McDonald's franchisee group says new $20 minimum wage California fast-food bill will cause 'devastating financial blow'

I think people know? A franchise brings in x million per year, from the gross x percent goes to head office, remainder is used for operating costs and the balance is whats left for the franchisee. What you seem to be ignoring is that a shift in one cost doesnt mean everything else remains static. McDs head office wont enforce x percent of gross in a high labour market if it forces the franchise to close down.

Analysts create forecasts on the sustainable extraction of wealth from the community. By way of example. If there is a change in law meaning labour is now paid $4/h the franchisee wont jusy make 300k insteaf of 150k per year. The monthly fees will also go up, and the franchisee may make 200k a year now, with an additional 100k going to head office.

Prices also dont double with doubling of labour costs, the entire system is dynamic, with a readjustment of how much value each stakeholder takes from the overall pie.

I dont know if people act purposefully dense when these things come up or actually cant see beyond their immediate situation, but you dont get "double prices, all businesses close down, the economy will collapse" when you force a slight shift of the value pie towards labour that creates the value.

Sorry if the franchisee will now only get $100k per year in the bank per franchise managed by their team, instead of $150k, and head office can only capture 3.5% of gross instead of 4.5%, its totally worth it if hundreds and thousands of employees are not staying up at night worrying about paying for their gas, electricity, prescriptions or clothes for their kids.