Mark Haney: Super excited about today's show.

Mark Haney: One reason is because we're gonna talk

Mark Haney: about something that might be considered by

Mark Haney: some people as a little bit controversial.

Mark Haney: I don't think it's all that controversial,

Mark Haney: but I think it might be to some.

Mark Haney: Today I have Eric Freeman in the house.

Mark Haney: He is the CEO of Jim Boy's North America.

Mark Haney: Welcome to the show.

Erik Freeman: Hey Mark, how you doing.

Mark Haney: Glad you are here Now, Jim Boy's North

Mark Haney: America.

Mark Haney: I mean, how big are you guys now?

Mark Haney: Hey guys, you're still a taco stand.

Erik Freeman: That's where my grandfather started.

Erik Freeman: I love it it was at a 1954, just one

Erik Freeman: trailer.

Erik Freeman: We have 40 locations now, mostly in the

Erik Freeman: Sacramento Northern California area, but we

Erik Freeman: also have some in Nevada and Texas.

Mark Haney: Well you guys, I'm gonna go out on a limb

Mark Haney: and say you guys do have the best tacos in

Mark Haney: North America.

Mark Haney: I was gonna say the secret sauce, but

Mark Haney: there's like little cheese or something

Mark Haney: that you put on the tacos.

Mark Haney: It makes it taste just a little bit of a

Mark Haney: bite to it Tastes good.

Erik Freeman: We like to say that we're the original

Erik Freeman: American taco and it's Parmesan cheese.

Erik Freeman: That's on the outside.

Mark Haney: That's, I think, with whatever buddy craves.

Mark Haney: And if you are a new listener, so this show

Mark Haney: is all about winning and you know Eric and

Mark Haney: his family have built a winning business, a

Mark Haney: highly successful I'll call it a fast food

Mark Haney: business, but it's really a great

Mark Haney: restaurant and it's started right here in

Mark Haney: the Sacramento area.

Mark Haney: But again, this show is about winning and

Mark Haney: we are building the backyard advantage the

Mark Haney: most connected community in the world for

Mark Haney: local entrepreneurs and it's centered

Mark Haney: around this culture of love, helping one

Mark Haney: another.

Mark Haney: So if that is something that you want to be

Mark Haney: a part of, for sure, come, get involved,

Mark Haney: feel free to subscribe, to share, to

Mark Haney: comment, but really, if you're one of these

Mark Haney: people that gets it, you understand the

Mark Haney: power of entrepreneurship.

Mark Haney: Come start to chime in and be a part of

Mark Haney: this.

Mark Haney: And, as I mentioned today, I mean winning

Mark Haney: is not really controversial, I think, but

Mark Haney: sometimes the handcuffs that the government

Mark Haney: applies to us and the regulations they can

Mark Haney: be a little bit controversial because

Mark Haney: obviously some people think that we should

Mark Haney: be regulated and I think many of us get on

Mark Haney: certain regulations we want to push back a

Mark Haney: little bit.

Mark Haney: Today we're going to be talking about

Mark Haney: minimum wage, where you know there's a

Mark Haney: there's a new wage increase that is being

Mark Haney: mandated, called AB 1228.

Mark Haney: Is that something that's affecting you?

Erik Freeman: It's honestly, Mark, it's going to affect

Erik Freeman: everybody and every industry.

Erik Freeman: So if there was a time to come and come

Erik Freeman: together as restaurant owners, as

Erik Freeman: entrepreneurs, it would be now.

Mark Haney: Okay, so tell us about this AB 1228.

Mark Haney: It's a minimum wage increase.

Mark Haney: Maybe just give us a little bit of the

Mark Haney: backdrop of what it is and why some people

Mark Haney: want it and then why it really is not good

Mark Haney: for their.

Mark Haney: You know, it's not really not good for

Mark Haney: America, Really not good for America.

Erik Freeman: Sure.

Erik Freeman: So for the last several years California

Erik Freeman: has been working on increasing minimum

Erik Freeman: wages.

Erik Freeman: We've had to do pretty significant

Erik Freeman: increases.

Erik Freeman: They've had a staggered approach this was

Erik Freeman: about three or four years ago to get to $15

Erik Freeman: minimum wage.

Mark Haney: What is it now?

Mark Haney: $15.

Erik Freeman: It's $1550 now.

Erik Freeman: Now the staggered approach was that they

Erik Freeman: were accelerating the wage increases every

Erik Freeman: year for larger employers in the restaurant

Erik Freeman: segment versus smaller employers, in order

Erik Freeman: to get everybody up to that level where

Erik Freeman: everybody's at $1550 now and actually just

Erik Freeman: coming up in January it's going to be $16

Erik Freeman: an hour.

Erik Freeman: The struggle has been that every, first of

Erik Freeman: all, restaurant owners don't like to

Erik Freeman: increase prices.

Erik Freeman: It's always something that gives them a lot

Erik Freeman: of heartburn.

Erik Freeman: They care about their customers.

Erik Freeman: They don't like losing customers.

Erik Freeman: I can say for gym boys you know, when we

Erik Freeman: look at the data, every time we do a price

Erik Freeman: increase, you know and over the last

Erik Freeman: several years we've had to do pretty

Erik Freeman: significant increases three, four, 5%, and

Erik Freeman: sometimes some restaurants have had to do

Erik Freeman: it twice a year you lose customers.

Erik Freeman: We've lost about three to four percent.

Erik Freeman: You know.

Erik Freeman: Every year that we do an increase, we lose

Erik Freeman: about three to four percent of customers.

Erik Freeman: So it's a legitimate worry.

Erik Freeman: It's a legitimate concern that restaurant

Erik Freeman: owners have Coming up.

Erik Freeman: This bill that we're talking about is a

Erik Freeman: minimum wage increase to $20 an hour.

Mark Haney: Jump from $1550 to $20?.

Erik Freeman: Well, starting January 1st of 2024, is

Erik Freeman: going to be $16 an hour, and then three

Erik Freeman: months later, in April, or four months

Erik Freeman: later in April, it's going to be $20 an

Erik Freeman: hour.

Erik Freeman: Now, this is for locations, this is for

Erik Freeman: brands that have stores nationwide of over

Erik Freeman: 60 locations, and it's focused on limited

Erik Freeman: service.

Erik Freeman: With that being said, though, don't think

Erik Freeman: that it won't affect you, you know, or

Erik Freeman: anyone, and every industry is going to be

Erik Freeman: touched by this.

Mark Haney: So is this geared toward restaurants or is

Mark Haney: it geared toward all retail with locations

Mark Haney: over 60?

Erik Freeman: So it's limited service, so it's really

Erik Freeman: geared towards fast food.

Erik Freeman: We actually don't have more than 60

Erik Freeman: locations, so we don't fall into that.

Erik Freeman: So, starting in April, just a little bit

Erik Freeman: more background on the detail here.

Erik Freeman: Starting April, it's going to increase to

Erik Freeman: $20 an hour.

Erik Freeman: It also comes with a like a council that's

Erik Freeman: been formed, and so there's going to be two

Erik Freeman: representatives who are worker.

Erik Freeman: They're they're restaurant workers.

Erik Freeman: They represent the restaurant workers.

Erik Freeman: There will be two people who are restaurant

Erik Freeman: owners.

Erik Freeman: There's going to be two people who

Erik Freeman: represent the the industry in general.

Erik Freeman: There's going to be two people who are

Erik Freeman: restaurant worker advocates, and then

Erik Freeman: there's going to be one person that is

Erik Freeman: unaffiliated with the industry at all.

Erik Freeman: The idea is for this council to come

Erik Freeman: together to discuss next steps.

Erik Freeman: They will, as of January 1st of 2025,

Erik Freeman: they'll have the authority and the ability

Erik Freeman: to unilaterally raise minimum wages after

Erik Freeman: that.

Mark Haney: So these seven people we're talking about

Mark Haney: seven people, is that what it is?

Mark Haney: And and they will control minimum wage for

Mark Haney: the fast food industry.

Erik Freeman: For California.

Erik Freeman: Yes, this is just a California rule.

Erik Freeman: This is just specific to California.

