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In the Media

article imageDenny's to Metz on Obamacare surcharge: 'Do not pass go'

By Can Tran
Nov 21, 2012 in Food
John Metz, who owns over 30 Denny's franchises, talked about adding an "Obamacare surcharge" to customers' bills; but, that plan was shot down by Denny's CEO John Miller.
Barack Obama, the Democratic incumbent, won re-election as United States President. However, there are businesses that threatened to layoff employees if or do something else if Obama got re-elected. John Schnatter, who the CEO of the Papa John's pizza chain, said that the Affordable Healthcare Act nicknamed “Obamacare” would force costs to be raised from eleven cents to fourteen cents a pizza. John Metz, whose company called RREMC Restaurants which owns , said he was planning to add a five percent surcharge to the customers' checks. Metz was talking about how he would have to pass the cost to the consumers because of Obamacare.
According to a recent article on Slate which was republished on the Huffington Post, don't take Metz or Schnatter's plans seriously. It points out that there are other factors that affect costs. The article says that costs fluctuate such as ingredient costs, rent costs, etc. Furthermore, it said that any food chain is used to coping with cost fluctuations. It also points out that compensation is driven by productivity and not by politicians.
However, Metz's remarks have caught attention of John Miller who is the CEO of Denny's. Miller spoke differently on Obamacare. In fact, Miller responded to Metz's remark on an “Obamacare” surcharge. In response, Miller shot down Metz's talks about it. When talking to the Huffington Post, Miller said that while Metz has the right to speak on those issues, there do represent the company's position. In this respect, Miller said that Metz does not speak for Denny's. Keep in mind that the franchises are individually owned.
Metz then apologized for talking about the “Obamacare surcharge.”
While Miller said that Metz's words didn't mean it was the company's position, the business itself. Metz's words had an adverse effect on Denny's as a whole. In the article, it mentioned Abdo Mouannes who owns several Denny's restaurants. Sales had dropped immediately after Metz's comments were known. Mouannes had to deal with angry callers. He even expressed opposition for Metz's idea of a surcharge.
The article points out Mouannes' plight as the franchises are individually owned. Furthermore, it talked about the franchises expand by selling operating and branding rights to independent business owners. If you own a franchise, you have to go with the system that's in place.
In short, Metz who owns franchises talked about the “Obamacare surcharge.” In response, the Denny's CEO promptly shoots Metz's words down. Unfortunately, other Denny's franchises (especially those that oppose Metz's idea) suffered a drop in sales. Ultimately, the CEO's words are similar to this Monopoly phrase: “Do not pass Go, do not collect $500.”
article:337364:4::0
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