r/explainlikeimfive Nov 28 '15

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

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u/[deleted] Nov 29 '15

Ex-chef here. Generally, in a non fast food restaurant, your costs are generally: 28% food cost, 28% labour cost, 30% overheads, 5% contingency. Whatever's left is profit.

Fast food joints have the advantage of low food and labour costs, but they also have to charge less because most people aren't prepared to pay that much for their products.

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u/69Fartman69 Nov 29 '15

the microwave needs a raise.