On Sat, 01 Nov 2014 21:26:45 -0400, Ed Huntress
wrote:

On Sat, 1 Nov 2014 17:46:29 -0700 (PDT), "
wrote:

On Saturday, November 1, 2014 5:44:04 PM UTC-4, Ed Huntress wrote:
d have to eat healthier foods. Win/win, wot?

While you're practicing your arithmetic, you might want some
real-world prices to put into your homework.

Fast-food restaurants' average labor costs -- total, front- and
back-operations -- run around 25% of sales.

McD's workers average around $8.50/hour. Figure one manager for eight
employees (which is about right), at $11.50/hour, you get an average
of $8.83 for all employees. That represents $1.00 of a $3.99 Big Mac.

If you raised them all to $15.00/hour, that would add $0.80 to the
price of that burger: It would sell for $4.79.

That's significant, but before you start thinking "$20 burgers," try
running the numbers and get real.

--
Ed Huntress

Are your labor costs including the cost of benefits?

That's a figure I got from a trade association. It's supposed to be
total labor costs per restaurant, across the fast-food indisutry.
Another source said that the restaurant industry as a whole averages
33%. Fast-food outlets are more efficient, as one would expect.

And how many businesses are going to raise the cost of the burgers above that $4.79 and blame the extra price increase on the minimum wage increase?

As; many as can get away with it. And if they *do* get away with it,
it tells us that labor was underpriced before the increase.

Ed, is that the total cost of labor, or only salaries? If total cost
it seems surprisingly low, at least based on what the costs were in
Indonesia when I worked there.
--
Cheers,

John B.