Spiteful business adds a "living wage" surcharge as a political protest

[halik]

Everybody knows for a fact that if Walmart and McDonalds began paying employees a living wage they would go out of business. Yet Costco, Trader Joes, In N Out can do that.

The solution to this is maybe passing a bill that allows the Costcos and Trader Joes of the world to use federal funds to conduct buyouts of Walmart and McDonalds.

Eventually we need to end Walmart and McDonalds, this would be a clear solution to allowing the better and more fairly run stores to be the most prominent.

Yes, because fast food joins operate with the same margins and price elasticity. I'm willing to bet that the median household income of a costco customer is double compared to a mcds customer.

 

[halik]

Did I say that?

I said that Costco and In N Out need to be given federal funds to PURCHASE Walmart and McDonalds.

If you look at Walmart and McDonald's balance sheet you see it is impossible for them to pay their employees a living wage, because they have lost the ingenuity that made them great in the first place. Time to move them into retirement. Let companies like Costco and In N out with ingenuity and talent run those businesses, and get America working for a livable wage.

So what you're saying we should let the free market / capitalism work by mandating how much they need to pay for their employees... right?

 

[thraashman]

They have 5 parking garages (all 24 hours), each with at least 1 cashier and 1 valet. That's 10 employees each getting a $6.00/hour raise, for a total cost of $1440. But is one valet really enough during peak times? Let's say for half the day, they have 2 valets per garage. That adds another $360 for a total of $1800, which is getting pretty darn close to the extra $1980 they are making if they park 2,000 cars a day.

If any of the shuttle drivers make less than minimum wage or they ever have more than 1 cashier or more than 2 valets at one garage, they probably aren't even fully recovering the added cost.

Alternatively, you can calculate the hours needed to park "thousands" of car. Let's say it takes 5 minutes to park + return a car. If thousands is 2,000, that is $1,000 in valet hours + $720 in cashier hours (assuming 1 cashier). Again fairly close to the $1980 extra revenue, so better hope those valets have 0 downtime during their 8-hour shift.

If thousands = 3,000, they are making $2970 per day and paying an extra $1,500 in valet hours + $720 in cashier. The more cars they park, the more likely they are actually making money, assuming again, the shuttle drivers were already making $15.00 and they run with a minimum staff of 1 cashier + minimum number of valets to park "x" cars at 5 minutes per car with 0 breaks.

All-in-all, I'd bet they aren't fully recoupling the extra cost in wages, which is consistent with the company's statement that the surcharge covers a "portion" of the increase in costs.

The thing to note is that if the company does go beyond recouping the costs and pockets the difference as profit, then having it spelled out as a line item on the receipt like this could constitute fraud if it doesn't go towards paying those wages.

 

[glenn1]

/THREAD

:thumbsup:

By the say, if you're going to put a line item on a receipt, 100% of that line item should have to go toward the item intended, period. Anything else is deceptive and borders on false advertising.

A receipt isn't advertising and the charge isn't deceptive since it's shown on the fee schedule portion of their website, but agree with your point about mixing business and politics. There just really is no business upside in doing this.

 

[Oldgamer]

If they park thousands of cars a day and are charging $0.99 a car. They would need to have hundreds of employees for this to be nothing more than a profit grab while blaming the wage increase.

That is exactly what this is a "profit grab".. but I suspect it will backfire on them.

 

[smackababy]

That is exactly what this is a "profit grab".. but I suspect it will backfire on them.

Please provide any reasonable reason how this is a profit grab besides the fact that "I think so!".

 

[BoberFett]

Please provide any reasonable reason how this is a profit grab besides the fact that "I think so!".

The rich! Profits! Koch Brothers! Bush! Rabble rabble rabble!

 

[boomerang]

What do you all think?

I think that if I owned a business that had a large, loyal customer base I would rather explain to them why prices have risen dramatically in writing on their receipt than to slow down the operation explaining it verbally or risk losing the business of those that don't ask and leave because they were uninformed. It's a damned if you do and damned if you don't situation but those that are blissfully unaware of current events need to know why the cost to leave their car there has increased.

 

[soundforbjt]

I think that if I owned a business that had a large, loyal customer base I would rather explain to them why prices have risen dramatically in writing on their receipt, than to slow down the operation explaining it verbally or risk losing the business of those that don't ask and leave because they were uninformed. It's a damned if you do and damned if you don't situation but those that are blissfully unaware of current events need to know why the cost to leave their car there has increased.

I keep looking for that on my grocery receipt, gas receipt, etc. It's never there though...

