He has three options, raise the price on the menu (loose customers, especially in this economy), severely lower the hourly rate of servers which is like 2.83 and hour depending on where you live and raise a mandatory gratuity for the server to like 25% (which is already been made illegal), or do what he is doing. Which is the better option, and which would the servers and customers rather have. Places like Denny's do not serve liquor which is where most chains make their money making usually 100% on alcohol, the food pretty much just pays for overhead. Dennys is based on easy quick food, high volume, and being open 24/7 minimally staffed to make up for low volume times. Oh there is a 4th option, do nothing a go out of business, thats a loose-loose for everyone.
What, did you expect Obamacare was'nt going to have any consequences, or did you think it was a not strings attached deal? Sad thing is, things like this aren't going to be the main thing to be worried about with Obamacare.
Obamacare doesn't even do what it is supposed to, how does taxing the business and individuals who cannot afford healthcare going to make it more affordable? "Oh well the hospitals won't be eating the costs for people getting healthcare for free." Really, they cant afford healthcare for a reason, whose going to pay for them? Oh yea, dont forget about the millions of illegal immigrants living in america, where do you think they get their healthcare from (answer: ER's), and who do you think is going to pay for them? The hospitals and the business. All it does is tell the business to share some of the debt with the hospitals...business who are already getting killed by healthcare costs.
Do you realize just how MUCH Papa John CEO,Applebee's owner?CEO made last year ?They can afford to pay the SLIGHT increase,they are just greedy bastards!
Do you realize how much skill, knowledge, and ability it requires to be CEO of a Papa John or Applebees? Do you know how much stockholders--many who are people not far from the poverty line such as myself--how much the employees, how much the contractors, vendors, and others who provide products to them--how much thousands and thousands of people depend on that CEO knowing what he is doing and keeping it all afloat? How even a small mistake or judgment can be amplified many times over in a large chain and result in thousands of dollars of consequence?
Take one Applebee's entre. Included in the cost of that entre are the obvious food costs of course, but also the cost of the structural overhead, building costs and/or rent, utilities, maintenance, laundry and cleaning, non edible disposables, replacement costs, compliance with local, state, federal regulations, wages and all the add ons associated with that, training costs, a dozen or more different kinds of insurance, advertising, clerical, legal, and accounting costs, and dozens of different taxes ranging from income taxes to school bonds and lots more.
A CEO not only has to know how a new 5% tax will affect the bottom line in his direct operations, but how it will affect all the other expenses too. It is the rare individual with sufficient skill and know how to do that and can give his/her managers sound counsel on where to set their prices. And when the profit margin is around 3 to 4% which is typical of the average restaurant, a new 5% tax is a very big deal.
