Get ahead of the game
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What to do? Some suggest operators getting ahead of the game.
“In the end, the full impact to small business owners remains to be seen within the constraints of our new regulatory environment," says Michael Alter, president of SurePayroll. “However, similar to other challenges, it’s all in how you prepare.”
His company recommends the following six steps to prepare for the potential negative impact of a minimum wage increase:
1. Understand profit margins, projections and business requirements to ensure profitability.
2. Determine permanent hiring vs. contracting decisions for staffing needs.
3. Make good hiring decisions—mistakes can be costly since training/onboarding new employees is a considerable investment.
4. Invest in employees—turnover decreases productivity and increases business costs.
5. Be sure to employ time and cost saving tools to standardize back office tasks. Consider outsourcing to easy affordable services that allow you to focus on growing business, not administrative functions.
6. Research competition and adjust pricing accordingly.
Another way to get ahead of the minimum wage curve: go ahead and raise wages to what they’re likely going to be anyway. That’s the move that got Punch Pizza founder and co-owner John Soranno a shout-out from President Obama during the State of the Union address. The lowest wage at Soranno’s eight-store Minnesota pizza chain is now $10 per hour.
Sorrano’s now pays some of his 300 employees a bit more than the law currently requires, but he’s reaping a public relations bonanza. Let’s hope some of those people telling the survey-takers that a higher minimum wage is a good idea put their money where their mouths are and buy their next pizza from places like Sorrano’s Punch Pizza chain.
For those operators wondering where the minimum wage law came from in the first place, check out this link.