What will happen to fast food restaurants now?

Question

Eggs went up 35% recently, and labor costs will go up soon when the minimum wage increases. With food costs and labor costs on the rise, what can fast food restaurants do to maintain profit? If they raise pricies, more customers will eat at home. But if restaurants close then banks will have to eat the mortgages. So what will restaurants do? Please dont say "they are a multibullion dollar company they will be fine" we all know that statment isnt true.

Answer 1

There was an article in todays Wall Street Journal discussing restaurants and the current economy:

http://online.wsj.com/article/SB12090016...

It's pretty scary out there

Answer 2

In Iowa the minimum wage increased by $2.10 this past year.  Yes, our labor did go up and food prices have also gone up.  We raised prices a little bit to offset this.  Over the last year sales have continued to increase, so far everything is going fine.  Right now Subway is running the $5 footlong promotion.  Sales are up at about 30%.  I think you will see advertising campaigns like that for a lot of other places.  Costs go up, but when sales go up that high it helps defray a lot of those costs.

Answer 3

dont worry