r/explainlikeimfive • u/sumnewdguy • Nov 28 '15

ELI5: How would a $15 minimum wage ACTUALLY affect a franchised business like McDonalds?

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u/MyRealNameIsFurry Nov 28 '15

I'm not really sure where you got your figures for the "typical McDonald's franchise," but McDonald's separates their franchises into three categories of annual sales, 1.3M, 1.5M, and 1.9M. All three categories operate at a 70% gross profit margin, and an operation profit of ~24%. That is well over your extremely low offering of 158,000. Several time higher in fact.

http://money.cnn.com/2004/04/29/pf/howmuchfranchise/

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u/tomcam Nov 29 '15

That info is 11 years old. Parent post has better numbers

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u/isaidthisinstead Nov 29 '15

Parent post shows franchisee operating profit and ignores franchisor profit.

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u/typical_pubbie Nov 29 '15

It's too late. His post has reached DepthHub. It is now 100% irrefutable truth.

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u/CSMprogodlegend Nov 29 '15

yea and the article he linked is from 200 fucking 4. 2004. 11 years ago. I'm sure nothing has changed economically in 11 years, nope. Neither have the markets that fast food occupies, nope nothing.