Minimum wage hikes sending restaurants the way of the shopping mall?

Fox Business ^ | 2018 January 15 | Brittany De Lea

[CutePuppy]

Eighteen states raised their minimum wages at the start of 2018, but increasing labor costs are strangling the dining industry so much that restaurants could soon face the same fate as shopping malls.

"I think you're going to see thousands of restaurants close their doors," Willie Degel, "Restaurant Stakeout" host and CEO of Uncle Jack's Steakhouse, told FOX Business. "Fine dining is going to go by the wayside."

The downward cycle seems daunting to Degel and other industry insiders. As costs rise, only so much of the burden can be passed along to consumers in the form of price hikes before they decide they cannot afford the expense.

"When we increase in prices ... we see guest count go down," Degel noted. "The consumer is not willing to pay for the experience then." ..... < snip >

..... In addition to raising prices, businesses often cope with minimum wage increases by firing staff. Last week, casual dining chain Red Robin Gourmet Burgers (NASDAQ:RRGB) announced it would eliminate busboy positions at 570 restaurant locations. Degel said he got rid of busboys at his New York restaurants two years ago, and has more recently turned to staff cuts "across the board." ..... < snip >

..... Many business owners have turned to technology to both compensate for the loss of labor and to reduce expenses. Some restaurants, including Chili's and Applebee's, have already replaced servers with tableside tablets for placing orders and paying bills. ..... < snip >

..... In addition to the 18 states and 20 cities that raised their minimum wages on Jan. 1, three more states will implement a hike later this year. ..... < snip >

[Susquehanna Patriot]

Regarding the Australian Model . . .

I occasion a southern bbq restaurant with several locations. It uses this model, except they will come by to ask how you are enjoying the food, ask if you need anything else, will bus the table, and after you leave will finish cleaning the table, wiping it spotlessly clean. The manager also walks around (is engaged / present) and may welcome you on the way in or thank you on the way out. Never engaged an employee with a bad attitude - all very positive. But they are not in your face / making a pest of themselves. Food is above average. And they also have a drive through in case you cannot come on in to sit down.

[central_va]

Unions are dead. You are fighting the last war.

[mad_as_he$$]

Fine dining will not go away. The great mom and pop diner will, but they were already in trouble.

[Alas Babylon!]

Well, coming from Barney, he has a point.

For example, government sure likes to give anal to the citizens!

[varon]

"Fine dining is going to go by the wayside."

True but not primarily because of wages. Fine dinning is diminishing in direct proportion to how many consumers are getting used to finger foods wrapped in deli paper with side dishes of potatoes in cardboard pouches. More and more consumers don't know how to 'set a table' nor how to properly use the 'silverware'.

There is a diminishing need for white tablecloth fine dining restaurants as the 'coat & tie' customers are replaced by the 'hoodie & T-shirt' crowd. What once was referred to "After Six" elegant attire for an evening out , now refers to changing to fresh/clean underwear etc "After Six" days of wear.............

[Thibodeaux]

Induced inflation to cause general inflation that will solve many democrat problems.

Also, the general inflation will reduce the national debt.

[Ge0ffrey]

This works great for the chain restaurants and poorly for the mom and pop businesses. The large chains flush with cash then lobby Congress for more of this kind of legislation, and back candidates that give them even more legislation conducive to their businesses, and there you have it — crony capitalism aka progressive fascism.

[Larry Lucido]

People wait in line cafeteria style to get their food and take it someplace else to be eaten.

Some of those places are great, but the owners can be temperamental.

[PeteB570]

Have a place here in town, Mission BBQ, with a military theme.

Place your order at the counter, pick a table and when they call your name go back to the counter and get your tray. Drinks are at the soda machine in the dining area. Bus your own table.

Always near capacity - and all the workers friendly.

[trebb]

Yep - and then they raise the wages to make up for that and then tips are phased out and they have to raise wages again, and a lot of worthless servers get decent wages for being bad for the business...what a vicious circle....

[CarolinaPeach]

Not everyone is too fat. There are also several restaurants around here that are known for their large portions. Many older people like to frequent those places because they know they will take home leftovers for another meal. Piles of beans, potatoes, corn, peas, greens, and other such plain fare don’t cost a lot to serve.

