Pizza Hut made over $6 billion last year, you’d think they could afford to pay their drivers.
Of course the can pay their drivers but think of the poor shareholders who may see 0.1% less profit or the CEO who may get only 99% of their usual bonus. Oh the horror!!
The Pizza Hut corporation will be fine. These are franchises we are talking about. The franchises pay an initial fee of $25k and then 6% + 4.75% sales/marketing fees to Pizza Hut.
It’s the owners of the franchises that are responsible for fucking over their employees. While Pizza Hut could reduce their fees, they won’t. Franchise owners could increase pay, but they won’t. It’s more likely that the franchise owners will offload deliveries to Uber and Door Dash and not have to worry about managing drivers anymore.
The entire model sucks, so I am not blaming franchise owners over the corporation. They are both at fault for relying on the extortion of teenagers or other people who don’t have extremely profitable job skills.
https://franchise.pizzahut.com/faqs/
Edit: Also, these aren’t one-off mom and pop franchise owners anymore. These are franchise owning conglomerates that likely have more negotiable franchise fees.
Won’t offloading the delivery to those services cost even more? They take a pretty hefty cut of the sale. Last I heard it was around 30% of an order.
There’s 19,000 pizza huts, but most all of them are franchises. It’s not “pizza hut” firing drivers over this. It’s franchise owners. Also, if you were to do some napkin math, 19,000 (I know. Just california, but that would hardly be fair to everyone else) pizza huts needing say…5 drivers each at 40 hours a week paid 20 means a cost of about 28 after insurance and such… that’d be 95 thousand drivers…$106,400,000 a week…$5,532,800,000 a year.
Shit gets expensive.
But face it. Delivery drivers make a lot in tips. People have been willing to do it using their own vehicles for decades while they make super low minimum wages. Making $20/ hour plus the tips will have the delivery guy out doing everyone else at the restaurant, which means their pay will have to go to like $35/hour which means a stupid pizza is gonna cost $30. Let uber eats handle the deliveries.
Pizza in Boston delivered by door dash is routinely right about $30 before tip. My credit card offers free door dash premium whatever it’s called and I usually choose places offering a promo and tend to order early when there are also promos. That brings things down to the $20s. But it’s generally about $30 with tip even doing all that. If I’m not paying attention it’s easy to order a $45 pizza.
To be fair I don’t eat from pizza Hut or Dominos or other chains. Those might be a few percent cheaper.
That’s half my point, though. You choosing to pay $30 through door dash or Uber eats is your choice. The restaurant isn’t charging way more for their pizzas because they have to pay everyone on staff a lot more. Delivery has been outsourced and so have the added costs that go along with it.
What pizza hut has 5 full time drivers? There’s only 1200 people affected by this and 560 locations so a little more than 2 per location. Now let’s look at the cost those delivery apps charge 30%. So if 35% of sales are deliveries now theyre paying Uber ~110k to deliver their pizzas. 28$/hr is high closer to 23-25$/hr for overhead. That’s roughly what the delivery drivers would have cost and now they’re getting way shittier delivery service and people are much less likely to buy pizza from them. Sounds like a dumb move.
5 too many? I just figured there’d be like 2 delivery people at any given time and trying to have 3 on Friday and Saturday night.
But as to Uber, that’s the customers choice if they want to pay an arm and a leg to have pizza brought to their door. It won’t much effect the pizza hut. Store dedicated delivery drivers are a thing of the past now. They’ve been outsourced.
$20/hour is only part of employee compensation. It does not include benefits or taxes. Your employer pays a lot of taxes on your behalf.
Don’t even get me started on the money and time taken to recruit, hire, and train new employees.
Don’t misunderstand me. I support a higher minimum wage. I am a firm believer that minimum wage should be $25/hour and increases should be tied to inflation.
Don’t even get me started on the money and time taken to recruit, hire, and train new employees.
For delivery drivers?
Know how to drive? If not, next. Here’s the pizza. Put it on a flat surface in the vehicle, don’t throw or flip it. Use Google maps to get to the house. Hand it to the customer. Come back. Done.
It’s staggering how many people don’t understand the difference between franchises and corporations on wall street in the internet age
It’s staggering how many people assume things without looking into them. In this case, it’s a corporation called Pac Pizza, LLC and makes over $25 million per year that’s doing the layoffs. I think they can pay their delivery drivers an extra $4 (according to the USA Today article linked above) per hour.
If they had to pay all of their less than 500 employees (according to the Zoominfo page linked above) the extra $4 per hour, and they all worked full time, 40-hour weeks all year, the company would have to pay just over $4 million in extra wages.
Assuming the franchises make the low end of the estimated revenue linked above, $4.5 million would be 16% of the total. Increasing prices by 16% to cover that cost is far less than the approximately 40% customers end up paying when using third-party delivery services.
All in all, this sure seems like the franchise corporation (probably in cahoots with Pizza Hut proper) is just using these delivery jobs as a political stunt in opposition of the mandated wage increase.
Here’s the takeaway, though. Any employer, including but not limited to mom-and-pop businesses, that can’t afford to pay its employees a living wage should not be in business.
It’s staggering how many people assume things without looking into them. In this case, it’s a corporation called Pac Pizza, LLC and makes over $25 million per year that’s doing the layoffs. I think they can pay their delivery drivers an extra $4 (according to the USA Today article linked above) per hour.
If they had to pay all of their less than 500 employees (according to the Zoominfo page linked above) the extra $4 per hour, and they all worked full time, 40-hour weeks all year, the company would have to pay just over $4 million in extra wages.
Assuming the franchises make the low end of the estimated revenue linked above, $4.5 million would be 16% of the total. Increasing prices by 16% to cover that cost is far less than the approximately 40% customers end up paying when using third-party delivery services.
