As I write this mid-April, 2018, the squeaks and squeals as well as the threat of fast food closings have lowered in social media volume to a dull roar. At the time of the Governments instituting the large minimum wage increase I did agree and sympathize that an aggressive timeline ito institute this policy was a little ambitious. The facts in my mind are however simpler: he tools were needed to bring those in poverty wage to a level barely above.
I find it difficult to have sympathy with business owners that only view their bottom line with disregard for the macro picture.
The are many ways that we all survive a rise in fixed cost, unexpected or not. My income has been relatively the same for past 7 years. It is what it is and we find ways to cut costs in many areas. My company does the same. As the world changes we look at more guerrilla marketing, push back against big corporate ad campaigns, run our outside parking lights on solar and many other cost cutting measures to keep our net margin dollars relatively the same or better.
I struggle with the math of a local general store/ice cream vendor in Enniskillen who was one very outspoken voice of raising the wages he pays his employees. He told the world in his social media lens that he would have to eventually close his doors because he would be required to raise his prices to a point where the families would not visit and buy his ice cream. He used fear to tell us that if a family drops visiting his establishment one time a month and comes only 3 instead of 4, that his business drops 25%. This is extreme panic math that we all use to sway an argument. Habits change, families dining health knowledge changes, gasoline prices affect families going out more, schools close, traffic patterns increase frustration in going to popular destinations and result in changes.
We all figure out ways to cut variable costs when fixed costs go up. You are assuming that we will not pay more (or visit less) when a big mac meal rises 30%. Business people who forecast by assumption are not in business very long. I would argue that business people with great social responsivity at greater costs than required do as well or better than those who live just by the rules required by law. I would also agree with the Henry Ford model of wages that showed parallel with wages and spending. Pay people more and they will spend more. The whole economy will benefit. We might even increase our visits for Big Mac now that the whole family is making a little more change.
Social responsibility of business and consumers, in my books, is doing what is best for the global citizens. I never use a drive thru as I view the carbon fumes that spew into the air from the 44 cars in the line up an assault. I walk into McDonalds every morning and watch the 4 or 5 “A” team members hustle to serve the cars, while the lone “B” teamer serves us socially responsible consumers our coffee and muffin.
If an ice cream vendor has to suffer a big cost increase as wages go up, then they need to figure it out. Make the scoop a little smaller. Negotiate harder with landlord for decrease. Negotiate better with suppliers on cost savings. Turn off more lights. Cut down on free. Use the cost in wage increase to your benefit: “Dear valued customer. While the wage increase is a major expense rise to our franchise, we feel that all citizens have the right to make a fair wage, and welcome the increase…” Watch the positive comments.
In 2006 the minimum wage was $8 an hour. 11 years later it is 11.40,
Gasoline prices at the pumps fluctuate, but averaged $.74 in 2006. Electrical costs have soared for those in homes and apartments. Natural gas prices have risen faster than inflation. Meat prices have risen 40%. Housing costs have gone up beyond the moon. Ask yourself as a respected citizens and business people or owners of a franchise if you have suffered as much as these people?
There is ballpark 2.7 trillion in the market in Canada unencumbered. I would make a pretty educated guess that this is not in RRSP, TFSA, RESP of the majority of Canadians who make less than $66,000 household income. Yet those who are part of this figure seem to be the one’s arguing against paying a few coins an hour more for those who do not have the above