Mark Haney: But seven people get to run the show, and

Mark Haney: well, I mean, that's odd.

Erik Freeman: It's.

Erik Freeman: It has been and now this has been in the

Erik Freeman: works for a while.

Erik Freeman: It got slammed down about a year ago, but

Erik Freeman: it's really just been a push and pull

Erik Freeman: method for a tug of war really for about a

Erik Freeman: year.

Erik Freeman: This one came through and I think a lot of

Erik Freeman: restaurant owners were caught off guard

Erik Freeman: didn't necessarily, and you know it's been,

Erik Freeman: it's been busy, so not everybody were able

Erik Freeman: to get on board and speak their mind and be

Erik Freeman: able to stop this.

Erik Freeman: So it's in play now.

Mark Haney: Okay.

Mark Haney: So what's happening?

Mark Haney: There's no changing it.

Mark Haney: There's not really a.

Mark Haney: It's not in the process of being reversed,

Mark Haney: it's it's here Now, what are we going to do

Mark Haney: about it?

Erik Freeman: Correct, that's really what the

Erik Freeman: conversation is now.

Erik Freeman: Could people get together?

Erik Freeman: Sure, at this point, I think it's going to

Erik Freeman: be more productive to talk about how do you

Erik Freeman: address this, how do you get past this, how

Erik Freeman: do we come together and and and come up

Erik Freeman: with ways to to tackle this In January 2025,

Erik Freeman: from that point forward, the count, the

Erik Freeman: council, has the ability to raise prices

Erik Freeman: unilaterally.

Erik Freeman: They can pick which counties they'd like to

Erik Freeman: raise the minimum wage.

Erik Freeman: They cannot exceed 3.5%, so there is some

Erik Freeman: what of a ceiling there.

Erik Freeman: But I want to make sure that this is clear

Erik Freeman: A $20 minimum wage from where we are right

Erik Freeman: now is a 25% increase to labor costs, and

Erik Freeman: that's minimum.

Erik Freeman: So, even though they're going to limit this,

Erik Freeman: you know, in 2025, it doesn't really matter

Erik Freeman: that much because it's already gone up 25%.

Mark Haney: Right, you're talking about, yeah, 3%, 3.5%

Mark Haney: per year on the $20 an hour.

Mark Haney: Yeah, okay, so this is interesting.

Mark Haney: So I think my audience knows is we?

Mark Haney: We don't really do a political show here

Mark Haney: and I don't sit here and get on one side of

Mark Haney: regulation or the other, because a lot of

Mark Haney: different viewpoints and it's a lot easier

Mark Haney: to kind of answer the question what are you

Mark Haney: going to do about it?

Mark Haney: Right, what are you going to do with what

Mark Haney: you got?

Mark Haney: Now the government put it's another

Mark Haney: restriction on us or a regulation on us.

Mark Haney: It's already a lot of regulation we all

Mark Haney: have to, you know, work to our advantage or

Mark Haney: keep it from hurting us or whatever.

Mark Haney: But maybe we'll talk about the other side

Mark Haney: for a second before we talk about, like,

Mark Haney: how are we supposed to deal with it?

Mark Haney: Why would a lot of people think it's a good

Mark Haney: idea to raise let's put our hat on of the

Mark Haney: of the people that are advocates, have been

Mark Haney: advocates for this, because obviously

Mark Haney: they've had enough persuasion or persuasive

Mark Haney: powers to to get this across the finish

Mark Haney: line and make it and put it into law.

Mark Haney: Why, what's their argument that got us to

Mark Haney: want to raise it so fast?

Mark Haney: What's the other side?

Erik Freeman: Yeah, I'd say mostly it has to do with a

Erik Freeman: living wage.

Erik Freeman: So, you know, when it comes to families,

Erik Freeman: when it comes to, you know of hardworking

Erik Freeman: families that are solely working in the

Erik Freeman: restaurant industry or solely looking for a

Erik Freeman: restaurant and they have a family of two,

Erik Freeman: or themselves or a family, afford to feed.

Erik Freeman: The amount of wages that they're earning

Erik Freeman: don't meet the the expenses that they have

Erik Freeman: in their household, and so the idea of the

Erik Freeman: wage increase is to is to is to guarantee a

Erik Freeman: minimum amount that everybody makes so that

Erik Freeman: they can afford the living wages.

Mark Haney: Yeah, okay.

Mark Haney: So I mean there's so many ways to take this

Mark Haney: conversation, but I just want to make sure

Mark Haney: we have both sides of the, of the whatever

Mark Haney: we'll call it, the argument, if you will,

Mark Haney: or the opinions of both sides, because you

Mark Haney: know, if you're, if you're working at a

Mark Haney: fast food location, you may view this as a

Mark Haney: good thing.

Mark Haney: I don't know, or you may not, but what ends

Mark Haney: up happening for somebody who owns a

Mark Haney: business, or probably for for any of us,

Mark Haney: whether you're in fast food or not, if this

Mark Haney: group of people is getting paid 20 bucks an

Mark Haney: hour and this group of people is getting

Mark Haney: paid it's called 1550 an hour, or maybe

Mark Haney: even 20 bucks an hour over here it's going

Mark Haney: to cause everybody to kind of have to

Mark Haney: ratchet up their wages to stay market

Mark Haney: competitive.

Mark Haney: Everybody's going to have to raise their

Mark Haney: wages a little bit, or maybe the full 25%,

Mark Haney: just to kind of keep with market wages,

Mark Haney: right.

Mark Haney: So everybody's wages are going to go up a

Mark Haney: little bit or some.

Mark Haney: And is that a good thing or a bad thing?

Mark Haney: I mean, it just it's a, it's an artificial

Mark Haney: effect on the market and we're all going to

Mark Haney: have to make adjustments.

Erik Freeman: I think that's the biggest fear.

Erik Freeman: Is you know at some point and I can say

Erik Freeman: even for for our business at some point,

Erik Freeman: the perception of what you have to charge

Erik Freeman: for your food in order to make these, you

Erik Freeman: know, these, these inflationary pressures

Erik Freeman: or or some of these increases in wages at

Erik Freeman: some point?

Erik Freeman: The question is is a customer willing to

Erik Freeman: pay that?

Erik Freeman: So for us, in order to, let's say, tackle

Erik Freeman: this right and every year we've had to

Erik Freeman: raise our ground beef taco right to to

Erik Freeman: every year to get to a how much is a ground

Erik Freeman: beef?

Erik Freeman: taco these days, it's currently 295 for one

Erik Freeman: taco for one taco.

Mark Haney: And already feeling the inflation, I mean

Mark Haney: I'm not saying that's an unfair price,

Mark Haney: that's a.

Mark Haney: That's an affordable meal.

Mark Haney: You know, you get a couple of tacos and a

Mark Haney: drink and maybe something else.

Mark Haney: It's like 10 bucks.

Mark Haney: It's still an affordable meal.

Erik Freeman: And, and the biggest fear I think for

Erik Freeman: restaurant owners is at what point does a

Erik Freeman: customer say I'm unwilling to pay this for

Erik Freeman: this food?

Erik Freeman: You know, whatever it it might be, if it's

Erik Freeman: a gym boys taco, if it, if it turns into

Erik Freeman: being $4 for one ground beef taco, Okay,

Erik Freeman: yeah, we're certainly now addressing the

Erik Freeman: minimum wage, and that's what we need in

Erik Freeman: order to do minimum wage, and I'm

Erik Freeman: exaggerating a little bit, but you can see

Erik Freeman: where this could go.

Erik Freeman: Certainly, over the next two, three years,

Erik Freeman: prices will have to continue to increase,

Erik Freeman: and so the the fear and concern is is

Erik Freeman: someone willing to pay, you know, $4 for a

Erik Freeman: ground beef taco?

Mark Haney: Well, it's an interesting time to do it

Mark Haney: when we've printed all this money, right,

Mark Haney: inflationary type of decision to print a

Mark Haney: bunch of money we we have, you know, our

Mark Haney: debt and interest rates have gone up, so

Mark Haney: our interest payments on the national debt

Mark Haney: and all that are going up.

