Recently, the minimum wage for fast food workers in California increased to $20. It’s easy to react to this number with disbelief. It’s not far from the upcoming minimum wage of $17.27 for all Los Angeles businesses in July. Labor and food costs are central expenses in running a restaurant, and they’re the only things you can truly control. But what do you do when both of these costs feel out of control? You consider leaving California. I’m not leaving, but a lot of people have.
I know some of you may be thinking that’s extreme. However, when I started my first pizza job in Los Angeles back in 2008, the minimum wage was $8. With such a substantial increase in wages like we’ve seen in California since then, you might expect everyone to be living comfortably. But the reality is, it still doesn’t seem to be enough to make ends meet here in Los Angeles. Rent prices are insane, grocery prices are increasing, and gas prices are astronomical.
I’ve previously discussed why I charge $35 for my pizzas. At this point, that should be the industry standard out here. While the minimum wage is rising, so is everything else. That’s the issue with these changes: While the number keeps going higher, so does everything else, so it feels like nothing is really changing.
Related: Alex Koons: Making the tough decisions for your pizzeria
It’s incredibly challenging to navigate the increase in costs while ensuring that your pricing remains palatable to customers. My strategy is to focus on delivering the best possible product and creating a welcoming atmosphere that fosters an awesome work environment. This way, I can justify my prices and feel confident in compensating a team that works tirelessly to craft a pizza worth every penny.
Some pizzeria operators are also investing in tools such as a pizza press, dough separator and roller, which can contribute to cost savings. Additionally, the use of payment kiosks is becoming increasingly common in Los Angeles. While I personally see that as detrimental to the essence of a restaurant, it certainly offers a means to reduce costs and streamline operations in the service industry.
Running a restaurant often feels like playing a pinball game—you’re constantly being bounced around by flippers, trying to score points while navigating the chaos. It’s all about doing your best with whatever obstacles come your way. As for whether these price changes are ultimately beneficial for the economy in California, I can’t say. All I can do is tackle each new challenge within the pinball machine to the best of my ability—like the proverbial pinball wizard—so I don’t end up in a gobble hole.
Alex Koons is a pizza industry consultant and the owner of Hot Tongue Pizza and co-owner of Purgatory Pizza, both in Los Angeles. He is also the host of the Pie 2 Pie podcast.