Health care views cause clash between restaurant companies, franchisees

Changing the message

(Continued from page 1)

Franchisors and franchisees should be concerned about the effect that their reactions to the health care act have on current employees, said Matthew Mabel, president of Surrender Inc., a Dallas-based hospitality and management consulting firm.

“Hospitality and anger do not coexist in the same space,” Mabel said. “No restaurant company can survive without good will from their employees and guests. Operators who voice their frustration risk alienating the people who make their businesses succeed every day on every shift.  Why would you want to start your day by aggravating the 50 percent of your guests who voted for Obama?”

Mabel added that even U.S. House Speaker John Boehner, after the general election, said that “Obamacare is the law of the land.”

Roz Mallet, the chairman of the National Restaurant Association who spoke at the recent People Report Best Practices Conference in Richardson, Texas, said that the restaurant industry had to stop being the “industry of no.”

“We’ve been hoping for the years that health care would go away,” she said. “Well, not gonna happen.”

O’Cull of KeyBanc said some restaurant brands, especially those in the fast-casual segment, are better situated to deal with the costs associated with the health-care laws.

“These chains typically require less labor hours for the amount of sales produced and are able to raise menu prices,” O’Cull said, adding that he’s more cautious of brands in family dining, pizza, labor-intensive fine-dining restaurants and company-owned chains that will need to increase administrative support to meet the act’s requirements.

Mabel said that even if burdened with higher costs, restaurants can communicate an affirmative message — that they're ensuring their associates have access to health care. "It is time to get out of victim mode and focus on making the best of a difficult situation," he said. "When [restaurants] eventually pass along the cost of Obamacare their guests will feel a lot better about contributing to restaurant workers’ health care, than to joining a protest movement, paying a tax or an ‘Obamacare Surcharge.’”

Mabel said he even sees a silver lining. “Once there is near-universal health care,” he said, “many of the best independent operators in our industry will not lose out on the chance to employ some great people who have had to seek jobs elsewhere in pursuit of any or better health care coverage. Restaurateurs would be wise to talk about that.”

Sarah Lockyer contributed to this story.

Contact Ron Ruggless at ronald.ruggless@penton.com
Follow him on Twitter: @RonRuggless