Mark Haney: So all of that is driving a bunch of other

Mark Haney: inflation, right, De-coupling from China

Mark Haney: and on and on and on.

Mark Haney: There's a lot of inflationary sort of

Mark Haney: pressure out there and everybody realizes

Mark Haney: that.

Mark Haney: You know, price at the pump, that we have

Mark Haney: inflation, right, we do.

Mark Haney: We've.

Mark Haney: There's a lot more money chasing, you know,

Mark Haney: chasing the goods, and it's causing stuff

Mark Haney: to go up in price.

Mark Haney: And so now the most affordable meal that we

Mark Haney: might want to buy, right, it's cheaper to

Mark Haney: go buy have dinner at gym boys than to go

Mark Haney: go to the grocery store and buy some

Mark Haney: groceries and make it.

Mark Haney: And now you're taking the most affordable

Mark Haney: meal in the world and you're causing that

Mark Haney: to go up too.

Mark Haney: It's like is that good?

Mark Haney: Is it good timing?

Mark Haney: I mean, my goodness.

Erik Freeman: Well, and in addition to this and I think

Erik Freeman: this is maybe one thing that's good to

Erik Freeman: address as well is that, even though this

Erik Freeman: is targeted towards brands that have 60

Erik Freeman: locations or more, that doesn't mean that

Erik Freeman: it's going to radically change.

Erik Freeman: It won't radically change the industry.

Erik Freeman: It will because everyone is going to demand

Erik Freeman: that $20 minimum wage.

Erik Freeman: There's only so many jobs that are going to

Erik Freeman: be available for the bigger brands, so to

Erik Freeman: speak, so all the customers or, excuse me,

Erik Freeman: all the laborers and employees are going to

Erik Freeman: want that same way.

Mark Haney: They want a $4.50 increase or a pro-rata

Mark Haney: percentage increase.

Erik Freeman: Who this ends up actually hurting the most

Erik Freeman: are the small businesses, not the large

Erik Freeman: businesses, even though that's what the

Erik Freeman: bill is targeting.

Erik Freeman: It's targeting larger guys, but who it

Erik Freeman: hurts the most are the smaller guys,

Erik Freeman: because their margins are as thin as it is.

Erik Freeman: They don't have the same luxury buying

Erik Freeman: capacity.

Erik Freeman: They don't have the same buying power or

Erik Freeman: leveraging that bigger brands are able to

Erik Freeman: do.

Erik Freeman: So, while it might hurt the bigger brands,

Erik Freeman: ultimately it's going to really hurt the

Erik Freeman: smaller guys.

Mark Haney: Yeah, and I think ultimately it hurts the

Mark Haney: consumer because it's one.

Mark Haney: You know, I can barely make my rent payment,

Mark Haney: I can barely make my house payment and now

Mark Haney: I got to put food on the.

Mark Haney: I mean, food is a main thing.

Mark Haney: So an affordable meal is a fast food meal.

Mark Haney: And today, you know, when I was a kid, you

Mark Haney: know, go get fast food.

Mark Haney: Maybe that was a luxury or whatever.

Mark Haney: That was like a maybe a more expensive meal

Mark Haney: than my mom making macaroni and tomatoes

Mark Haney: and the crap that we ate around our house.

Mark Haney: But now that's a cheap way.

Mark Haney: You know that's a cheap way to go out to

Mark Haney: dinner or to have a meal is to have a, you

Mark Haney: know, some fast food.

Mark Haney: Yeah, I mean, it's on the cheaper side.

Erik Freeman: Yeah, and now and now that's not the case.

Erik Freeman: Now it is with, like I said, with this

Erik Freeman: labor increase.

Erik Freeman: We are looking at a 25% increase and again

Erik Freeman: just to put that in perspective, that's

Erik Freeman: never occurred before.

Erik Freeman: There's never been a $4 an hour increase in

Erik Freeman: a single year.

Erik Freeman: I think in the hit, certainly in

Erik Freeman: California's history, I believe nationwide

Erik Freeman: it is.

Erik Freeman: It is unprecedented.

Erik Freeman: And yeah, to come out and you know, now of

Erik Freeman: all time, it will certainly put a strain on

Erik Freeman: things.

Erik Freeman: The big question I think a lot of

Erik Freeman: restaurant owners are going to have is how

Erik Freeman: much of this can they pass along to the

Erik Freeman: consumer?

Erik Freeman: Usually, restaurant owners they pass the,

Erik Freeman: they pass these, these costs on to the

Erik Freeman: consumer, but not all of them.

Erik Freeman: They always have to absorb a little bit of

Erik Freeman: it and the question is how much of this can

Erik Freeman: they really absorb this time?

Mark Haney: Interesting.

Mark Haney: Okay.

Mark Haney: So now the other question is how can I

Mark Haney: tweak my business to deal with this Right?

Mark Haney: So can I turn my business into a luxury

Mark Haney: product, luxury brand?

Mark Haney: Can I automate and go lean and mean and

Mark Haney: have this automated type, automated type

Mark Haney: thing?

Mark Haney: How are we going to?

Mark Haney: What kind of changes are the smart guys

Mark Haney: going to make?

Erik Freeman: Yeah, so so a couple things there, and I'll

Erik Freeman: start with this is this is a brand new bill.

Erik Freeman: This is brand new.

Erik Freeman: I mean, this is an active, ongoing

Erik Freeman: conversation.

Erik Freeman: I've had a lot of conversations with

Erik Freeman: different restaurant owners.

Erik Freeman: We are all actively talking about what we

Erik Freeman: can do about this.

Mark Haney: So we are still in the in the stages of

Mark Haney: brainstorming, really trying to pick

Mark Haney: yourself up off the floor.

Mark Haney: Are you kidding me?

Mark Haney: Oh, my god.

Erik Freeman: But I will say, and that's why I feel that

Erik Freeman: the biggest advice to all restaurant owners

Erik Freeman: and to all business owners is to talk about

Erik Freeman: this.

Erik Freeman: Get together now, start collaborating now.

Erik Freeman: It wouldn't hurt to start brainstorming

Erik Freeman: with everybody that you can about what's

Erik Freeman: coming and to start sharing this, because

Erik Freeman: even if you do share, it's still going to

Erik Freeman: be an effect on everyone.

Mark Haney: Well, interesting, because, okay, so I want

Mark Haney: to challenge this in a way that is

Mark Haney: productive, I suppose, in terms of getting.

Mark Haney: I'm all about collaboration and so and I

Mark Haney: think, working together for solutions and

Mark Haney: that kind of thing.

Mark Haney: But you, in order to win, we need to be

Mark Haney: differentiated, right?

Mark Haney: So you, if you're the one that comes up

Mark Haney: with the creative idea on how to battle

Mark Haney: this, you want, might want, to be first to

Mark Haney: market with it, and something like that.

Mark Haney: Is there any kind of thought like that, in

Mark Haney: terms of like, what are we going to do?

Mark Haney: Oh, no, let's share our ideas and all go do

Mark Haney: the same thing.

Mark Haney: So there's that one challenge that I have.

Mark Haney: My, my brain goes how do I turn this into

Mark Haney: an advantage?

Mark Haney: You know, as I mentioned, luxury brand, if

Mark Haney: I can repackage my offering to appear to be

Mark Haney: better or to be better, can I get more

Mark Haney: margin and so on to make up for the you

Mark Haney: know what the government's doing to me?

Mark Haney: Or can I automate, or something like that?

Mark Haney: And then I also wonder is there any risk of

Mark Haney: being accused of colluding?

Mark Haney: Because we're talking about price pricing,

Mark Haney: right, and we know you can't get together

Mark Haney: and all decide to.

Mark Haney: You know, price fix tacos at, you know, at

Mark Haney: a higher price.

Mark Haney: And hey, I'll raise my tacos a dollar if

Mark Haney: you do too right.

Mark Haney: We can't do that kind of stuff, so makes me

Mark Haney: kind of wonder about how to collaborate

Mark Haney: effectively.

Erik Freeman: Yeah, yeah, sure, so well, and I can.

Erik Freeman: For me, it's easy for me to say listen.

