Minimum Wage Increase

Minimum Wage Increase
By Dwayne Reno

Minimum Wage Increase, We knew it was gonna happen. The amount varies by Province. But in Ontario, it will be increased to $10.30 for students under 18, and $11.25 for adults as of October 1st, 2015. Since legislation has tied the minimum wage to inflation, you can expect this amount to only go up. For more details checkout the Service Canada website.

What does this mean for the food services industry?
Inflation & the minimum wage are one....

Food service operators are already seeing profits shrink due to menu inflation at 2.7%. Also many operators are already paying 40% on labour costs, a hike in the minimum wage could be the blow that some small operators might not be able to endure over long periods. Here are some suggestions to keep in mind.

• Shift Management
  Properly manage your employee’s shifts. Your busiest hours should have the most shift hours being worked. Whereas your slowest hours should have the least shift hours worked.


• Food Cost Management
  Reduce your food costs. If you have not looked into reducing your food costs, maybe this is the right time to do so. Better food costs means operators can charge competitive prices to their customers, and put more profit into their pocket and business.

Lastly you could raise menu prices and tell customers they don't have to tip. But even if the higher prices doesn't have your customers running to your competitors just picture the impact on your hiring and retaining of staff, who are used to working with tip and salary?

Going Forward
All restaurant operators should be thinking about the things you can positively change, such as your goods (food) and ambiance (service) to help increase up-selling, frequency of visits and new trials. I'm not against the increase and agree that everyone deserves a livable wage. But the government should be mindful of how this will impact unemployment rates and small businesses. Until next time, continue to give them the goods!

Need inspiration? Checkout some of our services.