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Read previewA California franchisee has warned that some of his customers think fast food is becoming a "luxury" as restaurants increase prices to cover the state's new $20 minimum wage for fast-food workers. AdvertisementThe new wage in California comes amid rising prices of fast food across the US more generally. A combination of wage and food inflation pushed prices up during the pandemic, and some diners say they're cutting down on how much fast food they eat because it's no longer affordable. "The appetite that my customers have for price increases is not unlimited," Scott Rodrick, a McDonald's franchisee with 18 restaurants in northern California, previously told BI. Is fast food no longer affordable?
Persons: , Brian Hom, I've, Scott Rodrick, Tony Nix Organizations: Service, Business Locations: smoothie, San Jose, California
The popular menu item, plus a $15 million ad buy, could boost sales by 10%, according to Bloomberg. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementCalifornia's newly enacted fast food wage hike is already having an effect, though not one lawmakers likely had in mind when writing the law: bagels are back at McDonald's in the state. Related storyMcDonald's told Business Insider that the team's recommendations were based on best practices from other locations where restaurant operators have had to navigate local wage hikes. Scott Rodrick, who owns 18 McDonald's locations in the state, told Business Insider he's already raised menu prices between 5% and 7% since January, but there is a limit to the prices his customers will pay.
Persons: , Scott Rodrick, he's, Kerri Harper, Howie Organizations: Bloomberg, Service, Golden State, KTLA News Locations: California, McDonald's
Fast-food franchisees in California fear diners will flock to Chili's and Applebee's to avoid price hikes. As a result, the price gap between fast-food and casual dining restaurants could narrow. This could potentially cause the price difference between fast-food and casual dining restaurants to shrink. Fast-food restaurants in California have been hiking prices to offset the wage, which is 25% above the state's general minimum wage. "We're gonna start to compete with them," Ghai said, speaking about the casual dining restaurants.
Persons: , Shane Paul, Paul, Scott Olson, Taco Bell, Ghai, he's, wouldn't, Scott Rodrick, Rodrick, Hajime Uba, Brian Vaccaro, Raymond James, Sal Vitalie, Vaccaro, Sharon Zackfia, William Blair Organizations: Service, Burger Locations: California, San Diego, South San Francisco
Read previewFast-food franchisees in California are desperately looking for ways to cut costs as the state's $20 minimum wage for workers at limited-service restaurants kicks in. Mendelsohn, the El Pollo Loco franchisee, told NPR that her preemptive price increases had already deterred some customers. William Blair analyst Sharon Zackfia expects some restaurants in California to turn to digital kiosks as labor costs rise. Spending less on operationsBeyond labor, restaurants are looking for other ways to save on their operating costs. Alex Johnson, the Auntie Anne's Pretzels and Cinnabon franchisee, told the AP that he wasn't looking at opening any more locations in California.
Persons: , Michaela Mendelsohn, Alexi Rosenfeld, Alex Johnson, Anne's Pretzels, he'd, Marcus Walberg, Mendelsohn, Brian Hom, Walberg, Sharon Zackfia, William Blair, Grace Dean, Kris Stuebner, Scott Rodrick Organizations: Service, Business, El, Loco, NBC Los Angeles, Associated Press, El Pollo Loco, NPR, Wall Street Journal, CNN, KFC, Management Corporation, ABC, Fox News, AP Locations: California, Los Angeles County, Los Angeles, San Jose
A McDonald's franchisee who's raised prices because of California's $20 minimum wage is worried about scaring off diners. "I can't charge $20 for a Happy Meal," the franchisee told CNN. California put its minimum wage for fast-food workers up to $20 an hour on Monday, a 25% increase on the state's general minimum wage. Related storiesThe state's fast food council can raise the minimum wage by up to 3.5% yearly, depending on inflation. Are you a fast-food worker excited about the new minimum wage?
Persons: who's, , Scott Rodrick, Rodrick, I've, Angelica Hernandez, Hernandez Organizations: CNN, Service, Los Angeles County, KTLA, Fox News, Fast Food Council Locations: California, Sacramento, Los Angeles
CNN —As of Monday, about half a million fast food workers in California are making at least $20 per hour, $4 higher than the overall state minimum wage. This council can also recommend standards for fast-food worker safety and work with existing state agencies to investigate issues like wage theft. Mendelsohn, who owns six El Pollo Loco locations, has long championed workers’ rights, including helping trans workers connect with jobs. “I just wish it was being done over a longer period of time and it wasn’t just fast food,” Mendelsohn said. Additionally, they hope the council can discus fair working conditions, including wage theft, excessive heat and violence at work.
Persons: , , Jaylene Loubet, We’re, Michaela Mendelsohn, Scott Rodrick, Rodrick, ” Rodrick, it’s, I’ve, Mendelsohn, you’re, ” Mendelsohn, Loubet, ” Loubet, isn’t Organizations: CNN, El, Workers, Locations: California, San Francisco Bay, , Los Angeles
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailMcDonald’s CA franchisee on new minimum wage: The sheer scale of the impact is just breathtakingScott Rodrick, McDonald’s California franchisee, joins 'Squawk Box' to discuss news of the new fast-food minimum wage hike in California, the impact on franchise operators in the state, and more.
Persons: Scott Rodrick Organizations: McDonald’s Locations: California
Californian fast-food restaurants are cutting workers to prepare for the $20 minimum wage. AdvertisementFast-food restaurants in California are laying off hundreds of workers to cut back on costs as they prepare for the state's $20 minimum wage for fast-food workers that comes into force in April, a new report by The Wall Street Journal details. Franchisees are worried about higher prices spooking dinersCalifornia is raising the state's minimum wage for workers at limited-service restaurants to $20 an hour from April 1 — 25% higher than its general minimum wage. AdvertisementThe franchisees generally set prices, and some are concerned that higher prices could scare off diners. "I can't charge $20 for Happy Meals," Scott Rodrick, owner of 18 McDonald's restaurants in Northern California, told the Journal.
Persons: , Alexander Johnson, Anne's, Scott Rodrick, Brian Hom, He's, Hom, Roy Gilad Organizations: Pizza, Service, Wall, Southern California Pizza Company, Business, KTLA Locations: California, Southern, West, Northern California, Los Angeles, San Jose
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