These are businesses that operate on single digit profit margins. And are easily replaced by eating meals at home. They either find a way to procure cheap labor, or shut down, because Applebees clientele do not really have the will or ability to spend more at Applebees.
Wahhhh. I heard this crap from my owner/operator every time the minimum wage went up. We'd be told to cut staff hours because it would hurt the bottom line. He made roughly 10% profit after controllable. 10%. Sounds horrible. However his gross sales at our best store were over $3M/year in the 80's. So PAC was $300K. Waaaahhhh.
He also owned four other McD's (though none as profitable as this one), so he was able to amortize all his corporate costs across five stores. He pulled in over $600K/year back in the 80's, yet was a Scrooge when it came to treating his employees. Cry me a river about "single digit profit margins." Tons of businesses have small margins, but make it up in volume.