Erik Freeman: I think the questions are, you know, among

Erik Freeman: everyone it's just trying to get an

Erik Freeman: understanding of the need, the percentage

Erik Freeman: increase.

Erik Freeman: I don't think there's any way that all

Erik Freeman: restaurants can get together for you know,

Erik Freeman: and start colluding.

Erik Freeman: I think collaboration is hey, you know, for

Erik Freeman: us our challenge is do we increase prices

Erik Freeman: once or three times in smaller increments?

Erik Freeman: Those are strategies that I don't think

Erik Freeman: have any bearing on what it will do to the

Erik Freeman: market, but it's certainly something to

Erik Freeman: share for for different owners of saying,

Erik Freeman: hey, how do we effectively tackle this?

Erik Freeman: Because for us our price increase need is

Erik Freeman: going to be different than someone else's

Erik Freeman: price increase need, right.

Erik Freeman: So for someone else, for them just to be

Erik Freeman: able to handle this, they might have to be

Erik Freeman: able to raise it 15% on their menu prices

Erik Freeman: versus another brand that only needs to go

Erik Freeman: up five or six, you know, depending on the

Erik Freeman: size of it.

Erik Freeman: But I certainly think, talking about how

Erik Freeman: that affects them, and I don't think, I

Erik Freeman: certainly think that smaller restaurants

Erik Freeman: don't have the tools that that other brands

Erik Freeman: have to understand how much they may need

Erik Freeman: to increase prices.

Erik Freeman: I mean for them, they may be taking a stab

Erik Freeman: at the dark and saying, oh, you know, I

Erik Freeman: think I need to increase, you know $2 or $3.

Erik Freeman: Well, that might you know.

Erik Freeman: If it's on a really good item, that might

Erik Freeman: be a 20% increase.

Erik Freeman: You know, you may want to try different

Erik Freeman: tactics that have a more smooth and

Erik Freeman: transitional effect, so it doesn't impact

Erik Freeman: everybody the same way.

Erik Freeman: So those are tools, those are, those are

Erik Freeman: strategies.

Erik Freeman: I think that don't affect the price,

Erik Freeman: colluding or anything like that.

Erik Freeman: It's just strategies that people can share.

Mark Haney: I wonder if there's any, and I'm not saying

Mark Haney: this is a good long term strategy, because

Mark Haney: the market ultimately I'm a market guy.

Mark Haney: Right, I want the market to play out when

Mark Haney: everything gets priced at and so on, and

Mark Haney: the market will price out what you know.

Mark Haney: This new regulation will happen and now the

Mark Haney: market will price out what you got to pay

Mark Haney: an employee to make a taco.

Mark Haney: But is there any short term gain for the

Mark Haney: people under 60 employee or, excuse me, 60

Mark Haney: restaurants in that you could postpone your

Mark Haney: wage hikes for some period of time and

Mark Haney: potentially still inch up your margins at

Mark Haney: the same rate as everybody else and maybe

Mark Haney: gain the system for a little bit of time?

Mark Haney: Ultimately, you're going to be underpaying.

Mark Haney: You know you won't be paying market for

Mark Haney: some period of time until you start having

Mark Haney: culture issues in your with your staff.

Mark Haney: But is there any short term good that you

Mark Haney: can kind of eke out of it to take that

Mark Haney: excess earnings, if you will it's hard to

Mark Haney: say excess earnings, those earnings and and

Mark Haney: kind of invest it into something?

Mark Haney: I'm just wondering is there a way to sort

Mark Haney: of play it that way and justify it,

Mark Haney: especially to company your size?

Erik Freeman: Certainly there's there's short term and

Erik Freeman: long term, and within short term there's

Erik Freeman: there's a whole decision tree of things to

Erik Freeman: talk about, which I'll cover in one moment.

Erik Freeman: The long term, I think, is that it

Erik Freeman: ultimately will go automation, but the the

Erik Freeman: the current issue is that when it comes to

Erik Freeman: automation, it's not a one for one, number

Erik Freeman: one.

Erik Freeman: If you have a robot, let's say, that is

Erik Freeman: doing a particular function, it's not going

Erik Freeman: to replace one person.

Erik Freeman: So if you have a robot, it might replace

Erik Freeman: half of a person.

Erik Freeman: So it it's.

Erik Freeman: It's still something that you have to weigh

Erik Freeman: out in terms of how much do you have to

Erik Freeman: invest in getting this piece of equipment

Erik Freeman: or this thing developed versus how much it

Erik Freeman: really replaces in your store and the, of

Erik Freeman: course, the challenge is that in the

Erik Freeman: restaurant industry there's a lot of

Erik Freeman: customization, you know.

Erik Freeman: So for us, for example, to flip the taco,

Erik Freeman: you know, is a pretty difficult task for a

Erik Freeman: robot to perform or automated to perform,

Erik Freeman: and it will take a lot of money to develop

Erik Freeman: and it's really only for our benefit,

Erik Freeman: whereas someone else are going to need an

Erik Freeman: entirely different system set up for them.

Erik Freeman: I know it's going to get there, but will it

Erik Freeman: get there economically For us in the next

Erik Freeman: two years?

Erik Freeman: Probably not.

Erik Freeman: It's something that restaurant owners need

Erik Freeman: to keep their eye on.

Erik Freeman: Ultimately, that's where it's going to go.

Erik Freeman: On the short term to what you were talking

Erik Freeman: about, there's another school of thought,

Erik Freeman: which is okay as a restaurant owner, and

Erik Freeman: this and I think, the real, the name of the

Erik Freeman: game.

Erik Freeman: This is certainly what the CEO of

Erik Freeman: McDonald's is talking about.

Erik Freeman: It's about market share and that is code

Erik Freeman: for taking up customers from other

Erik Freeman: restaurants.

Erik Freeman: That's code for businesses potentially

Erik Freeman: going out of business.

Erik Freeman: But that is what the battle is gonna be for.

Erik Freeman: It's gonna be for market share.

Erik Freeman: So one school of thought might be if I hold

Erik Freeman: off right, if I hold off on doing price

Erik Freeman: increases, do I have an opportunity to

Erik Freeman: undercut or to be more competitive with my

Erik Freeman: prices for against these larger chains?

Erik Freeman: And yeah, that, of course, is a possibility.

Erik Freeman: There's no doubt about it.

Erik Freeman: On the other side of that, it could be well

Erik Freeman: if everybody else is raising their prices.

Erik Freeman: This might be your only chance to take some

Erik Freeman: of those profits ahead of time that you can

Erik Freeman: reinvest into marketing later, I will say

Erik Freeman: is I think the consensus that I'm getting

Erik Freeman: at so far everyone's gonna have to do price

Erik Freeman: increases.

Erik Freeman: But I think what I would advise is coming

Erik Freeman: up with a way that you can treat your

Erik Freeman: existing customers like gold.

Erik Freeman: And for us that's gonna be.

Erik Freeman: Loyalty.

Erik Freeman: For us that's gonna be.

Erik Freeman: We have an app that we're doing.

Erik Freeman: For example, in December we're doing a 12

Erik Freeman: days of Christmas promotion, but it's app

Erik Freeman: focused and I think the idea for people, if

Erik Freeman: you don't have an app, you need to come up

Erik Freeman: with something that treats your customers

Erik Freeman: like gold and that might be a specific

Erik Freeman: loyalty or a specific program that keeps

Erik Freeman: them coming back, because market share

Erik Freeman: means them and other businesses are gonna

Erik Freeman: be competing for that particular customer.

Erik Freeman: So coming up with something that's unique,

Erik Freeman: that can hold that customer or get them to

Erik Freeman: come more often, I think is gonna be the

Erik Freeman: name of the game going forward.

Mark Haney: Yeah, interesting.

Mark Haney: So still so many ways of taking this

Mark Haney: conversation.

Mark Haney: I'm thinking about what you mentioned

Mark Haney: around automation.

Mark Haney: I wanna take it down that path for a second

Mark Haney: and cause you understand this better than I

Mark Haney: do.