All in all, this sure seems like the franchise corporation (probably in cahoots with Pizza Hut proper) is just using these delivery jobs as a political stunt in opposition of the mandated wage increase.
Here’s the takeaway, though. Any employer, including but not limited to mom-and-pop businesses, that can’t afford to pay its employees a living wage should not be in business.
How much business do they expect to get as a pizza delivery company without delivery drivers? I’ll bet this goes really poorly, the franchise shuts down, and then the owner goes on Fox News talking about how “the new wages in Commiefornia forced me out of business!”
When has anyone ever driven to a pizza hut? I remember do so as a child but now pizza hut seems like a definite delivery thing.
I’ve literally never gotten Pizza Hut delivered. Maybe it’s a Europe vs US thing but to me it’s a sit-down restaurant.
It’s s different experience. One day colleagues decided to order Pizza Hut. It was raining she’s they didn’t want to go out. I opted to get a pizza at a restaurant instead.
I must admit here in Europe it’s not common to order Pizza Hut. And it seems in our local shop they aren’t used to doing it since I had the time to sit down and eat, walk back and my colleagues haven’t had their delivery arrive yet. Could have been just bad luck.
The one in your town doesn’t allow sit down since covid. Shame, the buffet was what I liked about it.
Must be a Europe vs us thing… Here it’s been mostly delivery for over a decade
I honestly thought they all closed down until my work ordered some like six months ago.
Until then I hadn’t seen a restaurant or heard of anyone getting it delivered.
I just sort of assumed they went out of business or something.
Edit: even the pizza box looked like something from the past.
In the early 80s Pizza Hut used to be sort of like a normal restaurant… they usually had standalone buildings (which now have mostly been turned into other restaurants) rather than spots in strip malls, with a seating area. You could order a pizza or sandwiches and eat with your family, and they had a salad bar back when salad bars were kind of a hot trend. This persisted into the 2000s especially in smaller areas.
They could have just focused on providing a better delivery experience, instead they’re going to let uber drivers deliver cold pizza with the wrong soda.
After winning on Prop 22, Uber/Lyft guaranteed drivers $13/hr. I’m not sure where the likes of Uber Eats/Grubhub stand in comparison, but even if we assume they’re also at $13/hr, that’s a full ‘federal minimum wage’ less than the Pizza Hut drivers would need to be paid. For doing literally the same job but with way, way worse benefits (e.g., having to provide your own insurance).
It’s actually insane. Prop 22 is a travesty.
$20/hr isn’t even what I would consider a living wage in California, and Pizza Hut is here proudly admitting they were paying their drivers substantially less than that. But the deliveries will still happen, just to even worse-paid people. It’s a crazy cycle of abuse of labor.
With higher delivery fees! Why on earth would anyone even order Pizza Hut after this? If I’m paying obscene delivery fees and jacked up menu prices through doordash or whoever anyway, I’m getting better food than that. Or just eating at home like I end up doing every time I look at the total from one of those services.
It doesn’t even make sense as sure, Uber doesn’t pay drivers much and Pizza Hut won’t have to employ them, but customers will have to pay more. So Pizza Hut could have just said “due to increases in wages we have to implement a delivery fee”, and actually paid their drivers. They’d rather do this dramatic ‘omg we have to fire them’ thing though.
Its a punitive measure. Our lords want to send the message that further wage legislation will not be tolerated.
You are vastly overestimating the brain dead American population that will see the higher price, order delivery anyway, and then stop thinking about it.
Like, they just don’t think about how it will affect their finances at all. People order takeout and delivery every day without a second thought.
To be clear I am not victim blaming the poor, but we are beyond late stage capitalism here. They won.
It has been getting worse.
Out of curiosity, did you send that message recently or a day or two ago? My inbox says it’s been like 20m. Looking at the thread it says 2 days.
Seriously. I don’t see why companies that were already paying for delivery drivers (eg, the chain pizza companies) don’t sell their delivery services as a value add. When I order a pizza from DoorDash, it doesn’t come wrapped in an insulated carrier and so often arrives cold. I’m not sure what else they could throw in but they’re just tossing it (no pun intended).
I’m also curious as to the numbers on this. I don’t know if this was done after a full evaluation of raising delivery service fees or other ways of addressing it, but the fact that they’re doing it in all of California instead of keeping it in markets like SF or LA makes me think it was a petulant act rather than a rationally justified one.
Just as a clarification (not a defense) from someone that drives for DoorDash - every time the driver picks up a pizza order, they are required to provide photo proof that they own a pizza bag. I’m not saying this forces drivers to use them, but they have to upload different pics of their pizza bags sometimes with every pickup.
Edit: autocorrect
The reason you have to do this is because you drivers are notorious for having absolutely zero standards and a solid “idgaf” attitude.
This is so weird to me because pizza is one of the few things I actually order for delivery… there isn’t much around here other than 3rd party services, which I don’t use because I’m rural and the way it works here is just gross. Had 6 come in for the same failed order while I was out on Tuesday (menu wasn’t open for that item but it was ordered through another platform, and 6 people came asking for it for the same order because of how the platform works). I can’t imagine actually working there.
But I suppose in more urban areas, pizza hut is competing with actually good food also on delivery (for a very steep markup people are apparently willing to pay or the services would die), so it’s no surprise they can’t compete on their own; and still also turn record profits. Heaven forbid they die in the region. 🙂
If it even comes at all. I had several just disappear driving all over town and never show. Last one I got a bag of soup. That’s the plastic bag, with spilled bowl of soup, leaking out of said bag. Never again
And they are going to charge for it. I hate pizza places that have done this. It’s at LEAST $20-$30 more now to get delivery.
Happy New Year, everyone!
