Seattle ZPizza closing due to minimum wage increase?

[RPCLady]

I tried to search the forums to see if anyone had already posted this news about ZPizza closing its doors in Seattle. First I was not aware this was a franchised business. My extended family lives not far from there and had told us they loved the pizza (and we have a menu they sent us, its very pricey) even with the higher costs for the pizza there, I guess they aren’t wanting to deal with the City’s new ordinance that makes minimum wage $15/hr…

http://www.thefederalistpapers.org/...nt-up-april-1-then-companies-starting-failing

 

[GotRocks]

If that hits my area, I’m done. If I am forced to pay entry level people $15/Hour, where does that put my top performers wages at to be fair to them?

I cannot imagine paying a dishwasher who is darn near next to useless $15/Hour, and what, I’m supposed to pay my pizza cooks $26-$29/Hour to be fair to them.

This is the same as printing money with nothing to back it up, all associated costs and prices will rise accordingly and we will just see massive inflation across the board. The only places that will prosper are those who have near total automation.
I’ll leave my personal political views and rantings out of this to not start arguments, but I cannot imagine many owners not sharing the same general fiscal views as I do.

 

[RobT]

I will either close the doors or shut down delivery and layoff 75% of my staff.

 

[bodegahwy]

To be the devils advocate here… and in fairness, we are already closer to the $15 mark than most, if this were to happen where I am and a couple of places closed, I would have more than enough business to afford to pay my cooks $15. I already pay them $10-$12 and my full timers get $13-$15. Put in another way, the wage earners that account for 80% of my wages already earn at least $13. Drivers would be another challenge. I guess tip reporting would have to seriously improve with regard to documenting what they make and proving that they are doing better than $15. The increase for the cooks that make $10-$12 would cost me a manageable amount of money. I think I would more than make up if even one competitor bailed. Or… increase prices by $1 per pizza and move on. That would more than cover it for me.

To address Got-Rocks point (except that we do not have dishwashers) I can recognize better talent with another $1 or $2 per hour and I think I would be OK.

 

[pizzapiratespp]

http://seattle.eater.com/2015/4/29/...announces-closure-due-to-new-minimum-wage-law

Here is the news story. This one sounds legit. Most of these stories are concocted. This pizza place was at around $9.50 hour just a short time ago and is now being forced to $15 in just 24 months time. That’s too short a time to adjust your prices and and not chase off customers.

We have 2 different pieces of legislation moving thru the system in California right now to raise the minimum wage.

One is to raise it to $11 on Jan 1 2016 and then to $13 on Jan 1 2017
The second is to raise it $1.00 a year until it gets to $15

I would prefer the second one. It would give us time to get the customers adjusted with small price increases. For us to go to $13 in 18 months would be tough.

These bills are sponsored by the SEIU union. They have some clause in their contracts that give their members a raise if minimum wage goes up.
http://abc7chicago.com/news/seiu-spending-millions-on-minimum-wage-movement/662699/

The Z Pizza is a franchise. Franchises are the ones that are really going to get hit hard, because of the royalty fees that are paid. I’m also interested in seeing how the $5 pizza places handle this too.

Here is great explanation of the union tactics
http://workplacechoice.org/2015/04/14/seiu-support-for-minimum-wage-hikes-based-on-self-interest-2/

 

[bigmoose]

…This is the same as printing money with nothing to back it up, all associated costs and prices will rise accordingly and we will just see massive inflation across the board. …

You are closer to the truth than you may know. With the US and world economy sputtering and actually turning down a bit, The Powers That Be are terrified of deflation and negative interest rates. They have been trying to up inflation for 6 years now with little success. This is a way to transfer other peoples capital investment money into wages which has a higher potential for driving up inflation.

 

[GotRocks]

@bodegahwy
We are a unique situation in my area where we have a constant shortage of available competent labor, many places here have gone to paying cash nightly just to get people in the door, they get paid that night, they use the money to go buy a bag of weed, and they don’t see them again, because when they run out of their bag, they go to one of the 68 other restaurants in a 10 mile radius (in a town of only 7200 people) and do the same thing at another restaurant, and they are happy to have them for a night or two. They can work at 2 different places per week and never repeat at the same employer. I refuse to pay cash and deal with that!
We pay top wages for the area, but I also demand top performance for it, not some slug.
Alright, somehow I got into rant mode, I’ll stop now/

I’ve tried to import seasonal people from large midwest towns to work in summer, but the housing up here is unaffordable to house them, or for them to pay rent on their own. I’ve only started one person at minimum wage, he was with a occupational rehab program, knew nothing, unable to learn anything, and couldn’t work without constant uninterrupted supervision. he was more of a hassle than any help at all, me and the kitchen crew decided we’d take shifts doing warewashing instead of having this guy in our way, and having to fix his screw ups. It became a serious safety issue even having him here.
My latest applicant had several convictions for forcible rape with great bodily harm, multiple thefts, credit card fraud etc etc etc we’re an open kitchen restaurant, thats all I need is for one of his victims to come in and see that here. We’d be done forever in this area.