Mark Haney: How much automation is coming, whether it

Mark Haney: be at a McDonald's or a major chain like

Mark Haney: that, a national chain or even

Mark Haney: international, where you go to other

Mark Haney: countries and they're somewhat more

Mark Haney: automated than what we are in some places

Mark Haney: and what's coming already, and how much

Mark Haney: that reduces the number of employees that

Mark Haney: we need to have.

Mark Haney: So you think about a company or, excuse me,

Mark Haney: a location that has maybe very few

Mark Haney: employees working at a time.

Mark Haney: Let's say you've got two employees.

Mark Haney: How many people working at a gym boys at an

Mark Haney: off peak hour?

Erik Freeman: Probably four, four or five.

Mark Haney: Okay.

Mark Haney: So you're even now at an off peak hour,

Mark Haney: you've got four employees.

Mark Haney: I'm sure there's some fast food places that

Mark Haney: have two people working, right.

Mark Haney: So you have two people working and my mind

Mark Haney: cause I'm a security guy right, I sell

Mark Haney: security cameras and you know, I've been in

Mark Haney: that business for a long time and I keep

Mark Haney: thinking I used to own a bunch of video

Mark Haney: stores and I keep thinking that you start

Mark Haney: getting down to a location with one to two

Mark Haney: people and now you're driving an automation,

Mark Haney: now I've got one person working alone.

Mark Haney: One person with automation it's not a safe

Mark Haney: place.

Mark Haney: They're already working.

Mark Haney: Retail can feel a little bit unsafe at

Mark Haney: times it's depending on what area you're in

Mark Haney: and now you're one person working alone in

Mark Haney: a fast food place and like, ah, that

Mark Haney: doesn't feel good, Well, and the culture

Mark Haney: right.

Mark Haney: I mean, I think you have to yeah we're so

Mark Haney: fun.

Erik Freeman: It's exactly right.

Erik Freeman: I mean, I guess the employee in the month

Erik Freeman: is the same employee.

Erik Freeman: But other than that, I mean, what do you do?

Erik Freeman: And on top of that it is important to

Erik Freeman: consider, there needs to be a technician of

Erik Freeman: some sort, someone who is going to be

Erik Freeman: maintaining the equipment, the maintaining

Erik Freeman: the automation, making sure that there's no

Erik Freeman: glitches or issues.

Erik Freeman: And if there is an issue right, it's not

Erik Freeman: something that can be fixed by, most likely,

Erik Freeman: the employee that's there.

Erik Freeman: It has to be someone who has the skill and

Erik Freeman: technical abilities to solve it.

Erik Freeman: So there is a lot of moving parts, a lot

Erik Freeman: more moving parts than I think everybody

Erik Freeman: thinks.

Erik Freeman: Certainly, in the five year or six year

Erik Freeman: version of this it's gonna be a lot more, I

Erik Freeman: think, easier for people to bear, but for

Erik Freeman: right now it is costly, it's gonna be hard

Erik Freeman: on the culture, it'll be hard on employees

Erik Freeman: and it won't be a one-to-one.

Erik Freeman: So that, I think, is the biggest challenge.

Mark Haney: Yeah, what other do you think?

Mark Haney: Advice, I guess so, to your fellow.

Mark Haney: Who's your guys' biggest competition?

Mark Haney: Just kinda curious.

Mark Haney: I'm picturing the one the gym boys by my

Mark Haney: house and it actually feels good.

Mark Haney: Gym boys is right next to Beechia, which is

Mark Haney: next to Mod Pizza, which is next to some

Mark Haney: chicken wing place and I think there's a

Mark Haney: Japanese restaurant.

Mark Haney: You know a lot of fast foodie-type places

Mark Haney: right there, starbucks, not too far away.

Mark Haney: All that's going through my mind is these

Mark Haney: restaurants wanna be kinda around other

Mark Haney: restaurants and stuff like that.

Mark Haney: They don't really view them as competitors.

Mark Haney: It's more like look, that's, we're gonna

Mark Haney: eat somewhere in that little shopping

Mark Haney: center.

Mark Haney: But is there like a direct competitor to

Mark Haney: you guys that you guys feel right now?

Erik Freeman: You know, I think it's hard to say.

Erik Freeman: I think, at the end of the day, the direct

Erik Freeman: competitors would be the Chipotle's of the

Erik Freeman: world.

Mark Haney: Okay.

Erik Freeman: You know, and yes, taco Bell would be a

Erik Freeman: competitor, not that it's in our space, but

Erik Freeman: the-.

Mark Haney: Taco Bell just tastes different, I mean,

Mark Haney: and so does Chipotle.

Mark Haney: It tastes different than gym boys.

Mark Haney: It's got a way different taste and feel.

Erik Freeman: I think the way that we brand ourselves is

Erik Freeman: that we are we're fast casual.

Erik Freeman: So anything in the fast casual space which

Erik Freeman: is the Beech Hut deli is where would be the

Erik Freeman: Chipotle's or five guys, for instance,

Erik Freeman: those?

Erik Freeman: it's, I think, less about the cuisine, as

Erik Freeman: much the demand for quality that the

Erik Freeman: concept provides.

Erik Freeman: So it doesn't have to be a direct Hispanic.

Erik Freeman: You know concept Right.

Erik Freeman: It can be a, like I said, a sandwich shop,

Erik Freeman: or it can be a pizza place.

Erik Freeman: Those are competitors because we're all

Erik Freeman: competing for that segment, the lunch

Erik Freeman: segment or the dinner segment.

Erik Freeman: So it's great to be a complimentary, but

Erik Freeman: sometimes also they can take more from that

Erik Freeman: segment than-.

Mark Haney: Do you now in terms of pricing because this

Mark Haney: is kind of a pricing question do you, when

Mark Haney: you look at the landscape, do you for gym

Mark Haney: boys, do you see yourself able to charge

Mark Haney: premium pricing Because it sounds

Mark Haney: affordable?

Mark Haney: I mean $299?

Mark Haney: Shock me that because I guess I guess,

Mark Haney: don't look, I never looked at the price to.

Mark Haney: I'm just like I'm the guy that doesn't know

Mark Haney: whether I paid $10 or $15 or whatever, I

Mark Haney: don't know.

Mark Haney: That sounds bad.

Mark Haney: I know it to the audience, but I just don't

Mark Haney: look at that stuff that close.

Mark Haney: My wife does, I guess.

Mark Haney: But when you're pricing, cause it all adds

Mark Haney: up, cause you're selling tons of tacos and

Mark Haney: tons of french fries and tons of stuff, you

Mark Haney: try to price yourself against those other

Mark Haney: people to make sure you're in the same

Mark Haney: realm 100% absolutely.

Mark Haney: Okay.

Erik Freeman: We compare ourselves with Del Taco.

Erik Freeman: We'll look at what they what they're

Erik Freeman: pricing.

Erik Freeman: We'll look at Chipotle what they're pricing.

Erik Freeman: We'll look at Q Doba, which isn't really

Erik Freeman: around here, but we still look at what

Erik Freeman: their pricing is.

Erik Freeman: We look at Pollo Loco as well, what their

Erik Freeman: pricing is.

Erik Freeman: We do a competitive analysis.

Erik Freeman: I would advise any owner to be doing this,

Erik Freeman: if they're not already to just take

Erik Freeman: snapshots every month to see whether the

Erik Freeman: prices of their competitors have changed or

Erik Freeman: not and by how much.

Erik Freeman: And that helps figure out a little bit

Erik Freeman: about what you could do and what the market

Erik Freeman: can bear for you.

Mark Haney: Are there premium or, excuse me so it goes

Mark Haney: through my mind about there's ways to cut

Mark Haney: portion sizes and there's a way you could

Mark Haney: revamp the taco so that you get less of a

Mark Haney: taco or something like that, or a little

Mark Haney: few less fries or whatever.

Mark Haney: You take away some of the amenities or some

Mark Haney: of the value, I guess, out of the equation

Mark Haney: and maybe not raise the prices much.

Mark Haney: You think you guys are gonna see some of

Mark Haney: that kind of stuff too.

Erik Freeman: So I love that you bring that up, because

Erik Freeman: we looked into that ourselves about two

Erik Freeman: years ago and it's kind of they call it

Erik Freeman: it's called America on a Diet.

