Chain Leader

Lane Cardwell

Are You a Freeloader?
March 26, 2008

First, let's make sure we are speaking the same language. Merriam-Webster defines a freeloader as someone who imposes upon another's generosity or hospitality without sharing in the cost or responsibility involved. A synonym offered is "sponge". I'm sure we are speaking the same language now. To be labeled a freeloader in the hospitality industry is a serious charge indeed. Let's see if it applies to you.

But first, let's look at a possible future for our industry in a series of situations that others would wish upon us: 

• Forget minimum wage. We are now paying a living wage to all of our employees. This wage would differ around the country but is in the $11-$14/hour range and will increase with inflation. It doesn't matter if any of our employees receive tips.
• This isn't really a problem since most employees have been unionized, and why have a union unless they can deliver higher wages than the required minimums?
• Health care is mandated for employees who work over 20 hours per week. The policy costs about $4,000 per employee. Coincidentally, that is approximately the amount that each employee in our industry generates in profits. Our pointing that out didn't seem to matter.
• All animal proteins sold within our restaurants (beef, chicken, pork, etc.) must be certified to have been raised in a humane manner before we kill them to be eaten (a delicious irony). 
• Portion sizes are now legislated. You will be taxed on menu items that exceed the legislated weights (small, of course). Legislation is pending that will impose fines on exceeding these weights. Naturally, the attorneys will be looking carefully at our ability to stay within these levels. It could be a liability to have people actually interacting with the food since variances could generate class action lawsuits. 
• Nutritional levels on calories, fat grams and sodium must be adhered to. Same penalties and legal exposures as on portion sizes. 
• Most customers in full service restaurants are no longer drinking alcohol in our facilities. The risks are just too great. The BAC legal level for drunk driving is now .05%, down from .08% (which is down from the decades old standard of .10%). .05% means a woman could have just over a glass of wine with dinner and still drive (maybe). 
• Those who are brave enough to drink still must contend with getting past the ignition interlock systems that have been required on all cars. The levels have been set below the .05% legal level since you wouldn't want someone who was almost "drunk" behind the wheel. The steering wheel will detect your BAC level and the car won't start if you have had a drink. 

Had enough? There is a lot more, but I believe you get the idea. It could be an ugly future. The fact that it is not already here is due in large part to Rick Berman at Berman and Company, and the companies that have funded his efforts to fight back this insanity. Rick operates four organizations that are the bedrock of our industry's counterattack: American Beverage Institute, Center for Consumer Freedom (I am a board member of this group), Center for Union Facts, and the Employment Policies Institute. Click on this link to see Rick defend our industry on 60 Minutes.

Where does the freeloader part come in?  If you are not supporting one or all of these groups, based upon where you feel your risks are, you are letting others do the heavy lifting. It is easy to think that the Brinker's, the Outback's, the Darden's and the Wendy's of the world will take care of it. They will continue to do their part, but they are not a big enough part of our industry to get the job done by themselves. They keep wondering when reinforcements will arrive. 

You pay for insurance to protect yourself against unexpected losses. Why would you not pay Berman to protect yourself against expected losses from all of these activities that could wipe out your bottom line? At some point in every group meal, each person must pay their share. Don't be a freeloader.

Posted by Lane Cardwell on March 26, 2008 | Comments (5)