On the other hand, with American servers being used to getting tips, I think a business owner who had been forced to pay a $15 min wage and who put up a sign that tipping was not allowed would get lots of whining and complaining about how the servers were still being under paid without their tips. If it were my business, I would invite the servers to find more rewarding and less abusive employment elsewhere.

Now I’m wondering when all the people working those jobs at what was previously a non-living wage and who received supplemental government assistance will receive a congratulatory letter for their advancement and notification that they no longer qualify for any type of assistance. Now that they are receiving a living wage, they don’t need free stuff, right Hollywood celebrities and lefty activists?

Peach

[yefragetuwrabrumuy]

I remember that years ago in Phoenix, somebody actually did the math and found out that within six months after opening, half (50%) of all new restaurants failed. Within a year, half the the remainder failed as well.

When there is such a brutal market, it is very sensitive to any changes that make their business harder.

[Texaspeptoman]

Sounds like breakfast time at Dan’s Hamburgers (Austin) - some good eatin’

[reformedliberal]

What once was referred to “After Six” elegant attire for an evening out , now refers to changing to fresh/clean underwear etc “After Six” days of wear..........
_________

Good snarks are based in truth. I have noticed an increase in *Life Hacks* that advise less washing of clothing(a look at laundromat prices can explain this)...put jeans in the freezer, use spot cleaners if essential, spend more for fabrics said to kill bacteria & therefore save time/money/water in the long run w/less washing; air bedding (and there are many places now with no dry cleaning available for down-filled items). No one irons (including me). The woman who cuts my hair now advises shampooing weekly, only.

Jeans and a “nice” shirt/sweater (or one with a catchy slogan)is considered adequate for most people, most times.

Last time we went to a restaurant with a $40-$60/person price point, I saw no one in a suit. Although some woman were in work attire of dress and heels, not one male wore a suit jacket, sport coat or blazer. Shoes are ubiquitous expensive *trainers* and in summer, the loathsome flip-flops.

But: every woman under fifty is wearing a ton of time-consuming make up and there is very little natural-colored hair.

We cook better than most restaurants and for me, $10 is the upper limit for a good-to-great burger w/no sides included. I have relatives who eat out 5 times a week because wife doesn’t know how to cook and husband is tired of cooking. Ironically, they live in suburban Chicago and complain endlessly about the “Republican tax cut” costing them “thousands”.

[FreedomPoster]

Food trucks are a “thing” even in areas without a minimum wage. Atlanta has tons of them, for example. And these are not at all your construction site roach coaches from days of yore. I’ve had wonderful lobster rolls, burgers, tacos, sushi, etc. from food trucks.

Our town has one evening a week from early Spring through late Fall where there is a food truck event at a city park. It is quite well attended.

[oldasrocks]

This is all good news. There will be a lot of building that can be turned into homeless shelters that have kitchens to serve them.

[GailA]

When you factor in age, cost of ticket, refreshments, conditions in theaters lack of lighting, sound, and other goers not controlling their cells, feral youths breaking out into dangerous gang fights and younger kids misbehavior etc, Seniors stopped going as it is no longer a pleasure.

Considering the big FLOPS this last year, not many were worth going to.

I can wait 3 months and buy the Video if necessary cheaper than 2 people going to a brick and mortar place. And with the benefit of pause, can stop a movie and answer the phone, refresh drinks, or go to the RR. More than likely borrow it from one of our own adult children.

[Yosemitest]

Minimum Wage should be DEAD ON ARRIVAL .

[GailA]

Same here, 1 poor quality sit down with a buffet style. Prices over rated for quality of food.

Rest are Fast Food ranging in DQ-McD’s types and take/order pizza ALA Dominos style. 1 Mom & Pop run bar that serves great Catfish and BBQ just outside of town reasonable prices.

Want better, 2 hr drive, better be Locked and Loaded packing. Memphis is NOT the place to be after 6. Then you are not getting better than Chili’s, O’Charley’s, Olive Garden type. You learn to avoid crap like the Rendezvous that serves dry tough, cold ribs/chicken served on Styrofoam plates with plastic utensils.

[Ciexyz]

People keep giving me gift cards to a family restaurant that has chains all over town. This is all well and good but I don’t eat out that much anymore and have to wait for friends getting together and choosing this particular restaurant, because I don’t like to dine alone. Recently the chain instituted a drive-through window and that solved my problem. I love the drive-through service.