Mark Haney: They call it kind of shrink flange in a way

Mark Haney: right.

Erik Freeman: Where it's hidden.

Erik Freeman: You keep the price the same, but you will

Erik Freeman: change the portion size.

Erik Freeman: Well, we did look into it and I think

Erik Freeman: ultimately what we found, in order for it

Erik Freeman: to make a difference, we had to change our

Erik Freeman: portions by like 20% 15 to 20% on our

Erik Freeman: portions and I think when we really looked

Erik Freeman: at that, it just didn't sit right with what

Erik Freeman: the demand of the customer.

Erik Freeman: You're actually a perfect example.

Erik Freeman: You're not looking at the prices right.

Erik Freeman: You wouldn't notice necessarily a two,

Erik Freeman: three, four or 5% price increase, but I bet

Erik Freeman: you would notice the portion decrease.

Erik Freeman: Right and so even though you're paying.

Erik Freeman: If we were to cut-.

Mark Haney: I get a word of three chocos now, or two

Mark Haney: versus two, or whatever it is.

Erik Freeman: And, at the end of the day, I think that's

Erik Freeman: a decision that every restaurant owner, of

Erik Freeman: course, can look at.

Erik Freeman: But for us portions, we felt that was an

Erik Freeman: untouchable for our customer.

Mark Haney: Interesting.

Mark Haney: Yeah, these are really interesting strategy

Mark Haney: decisions.

Mark Haney: Okay, so what am I not talking about?

Mark Haney: I mean, I'm kind of coming up with all the

Mark Haney: questions here, but is there a certain

Mark Haney: aspect of this that I'm not addressing?

Erik Freeman: Well, I appreciate that.

Erik Freeman: I think, as I mentioned, the two immediate

Erik Freeman: questions that a restaurant owner needs to

Erik Freeman: look at is one how much and how often are

Erik Freeman: you gonna be increasing your prices from

Erik Freeman: here until April?

Erik Freeman: If that's the route you wanna go?

Erik Freeman: Market share all right, is that something?

Erik Freeman: How are you going to compete for market

Erik Freeman: share, because that's what everybody else

Erik Freeman: is gonna be doing in the immediate future,

Erik Freeman: and how are you going to be thinking about

Erik Freeman: your existing customers and really now

Erik Freeman: modeling your business to treat them like

Erik Freeman: gold, because they're gonna be the ones

Erik Freeman: that get you through this next step?

Erik Freeman: There's a lot of, I think, internal and

Erik Freeman: this is where I opened it up, where I'd

Erik Freeman: love to make myself available or anyone

Erik Freeman: available to talk this through because

Erik Freeman: there's a lot of internal conversations

Erik Freeman: that owners need to have about how they're

Erik Freeman: going to, how they're gonna tackle the wage

Erik Freeman: increase, the minimum wage increase.

Erik Freeman: There's different overtime conversations.

Erik Freeman: There's staffing conversations.

Erik Freeman: There's a lot of internal things that go on

Erik Freeman: in the restaurant that is specifically

Erik Freeman: tailored towards employees.

Erik Freeman: That's something I think is more beneficial

Erik Freeman: to have one-on-one conversations and direct

Erik Freeman: conversations with owners on, but and

Erik Freeman: that's a tackling this directly with how

Erik Freeman: you're gonna deal with the minimum wage

Erik Freeman: increase.

Erik Freeman: But on the other side I think that's where

Erik Freeman: it's very open to everybody else also

Erik Freeman: talking about hey, we have how many price

Erik Freeman: increases are you gonna do?

Erik Freeman: What's McDonald's doing?

Erik Freeman: What's in and out doing?

Erik Freeman: How many times are they gonna increase

Erik Freeman: their prices?

Erik Freeman: I can guarantee you it won't be just one.

Erik Freeman: They're not gonna do just one 10, 15, 20%

Erik Freeman: increase.

Erik Freeman: It will be two, maybe three that they're

Erik Freeman: gonna do between now and between April.

Erik Freeman: So keep your eye on that and keep a look on

Erik Freeman: it.

Erik Freeman: I think there's other.

Erik Freeman: There's certainly.

Erik Freeman: I think another competitive advantage here

Erik Freeman: that I can talk about is you're not

Erik Freeman: necessarily gonna be able to compete on

Erik Freeman: wages, and what I mean by that is a larger

Erik Freeman: brand might be spending.

Erik Freeman: They might be paying $24 an hour to get the

Erik Freeman: best type of employees.

Erik Freeman: What your competitive advantage is gonna be

Erik Freeman: is how you treat that employee as an owner.

Erik Freeman: How flexible are you with their schedule as

Erik Freeman: an owner?

Erik Freeman: How flexible are you with their personal

Erik Freeman: life?

Erik Freeman: How well do you know them?

Erik Freeman: What things does that employee care about

Erik Freeman: that you can help cater to or help make

Erik Freeman: easier on their life.

Erik Freeman: That, I think, is gonna be a really big

Erik Freeman: issue.

Erik Freeman: And something really important coming up

Erik Freeman: here is the employees that are looking for

Erik Freeman: not just the money, and sometimes instead

Erik Freeman: of the money, they might wanna see instead

Erik Freeman: more flexibility and more relational terms

Erik Freeman: with the owner.

Erik Freeman: I certainly know that during the COVID era,

Erik Freeman: that's how a lot of owners were able to get

Erik Freeman: through.

Erik Freeman: It is that they just had solid employees

Erik Freeman: who they had really good relationships with

Erik Freeman: and they were able to get through that and

Erik Freeman: I think going forward, that's gonna be

Erik Freeman: probably more important than anything,

Erik Freeman: especially for smaller businesses, for

Erik Freeman: smaller restaurant owners.

Erik Freeman: That relationship is gonna be gold.

Mark Haney: Is some of that already happening?

Mark Haney: I'm looking at Starbucks.

Mark Haney: They don't pay minimum wage, do they, or

Mark Haney: they?

Mark Haney: I mean?

Mark Haney: They're not close, I mean they kinda have

Mark Haney: abandoned some of that kind of stuff.

Mark Haney: They've got enough profitability and volume

Mark Haney: and all that scale to create different

Mark Haney: kinds of incentive packages and stuff

Mark Haney: beyond minimum wage.

Erik Freeman: Yeah, certainly their benefit package is

Erik Freeman: going to be stronger than what and that's

Erik Freeman: my point Typically, a benefit package that

Erik Freeman: a uh, a larger brand can offer is going to

Erik Freeman: be more than what you have as a restaurant

Erik Freeman: owner to offer.

Erik Freeman: But, believe me, that does come with

Erik Freeman: conditions.

Erik Freeman: They're there.

Erik Freeman: It's not going to be as personable as a

Erik Freeman: feel as knowing you know the as the owner,

Erik Freeman: knowing you by first name.

Erik Freeman: You know your owner by first name, the

Erik Freeman: owner knowing about what's going on in your

Erik Freeman: life and being able to accommodate, uh, uh,

Erik Freeman: certain things that come up, and so the the

Erik Freeman: more that an owner can really take that

Erik Freeman: care.

Erik Freeman: Uh, I do think that that's going to uh for

Erik Freeman: for a lot of employees.

Erik Freeman: If we're talking about the difference

Erik Freeman: between two or three or $4 an hour, I think

Erik Freeman: that's going to end up becoming more

Erik Freeman: important than just the $4 an hour.

Erik Freeman: Scheduling, staffing, the amount of hours

Erik Freeman: worked, those things are uh going to be a

Erik Freeman: little bit higher of a standard when you're

Erik Freeman: working at these bigger brands and they

Erik Freeman: have these benefit packages, but it does

Erik Freeman: come with a little bit of a cost.

Mark Haney: And the other thing I would say to anybody

Mark Haney: that might be listening out there that is

Mark Haney: either working in fast food, or maybe

Mark Haney: they're a parent and your child's in high

Mark Haney: school and thinking about getting a job in

Mark Haney: fast food is like what you can learn

Mark Haney: working for an independent company where

Mark Haney: you have access to an Eric Freeman or you

Mark Haney: know the owner of the business.

