Alex Johnson owns 10 Auntie Anne's Pretzels and Cinnabon restaurants in the San Francisco Bay Area. He said sales have slowed in 2024, prompting him to lay off his office staff and rely on his parents to help with payroll and human resources.
Increasing his employees' wages will cost Johnson about $470,000 each year. He will have to raise prices anywhere from 5% to 15% at his stores, and is no longer hiring or seeking to open new locations in California, he said.
“I try to do right by my employees. I pay them as much as I can. But this law is really hitting our operations hard,” Johnson said.
“I have to consider selling and even closing my business,” he said. “The profit margin has become too slim when you factor in all the other expenses that are also going up.”
This sure is a surprising and unforeseen circumstance.
Is this the law that big donors in California were exempted from, or was that some other law?
Which is why minimum wage is actually $0. They can’t make money if they don’t have an employer.
NOT surprising for someone like me who has done accounting for over 66 years.
That loud slamming sound is that of fast food franchises closing their doors all over California for the last time.
Economic reality can be a terrifying thing to live with, especially when the business plan is inflexible or not well thought out.
The average profit margin for a fast food restaurant in San Franciso is between 6 and 9%. So if that drops, then you are not outpacing inflation.
Most of those businesses, not only in San Francisco, will close down.
Minimum wage jobs are not meant to be career jobs. That’s why they have high turnover, and pay low.
$20 an hour is $41,600 a year. The price of the food will sky rocket, and less people will eat there. Thus, means they will have to have shorter hours and less employees.