 

[TechBoyJK]

Unless politics is your business, don't mix business and politics. Pissing off half your customer base is never a good idea.

They'd be better off just raising their prices and say it's due to rising operational costs.

I work at a datacenter, and every 4-5 years we have to refactor how we bill our customers for power. We don't make money on power, so if the rate goes up anything significant, it affects our bottomline and we have to pass on the costs.

But we don't say it's a 'FUCKING SURCHARGE CAUSE OF DAMN AMEREN RAPING US"

We just say costs went up on a zero-margin service.

 

[Oldgamer]

They'd be better off just raising their prices and say it's due to rising operational costs.

I work at a datacenter, and every 4-5 years we have to refactor how we bill our customers for power. We don't make money on power, so if the rate goes up anything significant, it affects our bottomline and we have to pass on the costs.

But we don't say it's a 'FUCKING SURCHARGE CAUSE OF DAMN AMEREN RAPING US"

We just say costs went up on a zero-margin service.

LMAO...

 

[smackababy]

They'd be better off just raising their prices and say it's due to rising operational costs.

I work at a datacenter, and every 4-5 years we have to refactor how we bill our customers for power. We don't make money on power, so if the rate goes up anything significant, it affects our bottomline and we have to pass on the costs.

But we don't say it's a 'FUCKING SURCHARGE CAUSE OF DAMN AMEREN RAPING US"

We just say costs went up on a zero-margin service.

That is dumb. If you did, it would raise awareness that rising electric costs doesn't just effect how much you enjoy running the A/C in the summer. It effects businesses and that can raise prices.


But, this post demonstrates that raising the cost of any type of good (electricity, labor, materials), raises the overall cost of the product.

 

[hal2kilo]

Is it the line item that upsets you? Or paying more?

Line item.

 

[CPA]

They have 5 parking garages (all 24 hours), each with at least 1 cashier and 1 valet. That's 10 employees each getting a $6.00/hour raise, for a total cost of $1440. But is one valet really enough during peak times? Let's say for half the day, they have 2 valets per garage. That adds another $360 for a total of $1800, which is getting pretty darn close to the extra $1980 they are making if they park 2,000 cars a day.

If any of the shuttle drivers make less than minimum wage or they ever have more than 1 cashier or more than 2 valets at one garage, they probably aren't even fully recovering the added cost.

Alternatively, you can calculate the hours needed to park "thousands" of car. Let's say it takes 5 minutes to park + return a car. If thousands is 2,000, that is $1,000 in valet hours + $720 in cashier hours (assuming 1 cashier). Again fairly close to the $1980 extra revenue, so better hope those valets have 0 downtime during their 8-hour shift.

If thousands = 3,000, they are making $2970 per day and paying an extra $1,500 in valet hours + $720 in cashier. The more cars they park, the more likely they are actually making money, assuming again, the shuttle drivers were already making $15.00 and they run with a minimum staff of 1 cashier + minimum number of valets to park "x" cars at 5 minutes per car with 0 breaks.

All-in-all, I'd bet they aren't fully recoupling the extra cost in wages, which is consistent with the company's statement that the surcharge covers a "portion" of the increase in costs.

Make sure to include the employer payroll tax increases related to higher wages. And if any of his employees work overtime...

 

[BoberFett]

Line item.

As you can see from this thread, if the price went up without a line item, many people assume it's a "profit grab." Hell, even when the reason for the price increase is explained, many seem to think it's just greedy business owners wanting more money to swim through in their Scrooge McDuck money vault.

 

[Cozarkian]

Make sure to include the employer payroll tax increases related to higher wages. And if any of his employees work overtime...

I forgot about payroll taxes, that alone would close the gap between the increased revenue and added costs on the conservative estimate. Overtime I deliberately excluded because the employer can hire more workers and avoid overtime to keep the cost down.

However, in order to avoid overtime on the assumption of 2,000 cars per day @ 5 minutes each, he would need 29.2 valets. Assuming the valets accrue 40 hours of vacation annually, that's an added $6.00*29*40 = $6,960 annual cost, plus they need at least 21 cashiers to avoid overtime and keep all 5 parking garages open 24/7, which is another $5,040 annually in vacation if they get 40 hours. Then you need to pay someone to cover while the employee is on vacation, so those amounts double.

Yeah, this looks more and more like Masterpark is sharing at least some of the burden even after the extra surcharge.

 

[Vic]

As you can see from this thread, if the price went up without a line item, many people assume it's a "profit grab." Hell, even when the reason for the price increase is explained, many seem to think it's just greedy business owners wanting more money to swim through in their Scrooge McDuck money vault.