Mark Haney: I mean that's a different kind of learning

Mark Haney: experience because I mean, really we're

Mark Haney: doing it for the money.

Mark Haney: Of course we want to paycheck and all that

Mark Haney: kind of stuff, but really you think back to

Mark Haney: your first job, right, parent?

Mark Haney: Think back to your first job.

Mark Haney: What kind of experience did you have?

Mark Haney: Did you learn some stuff?

Mark Haney: Did you get some valuable lessons where

Mark Haney: these kind of the kind of lessons that last

Mark Haney: at a lifetime yeah, they did.

Mark Haney: It's like the first, your first girlfriend,

Mark Haney: your first job, those kinds of things.

Mark Haney: Like you remember those things for the rest

Mark Haney: of your life.

Mark Haney: You want to have your children or if you're

Mark Haney: a child or a young person, or a young

Mark Haney: person getting the first job, or an entry

Mark Haney: level job, maybe getting back in the

Mark Haney: workforce.

Mark Haney: You want that.

Mark Haney: It's going to be a memorable experience and

Mark Haney: so you want to be around people that think

Mark Haney: more entrepreneurially, think more

Mark Haney: creatively, think about how to win.

Mark Haney: We want to be in those kind of environments,

Mark Haney: and so there's a certain value that it's

Mark Haney: almost priceless in a way.

Mark Haney: You know you can go to some job where

Mark Haney: everybody doesn't care about the job and

Mark Haney: it's just kind of a job.

Mark Haney: Or you can go be around a small business

Mark Haney: where mom and pop are giving it everything

Mark Haney: they have and of course they they treat

Mark Haney: their employees like gold.

Mark Haney: They're like their employees, are like

Mark Haney: family, and what a much better experience

Mark Haney: in terms of getting your first or second

Mark Haney: job and being around somebody who thinks of

Mark Haney: you like family and you're actually

Mark Haney: learning life skills instead of you know

Mark Haney: how to be number three on the cashier, you

Mark Haney: know rack or cashier table.

Mark Haney: It's so much better to work for a small

Mark Haney: business than work for some giant fast food

Mark Haney: chain.

Mark Haney: I would think I have to imagine as a guy

Mark Haney: that used to own a bunch of video stores.

Mark Haney: We work for Blockbuster, we work for me.

Mark Haney: Of course you're going to get a lot better

Mark Haney: experience working for me.

Erik Freeman: I completely and 100% agree Restaurant

Erik Freeman: owners are.

Erik Freeman: They are, they're a breed all on themselves.

Erik Freeman: They go to work.

Erik Freeman: A lot of them, they especially the smaller

Erik Freeman: ones they go to work every day.

Erik Freeman: They are there, they are there in the

Erik Freeman: middle of the night, they're there in the

Erik Freeman: early parts of the morning there, and

Erik Freeman: that's just what you see.

Erik Freeman: Then there's the amount of work that they

Erik Freeman: do on the back end that nobody ever sees.

Erik Freeman: It is.

Erik Freeman: It is a backbreaking job, mentally,

Erik Freeman: physically, emotionally.

Erik Freeman: And you know, there's no doubt, if you can

Erik Freeman: see how a restaurant owner can persevere,

Erik Freeman: that should be an inspiration and something

Erik Freeman: that you can take with you for the rest of

Erik Freeman: your life.

Mark Haney: America, youth or your parents.

Mark Haney: We need that right.

Mark Haney: We, now more than ever, we need to learn

Mark Haney: work ethic and, you know, be inspired by

Mark Haney: people who put it all out on the line.

Mark Haney: Those are the kind of people we we should

Mark Haney: want our children to be around and want if

Mark Haney: it's us want, that's the people I mean.

Mark Haney: I invest in the startups.

Mark Haney: It's not the highest paying, you know gig

Mark Haney: in the world, but you know what it's

Mark Haney: inspiring and it makes me feel good about

Mark Haney: me to be working with this group of people

Mark Haney: with small business.

Mark Haney: So, um, all right.

Mark Haney: What else did I not cover?

Mark Haney: Because the other thing I was going to go

Mark Haney: to is I'm just picturing the ripple effect

Mark Haney: of this.

Mark Haney: You know I'm still scratching my head over

Mark Haney: how we're continuing to print money knowing

Mark Haney: that all it does is cause inflation.

Mark Haney: Now we do something like this.

Mark Haney: I have to imagine, you know, the gas

Mark Haney: station.

Mark Haney: You know on the on the opposing corner is

Mark Haney: going to be like wait.

Mark Haney: I could go over and work at the fast food

Mark Haney: place and make five bucks more an hour than

Mark Haney: I can being a cashier.

Mark Haney: You know what I got to feed my family.

Mark Haney: I'm going to be drawn to fast food.

Mark Haney: I'm going to be bouncing from Walmart or

Mark Haney: these other organizations that are paying

Mark Haney: minimum wage.

Mark Haney: I'm going to make 20 bucks an hour over at

Mark Haney: gym boys or wherever, um that other people

Mark Haney: are going to suffer.

Mark Haney: So there's this ripple effect, or these

Mark Haney: unintended consequences that are just going

Mark Haney: to show up on us.

Erik Freeman: You hit the nail on the head, mark.

Erik Freeman: That's, I think, the uh, when, when I say

Erik Freeman: don't uh, don't think that this won't

Erik Freeman: affect you, that's exactly what I mean.

Erik Freeman: There is every industry is going to have

Erik Freeman: this effect, and you use the convenience

Erik Freeman: store.

Erik Freeman: That's a perfect example.

Erik Freeman: Any retail outlet of any kind clothing, uh,

Erik Freeman: apparel or or jewelry or or anything out

Erik Freeman: there they're going to ask that same

Erik Freeman: question why is it that now I uh am, am

Erik Freeman: below this particular wage that uh, that

Erik Freeman: the restaurant industry gets?

Erik Freeman: And it will spur, believe me, conversations

Erik Freeman: and push back from employees with their

Erik Freeman: employers.

Erik Freeman: The employers are now going to be forced to

Erik Freeman: think about how much they have to pay and

Erik Freeman: it's most likely going to become that $20

Erik Freeman: minimum is going to be, I think, easily

Erik Freeman: become the minimum for everyone, just,

Erik Freeman: unintentionally, just that's the downstream

Erik Freeman: consequences of when you implemented in one

Erik Freeman: uh, in one facet of the of the industry.

Erik Freeman: It's going to it's going to ripple through

Erik Freeman: the remaining industries with exactly that

Erik Freeman: type of mentality.

Erik Freeman: Okay.

Mark Haney: So I'm going to switch subjects a little

Mark Haney: bit.

Mark Haney: I want to talk a little bit more about food,

Mark Haney: okay, oh, so that's great conversation.

Mark Haney: I don't think we went overly political,

Mark Haney: although you may have smelled some of our

Mark Haney: political beliefs.

Mark Haney: Look, we're not crying about it, we're

Mark Haney: trying to figure out what we're going to do

Mark Haney: about it.

Mark Haney: Right, we're, part of this makes you want

Mark Haney: to go.

Mark Haney: Are you kidding me?

Mark Haney: But then the other part is like okay, let's

Mark Haney: put that aside.

Mark Haney: Uh, that's not what this show is about.

Mark Haney: This show is about how to win.

Mark Haney: Um, let's talk about food for a second.

Mark Haney: Let's talk about your menu.

Mark Haney: Why is it?

Mark Haney: I mean it's good.

Mark Haney: What do people like the most?

Mark Haney: What's most popular?

Mark Haney: What do people love?

Mark Haney: What's like?

Mark Haney: Look, we can't keep this in stock type

Mark Haney: stuff.

Mark Haney: The ground beef taco Ground beef taco is as

Mark Haney: simple as the ground beef taco.

Erik Freeman: The ground beef taco is by far our most

Erik Freeman: popular item.

Mark Haney: I mean I'm not saying.

Mark Haney: I mean I'm saying this you share it versus

Mark Haney: me sharing it.

Mark Haney: I'm happy to share.

Erik Freeman: We, uh, our tortillas are, uh, they're

Erik Freeman: stone ground tortillas, so it does give

Erik Freeman: their.

