[Timesink]

Benefits are a 'gift' that companies use to entice their employees to work for them, versus a competitor. They are not an entitlement. When unions 'demand' the entitlements, the company is forced to make a decision. Agree to the union demands, or take their company elsewhere.

The decision is usually quite easy to make. All the Kroger stores in my state are currently closed due to a strike over similar issues to the one described above. A couple weeks ago one of the local papers ran a huge page-one-above-the-fold article showing that the cost of the strike to Kroger was practically ZERO. Once you got past the relatively small initial loss from perishable goods that couldn't be sold (and most of that ended up being a tax writeoff because it was given away to charity), the amount of money Kroger saves from not paying its employees and from not having to pay taxes on unrealized sales is only a tiny bit more than the amount of profit they would have made had the stores stayed open. (Roughly speaking, the company's lost about a little over $1 million in profits during the two months the stores have been closed. The company's overall yearly income? $1.2 BILLION.)

The profit margin in the supermarket industry is very small, only 1 to 2 percent. With those sorts of numbers, the company has very little to lose by playing hardball.

[rb22982]

My upscale supermarket grocery store's gross profit before employees is around 43% for the store. After employees, building rent, elec, etc its around 18%-20%. We're pretty unique in the industry though. We pay off the cost to open a new store within about 9 months of being opened. We carefully pick where we open as well.