Prices go up all the time and people don't blame it on profit grabbing.
The last time Masterpark's insurance premiums went up, did they hit all their customers with an "insurance went up" surcharge?
When they had to give a dedicated employee a raise, did they have a "20 years with Bob" surcharge?
Of course not, right? So why now if not to make a political statement?
Which, as has already been pointed out, is always a bad business move if your business is not politics.

 

[Vic]

I wonder how many here actually fall for the old car salesman line that they can't sell a car to you at the price you offered because they're "into it for more than that." As if that even matters.

 

[momeNt]

So what you're saying we should let the free market / capitalism work by mandating how much they need to pay for their employees... right?

There is market capitalism and entrepreneurship and there is policy capitalism and entrepreneurship.

If In N Out were to convince the American people and government to provide them the money to purchase McDonald's and then transform them into the well run business that In N Out is that remains profitable and cost competitive to McDonald's and still pay their employees a livable wage. That is an example of policy entrepreneurship mixed with some regular market capitalism/entrepreneurship.

 

[drebo]

People who make Minimum Wage will still be poor regardless of what Minimum Wage is. Why do people have such a hard time grasping this?

 

[drebo]

When they had to give a dedicated employee a raise, did they have a "20 years with Bob" surcharge?
Of course not, right? So why now if not to make a political statement?
Which, as has already been pointed out, is always a bad business move if your business is not politics.

The expectation is that a 20 year veteran employee has the knowledge, skill, and experience to be efficient enough to deserve extra money, or has participated in the expansion of the business to cover the extra costs.

Raises are performance based for everyone except the government and unions. Low performance = low/no raise. So, no, your analogy doesn't work in this case.

 

[Vic]

The expectation is that a 20 year veteran employee has the knowledge, skill, and experience to be efficient enough to deserve extra money, or has participated in the expansion of the business to cover the extra costs.

Raises are performance based for everyone except the government and unions. Low performance = low/no raise. So, no, your analogy doesn't work in this case.

I don't think you understood the analogy that I was making.

 

[Vic]

People who make Minimum Wage will still be poor regardless of what Minimum Wage is. Why do people have such a hard time grasping this?

Because you don't grasp that the minimum wage isn't about poverty. It's about exploitation. Not everyone is negotiating from the same bargaining position.

 

[Tech_Greek]

The expectation is that a 20 year veteran employee has the knowledge, skill, and experience to be efficient enough to deserve extra money, or has participated in the expansion of the business to cover the extra costs.

Raises are performance based for everyone except the government and unions. Low performance = low/no raise. So, no, your analogy doesn't work in this case.

Correct. Your paycheck should be proportional to the value you provide the company. If you excel, so does your pay. If you remain loyal, the pay goes up.

It's a lot cheaper to give an employee a raise rather than start with a fresh one.

In the end, businesses are in business to stay in business and in order to do so they have to make profits or else Uncle Sam would go broke.

Personally, I've chosen to go another route with my business versus others and it's worked out very well. You have a low starting wage but make a bonus every paycheck that is directly proportational to a multitude of factors (attendance, performance, etc.) and my employees love it because they have no earning cap. It they go out there and bust their tail they will make more money on their paycheck - multiplier raises with length of employment and performance.

Most people will not understand why raising the wage isn't good for anyone unless they have or do run a business.

 

[Vic]

Correct. Your paycheck should be proportional to the value you provide the company. If you excel, so does your pay. If you remain loyal, the pay goes up.

It's a lot cheaper to give an employee a raise rather than start with a fresh one.

In the end, businesses are in business to stay in business and in order to do so they have to make profits or else Uncle Sam would go broke.

Personally, I've chosen to go another route with my business versus others and it's worked out very well. You have a low starting wage but make a bonus every paycheck that is directly proportational to a multitude of factors (attendance, performance, etc.) and my employees love it because they have no earning cap. It they go out there and bust their tail they will make more money on their paycheck - multiplier raises with length of employment and performance.

Most people will not understand why raising the wage isn't good for anyone unless they have or do run a business.

I love small business. That being said, you should know that large corporations use vastly different business models than small businesses do. Megacorps frequently layoff experienced employees to reduce their payrolls (and thus boost their stock price in the short term even if it costs them long term). They frequently pay employees without relation to their value. And they could not give a rats ass about loyalty (preferring to poach talent from their competitors).
So keep doing what you're doing. If everyone did it like you, we wouldn't even be discussing this. The problem is, almost no one does.