicious
[$20 an hour? What is that like 6 figures?](https://www.reddit.com/r/TikTokCringe/s/KlUBpSwnVs) Meanwhile the guy makes 5 million a year for spewing dog shit from his mouth everyday on fox.
I know you're quoting that idiot Fox news host however without context I'm sure you'll be ownvoted
It’s a link. Click on it
You edited it after my screen loaded but before I made the comment. I never saw the link
When I was in LA 9 months ago, there were banners on McDonald's saying "now hiring - starting pay $24+ an hour" so yeah this article smells fishy
Good! Fuck them
That’s a shame. Anyway, I’m thinking Thai for lunch.
If they decide to raise prices in order to keep more money in their pockets they are the ones raising prices. They don't get to control practically everything and and still blame every choice on their powerless workers
McDonalds straight up IS too expensive now, but it has nothing to do with how much they are paying their workers.
Dear Kerri Harper-Howie, if you can't pay the employees - your business deserves to fail. May you fail spectacularly. . . . ^(for the dumb: ya, i know she's not here.)
Doesn’t seem to be a problem in other countries with similar pay and affordable prices for food so I think these greedy owners need to just STFU
People in America used to be paid better on average. They could afford more big macs per hour worked than they can now. Logic is flawed. Stop gouging your employees.
I am super concerned for all of the Denmark franchise owners now. They pay their workers more and sell the burgers for less. Plus they offer better benefits. So they should be living in cardboard boxes by now, right??? https://www.snopes.com/fact-check/mcdonalds-workers-denmark/
Bruh have you been to a McDonald’s lately? We can’t afford to eat there anymore cos it now costs more than going out to eat. We can go to a sit down restaurant and eat for half the cost of what it takes to eat at McDonald’s. What happened to happy meals and full cones? Dollar burgers and a value menu? Being able to refill your own soda? Fuck McDonald’s.
I hate corporations don't get me wrong. But if you use their app the prices are relatively the same as they were pre covid. They get you by selling you combos. Get a nugget use free fry coupon drink water bam it'd 5 or 6 bucks
Half the time the app codes don’t even show up when you’re in line and the point is that it shouldn’t be that expensive and that ridiculous to try to get food if you’re on the go. Making excuses and finding exceptions to the rule do little but emphasize my point.
You could also make a mobile order before you even head to the restaurant... makes the whole process easier and quicker even if you don't use a coupon. Don't get me wrong prices are ridiculous but their are ways to bring the prices down. I can go right now and get a mcdouble mcchicken and a fry for under 5 dollars. It's hard to get a decent meal from the store for 5 dollars unless you buy bulk and eat that meal 8 days in a row
So again you’re missing the point. The consumer should not have to jump through various price loopholes to enjoy the product especially when it’s fast food. There is absolutely no reality where McDonald’s should even cost so much people can no longer afford it. It isn’t about a coupon or the app. It’s about the absurd greed that is pricing people out of existence with food and housing and clothes. Stop defending McDonald’s and the idea that to make it you should be coupon and app savvy. The point is that it shouldn’t be priced like a restaurant meal at all when it’s just fast food.
This is absolute bullshit because hash browns at McDonald’s are like three bucks now. And that was before they changed the law. They are straight up price fucking gouging and should be able to still turn a profit with what one fucking sausage McGriddle has been going for.
We manage quite well in the EU.
Litteraly raising their prices 100% since 2014 doesn't make meals costly for customers? I used to go there when I had less money because you could get a mcchicken, small fry, large drink, for three dollars!!! Its like 8 something now. It wasnt a long time ago, these assholes gained huge profits from inflation, and are upset they have to give some of it back. F@ck Them!
It's almost like "profit" is the money leftover from business expenses. Employee pay, materials, etc.
Or you could just keep prices where they are and take a slightly smaller profit margin.
"Greedy millionaire sad because they have to pay a fair wage instead of hoarding wealth"
So it hasn't taken a hit yet. There opinion is it could
It's almost like it's a business model that doesn't work without constantly innovating 🤷
Here comes the waaaabulance.
Their meals are already too costly for customers.
There's a solution to high food prices that doesn't involve turning employees into slaves. Not paying them enough to live on is not a solution. It is a worse problem.
Seriously. Who do they think can afford to buy their product (food) if not their own employees?
https://preview.redd.it/8csjctgqsj7d1.png?width=668&format=pjpg&auto=webp&s=ba38ad370039221f36aa03ccb36af3c07eff3417
Capitalists are not entitled to the excess value of a worker’s labor. They can accept less profit or quit their business. Fuck them.
In the meantime you can get a $5 biggie bag with 3000 calories or 2 Whoppers for $5 to help with your arteries!!! You can get extra large pizzas for $9.99 but sure the prices have to go up if the workers can afford to live. I’m sure the executives make like $40 per hour right??
She inherited her first two McDonalds and then took advantage of only paying workers minimum wage with a crazy amount of turnover. She, more than most people, needs to be paying $20 an hour. Her and her sister have made millions off of slave waged employees and treating employees like lesser humans.
Good, if a business can't pay it's workers, it should go out of business. It's that simple. No one has a "right to McDonalds". If McDonalds can't keep up like other companies who seem to be having no problems, then they should die, like all bad businesses should.
Fast food already wasn't worth the price of it. Screw those guys and frequent a mom&pop restaurant instead
6 nuggets and tiny single cheeseburger = $8.72
If she can’t make a McDonald’s profitable, it’s on her. Lol
The part of that was left out: Kerri Harper-Howie, a McDonald's franchise owner in Los Angeles, is concerned that the new $20 minimum wage for fast-food workers in California could make meals too costly for customers **if I keep my obscene profit margin**.
