Dubya
Senior Member
- Dec 29, 2012
- 3,056
- 59
My labor costs run about 35% because we are a fine dining restaurant. The general rule of thumb is that your prime costs (food cost & labor cost) should add up to somewhere in the 60 to 65% range in order to be profitable. If you have 10 employees being paid minimum wage (which is about what we do have) an increase of $1 an hour would mean an increase to our annual labor cost of approximately $20,000...and an increase of the magnitude that you are suggesting, $2 an hour, would cost me around $40,000 per year. That ISN'T small money. It's a lot of money in an industry where the typical profit margin for a fine dining restaurant is in the 4% range.
Do yourself a favor, Dubya...don't try to tell others how THEIR businesses should run when you REALLY don't understand the first thing about the industry that they are in!
You claim to have 10 employees making minimum wage in a restaurant and say they are working 2000 hours per year. I've been connected to many restaurants and they don't operate like that. People who work in restaurants don't work 8 hours, 5 days a week. I take it this is just one example of your restaurants you claim to own.
Your 35% figure is operating expenses, but that isn't all the expenses in the cost of doing business, is it? I notice you can't calculate a percentage increase in the cost of doing business or even calculate the percentage increase in the cost of labor.
As far as talking about increasing the minimum wage, that is just as much my business as yours. If you don't like the rules in this country, take your restaurant somewhere else! Do you think it's going to be missed?
Are you sure you are smart enough to own a restaurant?
Your word comprehension skills are rather lacking, Dubya. I SAID that my labor costs were in the area of 35% and that my prime costs (labor, food and alcohol) were in the 60 to 65% range. I have many other operating expenses. As I stated before, my profit margin is typically in the 4% range. Raising labor costs over 30% is going to mean that I'm going to have to raise my prices accordingly which means I run the risk of pricing myself out of the market for many people who are on fixed incomes...which here in the State of Florida is quite a few folks.
Are YOU sure you know enough about the restaurant business to try to tell someone who's made a career in the hospitality industy how they should be running theirs? I don't think you do, Dubya. I think you're pretty clueless about what the owners of MOST small businesses face these days because I don't think you've ever owned a business, let alone a restaurant.
My reading comprehension works fine and you are the one with the double talk. You claim to own restaurants and said one of those restaurants is for fine dining and has 10 minimum wage workers. Earlier you said only the dishwasher gets minimum wage, but it's possible to pay others minimum wage like a busboy or pay bartenders or waitresses minimum wage. Very few places do, because they rely on tip income. I don't think a service bartender would work for minimum wage, unless they received tips. How can people go to college and work 2,000 hours per year? I've done it and know what it's like to live on 4 hours of sleep a day for a year, but very few people can do it. What restaurant works their people 40 hours per week? Even fine dining has it's good days and bad, so people working during part of the week aren't going to be making good money. The good money tends to be around the weekend.