 

[Joe]

http://seattle.eater.com/2015/4/29/...announces-closure-due-to-new-minimum-wage-law

Here is the news story. This one sounds legit. Most of these stories are concocted. This pizza place was at around $9.50 hour just a short time ago and is now being forced to $15 in just 24 months time. That’s too short a time to adjust your prices and and not chase off customers.

We have 2 different pieces of legislation moving thru the system in California right now to raise the minimum wage.

One is to raise it to $11 on Jan 1 2016 and then to $13 on Jan 1 2017
The second is to raise it $1.00 a year until it gets to $15

I would prefer the second one. It would give us time to get the customers adjusted with small price increases. For us to go to $13 in 18 months would be tough.

These bills are sponsored by the SEIU union. They have some clause in their contracts that give their members a raise if minimum wage goes up.
http://abc7chicago.com/news/seiu-spending-millions-on-minimum-wage-movement/662699/

The Z Pizza is a franchise. Franchises are the ones that are really going to get hit hard, because of the royalty fees that are paid. I’m also interested in seeing how the $5 pizza places handle this too.

Here is great explanation of the union tactics
http://workplacechoice.org/2015/04/14/seiu-support-for-minimum-wage-hikes-based-on-self-interest-2/

SF min wage just went up yesterday from $11.07 to $12.25. Raised prices 10% to offset the labor. Luckily for the pizza business, cheese prices have come back down to earth. Paying $2.20/lb the past few months. Keep your workplace efficient and raise prices each time there is a wage hike and you’ll be fine. I don’t agree with the aggressive schedule of increases but I’m sure as shit not going to close my doors because of it! Cheap places will get hit harder on this than quality places. Make quality pies!

 

[pizzapiratespp]

SF min wage just went up yesterday from $11.07 to $12.25. Raised prices 10% to offset the labor. Luckily for the pizza business, cheese prices have come back down to earth. Paying $2.20/lb the past few months. Keep your workplace efficient and raise prices each time there is a wage hike and you’ll be fine. I don’t agree with the aggressive schedule of increases but I’m sure as shit not going to close my doors because of it! Cheap places will get hit harder on this than quality places. Make quality pies!

Are there any discount pizza shops on San Fran? Like Little Caesars? I’m curious how they are dealing with this. One of our locations has seven $5 pizza shops in its trade area. I’m thinking this is all going to mean then end for these guys.

 

[pizzanow]

I assume those $5 shops will become 7 or $8 shops… and with the price increases of all other places, they’ll still be the ‘cheap’ option, it’s not a convenient $5 bill anymore but I don’t see the market going away for cheap pizza. LC is going the way of Subway (although not as fast) and you see commercials for 8-13.00 pizzas now as opposed to 5. My buddy owns an LC and with the recent push to more expensive pizza he’s now been running food cost below 30% when it used to be 35-37. I know some say the franchises will be hurt by this the most, but I feel they’ve been raking it in for quite a while and they can afford to outlast some independents that will have to raise their prices immediately.

 

[mat_lesh]

To be the devils advocate here… and in fairness, we are already closer to the $15 mark than most, if this were to happen where I am and a couple of places closed, I would have more than enough business to afford to pay my cooks $15. I already pay them $10-$12 and my full timers get $13-$15. Put in another way, the wage earners that account for 80% of my wages already earn at least $13. Drivers would be another challenge. I guess tip reporting would have to seriously improve with regard to documenting what they make and proving that they are doing better than $15. The increase for the cooks that make $10-$12 would cost me a manageable amount of money. I think I would more than make up if even one competitor bailed. Or… increase prices by $1 per pizza and move on. That would more than cover it for me.

To address Got-Rocks point (except that we do not have dishwashers) I can recognize better talent with another $1 or $2 per hour and I think I would be OK.

I don’t thin

To be the devils advocate here… and in fairness, we are already closer to the $15 mark than most, if this were to happen where I am and a couple of places closed, I would have more than enough business to afford to pay my cooks $15. I already pay them $10-$12 and my full timers get $13-$15. Put in another way, the wage earners that account for 80% of my wages already earn at least $13. Drivers would be another challenge. I guess tip reporting would have to seriously improve with regard to documenting what they make and proving that they are doing better than $15. The increase for the cooks that make $10-$12 would cost me a manageable amount of money. I think I would more than make up if even one competitor bailed. Or… increase prices by $1 per pizza and move on. That would more than cover it for me.

To address Got-Rocks point (except that we do not have dishwashers) I can recognize better talent with another $1 or $2 per hour and I think I would be OK.