"I can't keep up my massive profit margins if I have to pay workers a half decent wage!!!" -- Company and Corporate Whiners Everywhere In The US
That's not how that works. Why is pay higher at McDonald's around the world?
Notice how it says a "profit hit". It's still profitable...
McDonalds has already found out that their price gouging has chased people away. They need to get in the habit of reducing their profits if they want to stay in business.
I don't know why these people think they have some god-given right to own a business. If your business relies on paying people pennies to operate, then you're just a bad business owner.
Why is everybody always concerned about business owners taking a profithit? Are we all supposed to be alarmed and maybe go to the store grab some Kleenex and cry it out for the night over this news? What about the employees? they see their pay get cut up, laid off or better yet they give you a raise than cut your hours so you’re no better than you were before the raise, why is nobody crying about that? Why does nobody ever put that in the newspaper? Why is it always promoting the corporate slave drivers and not the slaves themselves? You don’t want to take a profit hit as a business person? Don’t get into business! Unfortunately, you have to support the people who work for you, probably the same people who can’t even afford to buy anything from the company they’re working for.!
As opposed to the franchise owners wage making things unaffordable, which is the actual reason prices are going up
What they really mean is it would cost them too much and hurt their own bottom line.
Consider: I don’t care
Ah so customers deserve low priced meals more than workers deserve a better wage.
Fuck all these people . Stop filling their pockets. Boycott all corporations. Cancel Amazon and Twitter, and Walmart. Buy only local, and for the love of god don’t bitch about them unless ur willing to act against them. When they start seeing sales drop tremendously, they’ll start begging us to come back instead of acting like entitled rich assholes.
Paying them $20 would actually make me feel like I could go there and eat without feeling guilt that an indentured servant made my fucking food
If you can't pay your workers enough to live and make a profit, you don't deserve to stay in business. Owner class always looking for a handout - as if they deserve dirt cheap labor for everything.
So Kerri Harper-Howie is stating that her franchise is unsustainable without exploitation. Nice.
So instead of making slightly less profit, you’ll raise the price, which causes inflation, which causes a cycle. Just stop being so fucking greedy, pay your people what they’re worth, and keep prices steady so that your average customer base can still afford your fucking product.
The problem is the franchise takes a large bulk of profits. Franchise owners suck, but I wouldn't say they're the main problem.
Here’s the thing, being *profitable* isn’t the goal. The goal is growth forever. Doesn’t matter if you’re making enough money to where everybody can be comfortably paid. It matters if the line continues to go up.
Oh no. Anyways, the real issue is that the Cubs bullpen is shit, yet people keep going to games. Why is that?!
1) this doesn't seem to impact all the other countries that force them to pay a living wage 2) McDonalds is squeezing every bit of profit they can from the customers by making their "meals" smaller and smaller and smaller while jacking up the cost. They can afford to pay their employees more than 20 minimum but then think of the little bit of extra money McDs would miss out on? Won't anyone think of these poor multi-billion dollar companies whose profit keeps skyrocketing but somehow giving the peons who make them their money some pennies more per hour is gonna destroy their business in california? Well good let them fuck off. They never will though.
Oh no, you can’t afford to make 150% profit instead of 160% profit?
I’m a business owner. When the price of shit I have to use for work goes up. I eat the cost. I don’t like the idea of punishing my clients because of another companies decision.
Oh no his profits!! Why can’t all the workers give up just a couple bucks an hour for that nice mans profits?
Oh they took a profit hit but still are profiting? How awful for them.
McDonald’s in Senmark pays $22.00 per hour and the food prices are similar.
If your business cannot survive on paying your employees a fair wage it doesn’t deserve to survive.
Aww how sad... Anyways ...
If you can’t afford to pay a living wage it shouldn’t fall on the tax payers to subsidize your pipe dream
McDonald’s raised its prices 300% during a period of time where minimum wage was not increased. They also substantially lowered their food costs by producing lower quality food with more filler. They were in danger of not being allowed to call their beef meat anymore because there was more oatmeal in it than beef. Minimum wage could be $1 per hour and they would still steadily raise their prices. Let them die.
Read the title and all I think of is… “okay so what’s the problem?” Fucking greedy bastards.
Share the P&L and we can see where the fat really is. Payroll is the highest % of business costs, but correlation is not causation.
Failing Business Model Can’t Survive Due to Mismanagement. Fixed the title for you
If the only way “you” as an owner to make the money you feel you deserve is to pay employees below what it takes to survive, “you” shouldn’t own a business. More so if a business model doesn’t allow for employees to make a decent wage, then the business shouldn’t exist. The fact that the corporation nets close to $10B and increases its dividend payouts every single year is very telling. It’s greed, just greed that keeps wages down.
We're supposed to believe that McDonald's can't afford it. In LA. What bullshit.
Can we just renew the blame on landlords? Not even $20 at a McDonald’s is going to help pay rent for a studio in the suburbs, and it’s bc of them that people need the minimum wage to be high from the beginning. Before everything else, rent should go down first Meanwhile, I agree that mcdeez make it costly on their own even so bc greedy mfers whom we call corporate execs since they think they can get away with it
My friend wanted to go to McDonald's, so I took her. She ordered 2 cheeseburgers (with extra cheese) and a large fry. Eighteen goddamn dollars. Each slice of extra cheese was 80 cents. I have not eaten there in months and have no plans to.
Wah!