« | »

Obama-Care Will Halve Franchisors’ Profits

From the Washington Examiner:

Franchisors warn Obamacare will halve profits

By Paul Bedard | Wednesday Sept 13, 2012

The International Franchise Association held a convention in Washington this week where most of the Radio Shack, Dunkin Donuts, Curves and other franchisers were grumbling about new federal regulations, especially the impact of Obamacare.

Most, said Atlanta Taco Bell and Kentucky Fried Chicken franchiser David Barr, presumed that the reports about how hard Obamacare will hit them were overblown. "They had their head in the sand," he told Secrets.

That is until he pulled out his PowerPoint showing how funding Obamacare will cut his–and likely their–profits in half overnight. With simple math the small business folks understood, he spelled out that their only choice is to slash employee hours so they aren’t eligible for company-paid health care or stop offering insurance and pay the $2,000 per employee fine.

Barr has 23 stores with 421 employees, 109 of whom are full-time. Of those, he provides 30 with health insurance. Barr said he pays 81 percent of their Blue Cross Blue Shield policy, or $4,073 of $5,028 for individuals, more for families, for a total bill of $129,000 a year. Employees pay $995.

Under Obamacare, however, he will have to provide health insurance for all 109 full-time workers, a cost of $444,000, or two and half times more than his current costs. That $315,000 increase is equal to just over half his annual profit, after expenses, or 1.5 percent of sales. As a result, he said, "I’m not paying $444,000."

Providing no insurance would result in a federal fine of $158,000, $29,000 more than he now spends but the lowest cost possible under the Obamacare law. So he now views that as his cap and he’ll either cut worker hours or replace them with machines to get his costs down or dump them on the public health exchange and pay the fine. "Every business has a way to eliminate jobs," he said, "but that’s not good for them or me."

But that’s not all. His experience tells him that most low-wage workers he would have to cover under Obamacare won’t take it because their $995 share is too high, meaning those the program was set up for won’t see any benefit. And those who do will [do so] because they have major health issues, likely resulting in higher premiums to him.

This isn’t news to the regular readers here. We have always known that Obama’s real end game with Obama-Care is to force everyone into the protective arms of the government. To make them dependent so they’ll always vote Democrat.

But it is quite disturbing to hear that the businessmen at this franchisers convention were unaware of what is coming. But, then again, where would they hear about it? From the our mainstream media?

These small businesses had better wake up and smell the coffee before November 6th. Their futures are on the line.

This article was posted by Steve on Friday, September 14th, 2012. Comments are currently closed.

6 Responses to “Obama-Care Will Halve Franchisors’ Profits”

  1. ilzito guacamolito says:

    Obamacare has never been about insuring the uninsured. It has always been about a foot in the door to a universal, government run health care system.

  2. Right of the People says:

    Obama complains about the “Cadillac” health care plans that a lot of businesses have but if you read what his health care is supposed to provide in comparison it is a Roll Royce health care plan. Ilzito you are correct, he want the NHS over here so we can have accountant and other bean counters decide who lives and dies.

    What is discouraging me is Romney’s retreat since the convention. I just saw one of his new commercials, it was bland and uninspiring. He needs to be slamming the Ohole over Libya and Egypt instead of making his lame and weak comments. All he has to do is tell the truth, that will inflame the people enough.

    • ilzito guacamolito says:

      Right, Right.
      As for Romney, as I have said, the gloves must come off. Nothing is off limits, bcz they stop at nothing plus they have a complicit MSM. The O’s record is enough fodder for any campaign, not to mention the deadly fiasco of the past few days. These leftists have no morals, scruples or shame. They must we dealt with as one would a most deadly enemy, bcz they will not stop and will wait us out.
      Damn the torpedoes…

  3. Chrispbass says:

    OHole….nice :D

    They will be hammering on RR’s ‘lack of foreign policy’, RR need to HAMMER on ‘Egypt is / is not our ally’. That was not misspoken. Read it in context.

  4. canary says:

    Every American employee is going to be required to pay an estimated $500 dollars a month for Obama Care and I just wonder the specifics of those that can’t afford it in working with the IRS who will be running the program.

  5. Anonymoose says:

    “Obamacare” is just a health insurance mandate and nothing else, to make sure everyone has insurance to supposedly keep from being a drain on the system. A lot of people will lose insurance as employers decide it’s simpler to pay the $2,000 shakedown—I mean, fine–than pay insurance on an employee. And that’s AFTER ever more people are reclassified to temporary, part time, or contract work to get out of paying insurance.

    And not fully taking effect until 2014–second half of Obama’s planned second term, after the congressional mid-terms–isn’t that obvious?

    I’m losing hope in Romney–not that I had much to begin with. Obama has done so ing much that could be run through the wringer, the media will hate him anyways so why play nice?

    Instead we’re getting the same old retread of Dole/McCain/Bush–play moderate, don’t overdo it, assume the people will clue in. Meanwhile the media portrays Romney as the same radical extremist that was elected in 2008. And the people believe it! What is it–anything the liberal leaders say they swallow without question!

    The Republican party is smaller, weaker, and less funded than the Democrats, and is a rambling shell of what it once was. There’s no fight or vigor left, only reaction to whatever the Democrats do, while they keep portraying themselves as freedom fighters against an evil right wing empire. When will the madness end?

« Front Page | To Top
« | »