Proposed Minimum Wage Increase

Restaurant Minimum Wage Increase 

Money by Junior Libby

The United States Federal Government is calling for an increase in the federal minimum wage from $7.25 to $9.00. This call has put the business world into a tailspin. Every employer of minimum wage workers are up in arms and yelling about the damage this proposed wage increase will do to an already fragile economy.

One of the largest employers in the minimum wage bracket is the restaurant industry. Seminars are being held on the affects of the wage increase, training sessions on cost cutting measures are being implemented and management are looking at staffing levels to see if they can cut staff in order to keep profits at pre increase levels.

Enough!!!! I am sick of this bullshit!!

Ok, a little strong but we here in the US have dug ourselves a huge hole and there is no way to climb out of it. Let’s look at a few facts.

The US has one of the lowest pay scales in the Western world.

You cannot live on $7.25 per hour. This is not a living wage.

Tips are the only way wait staff can survive financially.

The majority of food service staff don’t get tips. (Think fast food and back of house)

People complain that 47% of the population don’t pay tax, don’t contribute to the running of the country and are a burden on the rest who do pay tax. That is very true but here is the problem. If you pay a large percentage of the population a wage that is below poverty level then you cannot expect them to contribute to the country because they have nothing left at the end of the week to give to the tax man. Damn it, they can’t even feed their kids!

I have been lucky enough to work in several countries with differing attitudes to their workforce and from what I see; we treat our workers like crap.

There are many parts of the Western world where the minimum wage is close to $16.00 to $20.00 per hour for an adult full time worker, more on weekends and holidays and they get 4 weeks paid vacation per year. Part time workers get higher hourly rates than that and there are just as many successful restaurants and businesses as here in the US.  These countries also do not encourage tipping for restaurant staff because there is no need to and the menu price is what you pay, inclusive of tax, no tips allowed! The US and maybe a few others are the only countries that give prices without tax. The thing about a minimum wage that actually allows the recipient to live a reasonable life is the fact that everyone pays tax, yep everyone! Those same minimum wage people can also afford to frequent more restaurants and other businesses, spreading the wealth and contributing to the GDP. The other interesting thing about these countries is they fared better in the financial crisis than we did; in fact one did not even go into recession. Many economists agree that we have to adjust the federal minimum wage laws.

I am not saying that we throw out a system that has brought the country to a level of greatness that few can match but maybe it is time for a few changes that will lessen the poverty level for workers that put in a full work week and deserve better from the lucky country. Maybe we can learn from others and ensure that our system grows not only financially but socially as well.

As of this post the US house has voted down the proposed increase to the minimum wage. How can they look themselves in the eye every morning without becoming ill.

Control Costs and Increase Profits In Your Restaurant

Start Planning for 2013 NOW If You Haven’t Already….


cutting costs in your restaurant

The end of the year approaches and what a year it has been!! The economy is still in the dumps, although there has been some rebound in some parts of the country, most restaurants and food establishments are still not back to where they were a few years ago.

With the end of the year close it is now time to start planning for next year, in fact if you have not already done so, you should start now and I do mean now!!

Forget what has been and start to visualize how you are going to grow your sales and cut your costs for the coming twelve months. It is a new start and hopefully you will get a kick over the holiday period to help you put away a bit of money for promoting your business.

What do you plan for? Let’s assume you have done a complete budget for next year. Sales, costs, maintenance, recruitment, etc, etc. Now comes the planning for how you will achieve the sales and costs budgeted.  We all know that the two ways to ensure your business is healthy financially is to…. Grow Your Sales and Control Your Costs.

Sales growth comes from service and product excellence as well as marketing your business to keep existing customers and gain new ones. Sounds pretty simple but we all know that it is not. Trying to find time to run your business, worry about staffing issues and all the 1001 things that it takes to keep the doors open all fill your day from start to a very weary finish.

I suggest you take the time away from your restaurant business, even if it is one day to spend planning your strategy on saving costs and growing your business. Get someone to cover for you. If you have never let anyone look after your business before, then it is about time you started!! Sometimes it is necessary to spend time working for your business rather than in the business.

Decide on three major projects that will help you achieve these goals for the first half of the year, one long term or ongoing, one medium term and one short term. Plan to start them all by the end of January and ensure they are monitored to gauge their effectiveness. The sales growth part should start with the next six months of LSM campaigns and the budget for each. The cost control part is dependent on your circumstances but I would strongly suggest weekly stock takes and cost percentage reviews as a priority if you are not already doing so.

Still a bit lost as to what to plan and how to go about it?

I can help! I have just completed a guide “50 Ways to Control Costs and Increase Profit” and it is currently available for Kindle. Click Here to get your  Kindle copy.

In the next 10 days the book will be available for PDF download from this website with some very interesting and helpful bonuses such as:

  • A free copy of my LSM ebook
  • A Cost Control Worksheet to help you track your savings
  • An Excel worksheet Break Even Analysis
  • 50 Ways to Control Costs workbook to help you plan which of these great ideas you are going to implement

Both of these guides and the additional tools are perfect for planning the year ahead and assisting you in making the profit you deserve.

Good planning and a Happy Holidays!

Rod Smith

QSR Customer Service Index 2011

The American Customer Service Index for this year has just been released and a few surprises jump out at me.

For many years Starbucks has been in the decline in store numbers both here in the US and in many other countries around the world with local opposition beating them in both service, price and coffee quality. Some would say that is not a hard thing to do but it seems their customers are happy with their offering, with a 2.6% increase in customer satisfaction over last year. That’s two years in a row of happy customers.

I am also happy to see Pizza Hut finally doing something right and again it is two years of increased customer satisfaction with this year being a whopping 3.8% over last year.

In fact the majority of fast food did quite well in the rankings with McDonalds beating the rest at 7.5% over last year.

The concepts that did not do as well are the ones that you would expect and I am a little sad to see KFC flat this year. They seem to have lost there way a bit recently. I certainly have noticed a downturn in product quality, service and cleanliness recently.

If you are interested in seeing the full list by industry here is how you get there.