I am pretty sure that as one pizza ,or restaraunt

To be the devils advocate here… and in fairness, we are already closer to the $15 mark than most, if this were to happen where I am and a couple of places closed, I would have more than enough business to afford to pay my cooks $15. I already pay them $10-$12 and my full timers get $13-$15. Put in another way, the wage earners that account for 80% of my wages already earn at least $13. Drivers would be another challenge. I guess tip reporting would have to seriously improve with regard to documenting what they make and proving that they are doing better than $15. The increase for the cooks that make $10-$12 would cost me a manageable amount of money. I think I would more than make up if even one competitor bailed. Or… increase prices by $1 per pizza and move on. That would more than cover it for me.

To address Got-Rocks point (except that we do not have dishwashers) I can recognize better talent with another $1 or $2 per hour and I think I would be OK.

As each of these competitors closes, a new will open. Pretty sure that is not going to do much over time. In the mean time, all will have to raise the price from what I figure by at least 20% just to make the profit you see now.

 

[Grokster]

We are currently dealing with the same pending legislation in Alberta. We recently had a huge “upset” victory for a democratic party in a province that has been traditionally conservative for 45 years.

One of the “promises” is to up min wage to $15.00 an hour. For us that will be an increase in wage in the ballpark of 25-35% as all of my employees make more than min wage ($10.20).

Talking to my baker here in town his wages will go up $2000 a year for each $1.00 the min wage increases per employee.

No questions here, this is going to hinder business/progress in our province quite a bit.

The “reinvestment” part of their propaganda is a load of horseshit too; the only reinvestment is going to be higher tax volume paid to the government from every business owners pocket.

Might as well just add a sales tax, its the same damn thing.

You’ll have to excuse this bitter canuck, this is all still fresh to me!

EDIT: Daddio, how are you dealing with the news? Moving to Saskatchewan? Better yet… BC will have the same economic environment AND have beautiful women in bikinis. Up for a joint-venture in Kelowna?

 

[royster13]

Grokster where are you located?

 

[Grokster]

Red Deer, Ab

 

[royster13]

Been there…Done that…Get back there on occasion as I have friends and family there…

 

[Grokster]

That sounds like free shipping if I time my order properly!

 

[Smokin]

If $15 per hour is good then why stop there? How about $20 or $30 per hour. Heck lets get it up to $50 bucks an hour where all non skill labor can make a good living. Progressives just do not understand Capitalism and the free market place. When a McPuck hamburger costs $20 and all of the business close their doors perhaps they will wake up but I doubt it. One just has to either bite the bullet and absorb the increase labor cost or adjust the price of the food to make up for it. You can go broke setting at home instead of working your butt off and going broke.

I return you to your regular scheduled topic. Rant is over!

 

[pizzapiratespp]

Most of the talk in California and wage increases revolves around getting people off of government assistance. Getting off the dole so we can reduce our tax burden. Yet there seems to be nothing in these bills that reduces taxes if the wage increases are passed.

Back in the early 80’s I made minimum wage. It wasn’t enough to live on nor did I feel it should be. The work I did ( sweeping floors and taking out trash ) didn’t warrant more pay. It took zero skills and very little responsibility. I offered myself to my employer to take on more responsibility and low and behold they gave me more money. Within and year I doubled my pay and I had enough to live on. What a concept.

 

[Daddio]

EDIT: Daddio, how are you dealing with the news? Moving to Saskatchewan? Better yet… BC will have the same economic environment AND have beautiful women in bikinis. Up for a joint-venture in Kelowna?

I’m not happy with the situation we are in. I am looking at what my options are. Maybe early retirement. I am amazed that people are so uneducated as not to understand that an increase in minimum wage is nothing but a catalyst for inflation.

 

[RPCLady]

Its because they’ve been trained to falsely believe that they ‘deserve’ better pay, they do not understand the concept of ‘earning’ their pay, they ‘expect’ to be handed their pay regardless of their performance. Plus, here in our rural town, the hotel and the burger place seem to always need to hire, they can’t get a good worker in the first place, and they do their diligence to keep the good ones for as long as they can. Our problem is population to restaurant ratio… in our tiny community we have too many restaurants… (and too many duplicate menus! Insanity at its finest) We get by on just our family working, and in the busy season we do have one part time employee that spends his winters down in AZ. He’s warned us that this is his last year, he won’t be coming back next yr. So, that means we’ve either got to find another trustworthy employee, or?? sell the place?? or?? who knows… I wish we had better options. People around here have this false notion that business owners make oodles of money and that we’re the selfish and greedy ones… if you translate my income into an hourly wage, I make maybe $1.50 /hr. They just do not understand economics at all.

I would like to see those $5 pizza franchises gone. People in my community think we’re ripping them off because we don’t sell $5 pizzas and they have to wait 20 min for theirs to be made… Give me a break!

My guess is those franchises will likely just go to a kiosk system like Chilli’s restaurant has started. I saw their ad for their ‘new innovation’ in service…blah blah blah… order at your table with a touch screen, and pay at your table with your CC, and the only time you see a server is when the food is brought out to you and that’s it… one server could probably handle the whole dining room… cutting employees is the name of the game for most businesses that are forced into that wage increase.