General Discussion
In reply to the discussion: Fast-Food Strikes Expand Across U.S. to 50 Cities [View all]SunSeeker
(51,864 posts)Last edited Sat Aug 31, 2013, 06:11 AM - Edit history (1)
I don't know where you get your figures from, but Janney Capital Markets puts labor costs for US franchises at 24 percent of sales.
And for company owned stores, the 17 percent-of-revenue labor figure was obtained by dividing payroll and benefits at company-operated restaurants by total revenues. Critics of the study, like the Columbia Journalism Review, argued that the labor figure for company-operated stores failed to include the executive comp and the pay of folks in Chicago who run marketing. I don't think it is that big an error since those folks' salaries would not be doubled if the lowest paid workers actually got a raise to $15/hour. But even if you did include these high paid execs, that would raise the labor costs to 25% of revenues, which is on par with the franchises' labor costs. Using that 25% figure, the Big Mac would have to go up a full dollar, rather than 68 cents, to cover everyone (including execs) having their salary doubled at a company-operated store.
The Columbia Journalism Review crunched the numbers:
http://m.cjr.org/303546/show/3dc3f689385c40a23d3a7baeefc7e03a/?