This is completely absurd! There is no doubt in my mind that small franchisees in Seattle will be closing stores and relocating. I could only imagine that the level of unemployment will rise very quickly due to businesses laying employees off because they can’t afford the higher overhead costs. Another effect will be a hike in prices of goods and services. I did a little calculation and I found that the cost of living in Seattle is about 35% higher than in Orlando, Florida. The minimum wage here is normally around $8 an hour, this would be equivalent to $10.84 an hour in Seattle. Just something to think about. It is clear from the judges determination that “franchisees receive enough help from their relationship with franchisors to allow them to pay the higher wage,” he has no clue how franchising really is in a lot of cases. It looks as though the judge needs to go back to school and take some classes on basic economics and business. As do all the other people that pushed for such a rash wage hike. I do agree that the minimum wage needs to be equal to a livable wage but it needs to be in stages.
I find this to be a very interesting post, because it demonstrates the lack of knowledge people have on the franchise business model. As Bundy mentioned, people hear the word franchise and the first thing that comes to mind are huge corporations such as McDonald's or Subway and a lot of money in their pockets. What people don't know, is that franchisees are small business owners who most of the time are investing a big percent of their savings in order to manage their own business. This people does not necessarily have to be wealthy. This law being implemented in Seattle most sound ridiculous to anybody who has at least a little knowledge on how a franchise works. The only one who ends up loosing money in this situation is the franchisee.
This article clearly shows that people still don't understand franchising very well. $15 an you minimum wage is absurdly high and will hurt the wrong group of people. It won't bother the big franchises like McDonalds, Dominos, Subway, etc. it will hurt the smaller franchises that are everyday working people. The small business franchises will definitely consider relocating which will hurt business in general in Seattle. This decision really should be looked at and considered a lot more considering the fact that all the wrong people are hurt by this new policy.
This lawsuit didn’t challenge the $15 minimum wage law in its entirety; just the provision of the legislation that treats hotel and fast food franchises differently than other small, local businesses simply because they’re associated with big corporations. What is ridiculous is that Franchise businesses—even though they employ fewer than 500 workers—must abide by the large employer deadline if they’re affiliated with big brands. As Jarett previously mentioned, it definitely is going to hurt business in Seattle. There will not be any new opening business and many of these smaller business may even relocate after their contract or they will just end up having to go into foreclosure, which is not a good business mantra that Seattle should be showcasing for the sake of the future of business in that city.
This is completely absurd! There is no doubt in my mind that small franchisees in Seattle will be closing stores and relocating. I could only imagine that the level of unemployment will rise very quickly due to businesses laying employees off because they can’t afford the higher overhead costs. Another effect will be a hike in prices of goods and services. I did a little calculation and I found that the cost of living in Seattle is about 35% higher than in Orlando, Florida. The minimum wage here is normally around $8 an hour, this would be equivalent to $10.84 an hour in Seattle. Just something to think about. It is clear from the judges determination that “franchisees receive enough help from their relationship with franchisors to allow them to pay the higher wage,” he has no clue how franchising really is in a lot of cases. It looks as though the judge needs to go back to school and take some classes on basic economics and business. As do all the other people that pushed for such a rash wage hike. I do agree that the minimum wage needs to be equal to a livable wage but it needs to be in stages.
ReplyDeleteI find this to be a very interesting post, because it demonstrates the lack of knowledge people have on the franchise business model. As Bundy mentioned, people hear the word franchise and the first thing that comes to mind are huge corporations such as McDonald's or Subway and a lot of money in their pockets. What people don't know, is that franchisees are small business owners who most of the time are investing a big percent of their savings in order to manage their own business. This people does not necessarily have to be wealthy. This law being implemented in Seattle most sound ridiculous to anybody who has at least a little knowledge on how a franchise works. The only one who ends up loosing money in this situation is the franchisee.
ReplyDeleteThis article clearly shows that people still don't understand franchising very well. $15 an you minimum wage is absurdly high and will hurt the wrong group of people. It won't bother the big franchises like McDonalds, Dominos, Subway, etc. it will hurt the smaller franchises that are everyday working people. The small business franchises will definitely consider relocating which will hurt business in general in Seattle. This decision really should be looked at and considered a lot more considering the fact that all the wrong people are hurt by this new policy.
ReplyDeleteThis lawsuit didn’t challenge the $15 minimum wage law in its entirety; just the provision of the legislation that treats hotel and fast food franchises differently than other small, local businesses simply because they’re associated with big corporations. What is ridiculous is that Franchise businesses—even though they employ fewer than 500 workers—must abide by the large employer deadline if they’re affiliated with big brands. As Jarett previously mentioned, it definitely is going to hurt business in Seattle. There will not be any new opening business and many of these smaller business may even relocate after their contract or they will just end up having to go into foreclosure, which is not a good business mantra that Seattle should be showcasing for the sake of the future of business in that city.
ReplyDelete