Tuesday, December 31, 2013

Fast Food CEO: Gov't Regulation Is Driving Us Abroad, Killing US Jobs

I found this interesting as a reflection of how business in general has been affected by Big Government. In response to increased government regulation, major fast food companies are expanding rapidly - overseas.

In China, customers don't order french fries—they're shu tiao. In Turkey, they're called patates and in Russia, you would ask for kartofel' Fri.

Andy Puzder, the CEO of CKE Restaurants, the parent company of Hardee's and Carl's Jr., should know. His company is expanding rapidly abroad due to higher potential outside the U.S., which is hampered by what he sees as too much government regulation.

"It's difficult to open in the U.S., but we love the U.S. and continue to fight the good fight to open restaurants and create jobs," Puzder said. "It's just that the government is making it hard for us to build those restaurants."

Over the last three years, Hardee's and Carl's Jr. opened more restaurants internationally than in their own backyards—a first, he added. CKE now operates restaurants in 30 foreign countries.{..}

"Under the current U.S. business climate, regulatory and tax restrictions tend to curb otherwise dynamic entrepreneurial energy," Puzder said. "We'd love to see more growth in domestic markets. Unfortunately, it's easier for our franchisees to open a restaurant in Siberia than in California."

So aside from bureaucratic red tape, large fees and massive building and environmental regulations, what is stopping companies like CKE from opening more of their restaurants in America?

Puzder names ethanol regulation, which has resulted in higher beef costs, a rising minimum wage and higher labor costs because of Obamacare.

CKE's solution is simply to open less restaurants in America, and to turn increasingly to automation to eliminate as many positions as possible, with things like tablet ordering..and eventually, robot preparation as those costs come down compared to live employees.

"I think it satisfies the needs of younger people. It also reduces your costs," [Puzder] said. "When they talk about raising the minimum wage or providing health care for employees over 30 hours, you're really encouraging automation."

I would imagine that other food companies are doing the same thing.And something else to consider..opening up a small hamburger joint or other fast food restaurant used to be a very basic form of entrepreneurship available to many Americans, as well as providing summer and entry level jobs for a lot of people. If large corporations like CKE aren't opening up these establishments here, it means that a lot of individuals without the resources of CKE won't even try to open their doors.

I'm a non-consumer of fast food, but this strikes me as just one more instance of Big Government killing American entrepreneurship by making it as difficult as possible for the average American to open a business of their own.

That is not a good trend.

1 comment:

louielouie said...

as well as providing summer and entry level jobs for a lot of people.

that is part of the change that hussein is bringing to the US.
there are no more summer or entry level jobs. the people in the workforce today are career mickey dee and/or walmart employees. they are not capable of, and do not have the opportunity to, advance/improve. they just want to be paid more.
like anon always asks, "would you like fries with that?"