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"It's just a fact of doing business. Revenue - expense = profit
If your revenue goes down but your expense goes up..then something has to give."
Sometimes what has to 'give' is profit. My in-laws own a successful small business (residential and small commercial glazing). They pay their employees a living wage according to the community's economic standard, which is three times minimum wage. They pay 100% of their employees health benefits and the only health plan reductions are those that the insurer implements. They also have a retirement plan for each employee (some kind of IRA).
They've been affected by the economic downturn (who hasn't), but they have absorbed the loss. They simply have reduced their draw from their business.
Just like owning a home, there are minimum costs associated with owning a business. If you own a business, you need to have reserves/capital to cover overhead and expenses (including payroll), and unanticipated expenses. Those who are don't have the appropriate cash flow, probably should rethink they're business ownership.
Minimum wage is not a living wage. Anyone who wants to pay employees less than minimum, simply wants to shift the financial burden to the government as the lowly-paid employee(s) would qualify for a wide variety of federal and state aid/public assistance. If you pay your employees so little that they qualify for food stamps, you probably shouldn't be in business.
You seem to be making alot of presumptions here about small business. Do you deal with alot of small businesses on a regular basis ?If so then you'd realize you DO come to know the owners/employees on a more personal basis then let's say the cashier at Wallymart.
Small business folks give their customers something the Wallymarts and Targets of the world can NEVER give.
[quote=Beullah;11123685]"It's just a fact of doing business. Revenue - expense = profit
If your revenue goes down but your expense goes up..then something has to give."
Sometimes what has to 'give' is profit. My in-laws own a successful small business (residential and small commercial glazing). They pay their employees a living wage according to the community's economic standard, which is three times minimum wage. They pay 100% of their employees health benefits and the only health plan reductions are those that the insurer implements. They also have a retirement plan for each employee (some kind of IRA).
That is pretty awesome. Where are they located and are they hiring?
California, and, no, they're not hiring. They don't really need additional staff in this economic environment. Their business grosses between $1.7M and $2M per year, but it's a high-overhead business. Vehicles, equipment, BIG workers comp bills.
All of their employees are not stellar, but my FIL simply manages them by recognizing their strengths and weaknesses and assigns work accordingly. They've got the 'in-shop' guy, the 'shower-door' guy, and the slow, but meticulous guy (who pleases meticulous customers). They also keep their employees for years. What business owner needs to have constant turnover?
IMHO, they're fair and honest to their employees and creditors, and I believe that this their foundation for success. Kind of like Karma. Because they've been good, responsible business owners, they've reaped rewards in return.
California, and, no, they're not hiring. They don't really need additional staff in this economic environment. Their business grosses between $1.7M and $2M per year, but it's a high-overhead business. Vehicles, equipment, BIG workers comp bills.
All of their employees are not stellar, but my FIL simply manages them by recognizing their strengths and weaknesses and assigns work accordingly. They've got the 'in-shop' guy, the 'shower-door' guy, and the slow, but meticulous guy (who pleases meticulous customers). They also keep their employees for years. What business owner needs to have constant turnover?
IMHO, they're fair and honest to their employees and creditors, and I believe that this their foundation for success. Kind of like Karma. Because they've been good, responsible business owners, they've reaped rewards in return.
"It's just a fact of doing business. Revenue - expense = profit
If your revenue goes down but your expense goes up..then something has to give."
Sometimes what has to 'give' is profit. My in-laws own a successful small business (residential and small commercial glazing). They pay their employees a living wage according to the community's economic standard, which is three times minimum wage. They pay 100% of their employees health benefits and the only health plan reductions are those that the insurer implements. They also have a retirement plan for each employee (some kind of IRA).
They've been affected by the economic downturn (who hasn't), but they have absorbed the loss. They simply have reduced their draw from their business.
Just like owning a home, there are minimum costs associated with owning a business. If you own a business, you need to have reserves/capital to cover overhead and expenses (including payroll), and unanticipated expenses. Those who are don't have the appropriate cash flow, probably should rethink they're business ownership.
Minimum wage is not a living wage. Anyone who wants to pay employees less than minimum, simply wants to shift the financial burden to the government as the lowly-paid employee(s) would qualify for a wide variety of federal and state aid/public assistance. If you pay your employees so little that they qualify for food stamps, you probably shouldn't be in business.
+1 for you, and I have utmost respect for your inlaws. Most small business owners would not sacrifice their own bottom line like that to provide for their employees.
MY opinion: Yes the minimum wage makes it harder for a small business owner to hire more people. That seems like a no-brainer. The minimum wage also encourages illegal aliens. It was wrong when it was passed and is an attempt to manipulate the free market system. It increases inflation too.
I have the utmost respect for them, too. Not only professionally, but personally. They've been wonderful to my two children from my previous marriage and wonderful to me.
It's taken them over 40 years to build it. My FIL started working out of his garage in the 60s. Then he leased a location. He moved to another leased location and purchased the property when it came up for sale in the 70s. He's pretty shrewd, which helps him a lot. He bought his commercial property even when it was cheaper to lease. Now he has very little competition because leasing adds so much to a businesses' overhead.
Part of owning a business is just being really good at it. And, I think that many business owners aren't satisfied with just earning 'a living.' My in-laws just 'earned a living' for decades. It's only been in the last 20 years they've seen a marked increase in profits.
"MY opinion: Yes the minimum wage makes it harder for a small business owner to hire more people. That seems like a no-brainer. The minimum wage also encourages illegal aliens. It was wrong when it was passed and is an attempt to manipulate the free market system. It increases inflation too."
We have minimum wage laws for the same reasons we have child-labor laws, overtime laws, and other labor laws (such as meal periods). No worker protections = worker exploitation.
Undocumented immigrant employment is based on demand. Where I live, you have to verify your right to work as a citizen or legal resident. If you want to reduce the hiring of undocumented immigrants, press the employers. They're the ones in the power position.
Are increased wages passed on to consumers? Sometimes/often as all business-related costs are. If you're a homebuilder and the price of wood increases, you don't say that the wood producers are manipulating the market. If dairy prices increase, you pay more for milk at the grocery store. It's a part of doing business.
Poverty really isn't beneficial and not something we should encourage.
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