Erik Freeman: I think the way that we, uh, we make our

Erik Freeman: food, specifically the taco, uh, you can

Erik Freeman: taste the difference the it is a stone

Erik Freeman: ground tortilla.

Erik Freeman: It's high grade quality cheese, both the

Erik Freeman: Parmesan and the cheese we put on the

Erik Freeman: inside.

Erik Freeman: The ground beef is pillow packed, um, and

Erik Freeman: it's in, uh, california, it's California

Erik Freeman: beef.

Erik Freeman: So we, we definitely take a lot of care

Erik Freeman: into the ingredients that we put into our

Erik Freeman: ground beef taco and I think that you can

Erik Freeman: taste the difference.

Erik Freeman: Um, we make the, the, uh, the ground beef.

Erik Freeman: It's fresh, never frozen, and it's been

Erik Freeman: that way since 1954.

Erik Freeman: We make it every day from scratch, uh, so

Erik Freeman: it is the real deal, uh, and so I think

Erik Freeman: that's, you know, there's always been a

Erik Freeman: demand for that.

Erik Freeman: You know we have a really good bean burrito

Erik Freeman: and those are simple ingredients as well

Erik Freeman: just the uh, just beans and and and cheese,

Erik Freeman: uh, and the way that we griddle it on the

Erik Freeman: uh, on the grill top but, that also is

Erik Freeman: because we make the beans fresh in, you

Erik Freeman: know, and so when you make the beans fresh

Erik Freeman: and you're and you're mashing these things,

Erik Freeman: you know fresh, it it does come across in

Erik Freeman: in the quality of the beans themselves, or

Erik Freeman: triple washed, uh, dried beans that we get

Erik Freeman: and cook from scratch.

Mark Haney: Well, I think the two things, even I'm

Mark Haney: going with my own personal taste here.

Mark Haney: So, um, you mentioned the grill, the way

Mark Haney: you griddle them Okay, I didn't know that

Mark Haney: that was the terminology and but I also the

Mark Haney: Parmesan cheese.

Mark Haney: So I am a fan of that.

Mark Haney: Uh, that griddle defect, if you will,

Mark Haney: versus just the crunchy, uh, or you know

Mark Haney: the, the flour tortilla that doesn't have

Mark Haney: any, um, you know, hasn't been cooked

Mark Haney: beyond the original.

Mark Haney: You know when you, I guess when they

Mark Haney: originally made it, you kind of griddle

Mark Haney: them and they taste, you know, hot off the

Mark Haney: stove type thing and those are great.

Mark Haney: But I think my son Marcus, he was in here a

Mark Haney: second before he got in here and he was

Mark Haney: talking about the Parmesan cheese and

Mark Haney: that's like something, those two things.

Mark Haney: I don't think anybody else really does that,

Mark Haney: do they?

Mark Haney: I mean, taco Bell doesn't do that stuff.

Erik Freeman: No, and that's why we term ourselves as the

Erik Freeman: original American.

Erik Freeman: It's not necessarily authentic.

Mark Haney: They don't do that stuff, it's not an

Mark Haney: authentic Hispanic taco.

Erik Freeman: We've never made that claim.

Erik Freeman: We are an American taco.

Erik Freeman: It's the original American taco my, my

Erik Freeman: grandfather is, you know he's full blooded

Erik Freeman: Norwegian.

Erik Freeman: You know he when, when he was first doing

Erik Freeman: tacos in 1954, no one knew what, what the

Erik Freeman: taco was.

Mark Haney: OK yeah, that was pretty.

Mark Haney: Taco Bell or Chipotle Certainly, obviously,

Mark Haney: certainly.

Erik Freeman: And he came up with a, with a side version

Erik Freeman: of it, of kind of just putting some

Erik Freeman: innovation on it and and it tastes, you

Erik Freeman: know it tastes better.

Erik Freeman: Yeah, the taste is different.

Erik Freeman: It's better than anything.

Erik Freeman: And yeah, we do grill them, you know.

Erik Freeman: Try them next time you have it.

Mark Haney: Is it less healthy?

Mark Haney: I mean, because there's people that are

Mark Haney: like on these health kicks and stuff like

Mark Haney: that, but it tastes so good you're not

Mark Haney: really that worried about it, but is it?

Erik Freeman: that's about 200 calories per per ground

Erik Freeman: beef taco.

Mark Haney: Which honestly isn't bad.

Erik Freeman: You know, you have your.

Erik Freeman: You know, I think for a lot of keto people

Erik Freeman: they would get a lot out of out of our food.

Mark Haney: OK, so that's a keto item.

Erik Freeman: The well, the the.

Erik Freeman: The corn tortilla doesn't necessarily have

Erik Freeman: a lot of a lot of carbs, a lot of net carbs.

Erik Freeman: So there's a lot that you can get.

Erik Freeman: I think, for anybody that has a lot of

Erik Freeman: fitness aspirations, there's there's

Erik Freeman: certainly a lot of items that that you can

Erik Freeman: get that provide a lot of protein, low

Erik Freeman: carbs, you know so.

Erik Freeman: But in general, I think the question that

Erik Freeman: you really want to have is it comes down to

Erik Freeman: the quality of food.

Erik Freeman: If you're going to have, you know, a gym

Erik Freeman: boy, or if you're going to have a taco of

Erik Freeman: any kind, you know, in general, is it

Erik Freeman: healthier than that?

Erik Freeman: That parfait?

Erik Freeman: Probably not, but what it does.

Erik Freeman: But but if you are going to have that, do

Erik Freeman: you want something that's quality?

Erik Freeman: You know it.

Erik Freeman: Do you want?

Erik Freeman: Do you want something that's going to taste

Erik Freeman: right and it's in, and maybe it doesn't hit

Erik Freeman: all of your fitness check boxes, but is it

Erik Freeman: still going to be something that your body,

Erik Freeman: except accepts versus rejects?

Erik Freeman: You know, and a lot of people talk about

Erik Freeman: natural places that have more mass produce

Erik Freeman: produced items and may not be quite as good

Erik Freeman: for your, for your body, and your body kind

Erik Freeman: of rejects it and you can feel that when

Erik Freeman: you have food that is majorly processed.

Mark Haney: OK, ok, only a minute left.

Mark Haney: So what?

Mark Haney: What did I besides Unless there's something

Mark Haney: else you want to talk about in terms of the

Mark Haney: minimum wage, I want to make sure you have

Mark Haney: a chance to present your organization in a

Mark Haney: way that you know, because we got kind of

Mark Haney: technical on wages and stuff like that.

Mark Haney: But I mean, jim Boyce is a it's a

Mark Haney: Sacramento success story and there's a

Mark Haney: reason.

Mark Haney: So maybe, just maybe, a little sales pitch

Mark Haney: on Jim Boyce, because there's a reason

Mark Haney: you've been successful.

Erik Freeman: Well, I would say that for me personally,

Erik Freeman: I've I've grown up on the ground Beef taco.

Erik Freeman: My wife, who I I met.

Erik Freeman: One of the first things that I learned

Erik Freeman: about her is that she liked the bean and

Erik Freeman: cheese burrito with onion.

Erik Freeman: You know, everybody in Sacramento has a Jim

Erik Freeman: Boyce story and when the first time that

Erik Freeman: they tried it because it is different when

Erik Freeman: we go to different places in the country

Erik Freeman: people remember Jim Boyce I would invite

Erik Freeman: anybody that think that a ground beef taco

Erik Freeman: that has parmesan on the outside might be a

Erik Freeman: little bit weird.

Erik Freeman: Just try it and give it a, give it a shot,

Erik Freeman: you know, and try it.

Erik Freeman: And maybe that'll be your first story that,

Erik Freeman: that that you can now share with a fellow

Erik Freeman: Jim Boyce fan.

Mark Haney: Eric Freeman.

Mark Haney: Jim Boyce, taco, third generation CEO,

Mark Haney: appreciate your leadership in the community

Mark Haney: and your leadership on this issue, so thank

Mark Haney: you.

Erik Freeman: Yeah, thank you very much, Mark, you bet.