Pizza Shop Learns Hard Lesson After Thinking 'Fair Wages' Meant Good Business
Dudley Pizza has learned that basic math should always be utilized when planning a business. The Boston pizza place is closing its doors after suffering continued financial losses with their system of paying employees significantly more than normal, and even profit-sharing with said employees. Dudley's is associated by a nonprofit organization Haley House, which has received donations from philanthropists such as Robert Kraft, the New England Patriots owner. In a slap to the face of their ill-advised experiment, three other restaurants that opened nearby around the same time Dudley's did are still in operation, apparently turning a profit.
Unfortunately, this is an instance of a place of business offering to pay salaries far above average, that simply could not operate in the black. Much like fast food restaurants that we have all seen in the news of late paying $15 an hour that are forced to raise their prices to customers or face going out of business, even non-profit businesses feel the same effects.
A manager of Dudley's, Luther Pinckney takes away some positivity by saying the closing of the pizza parlor should not be looked upon as a failure, but more of an experiment that while essentially failing, produced positive results in the form of helping to build skills for its employees and being a part of the gentrification of the local community.
Haley House is known to the local community for helping many homeless and less fortunate people facing struggle since the mid 1960's.
The website for Haley House boasted of another of it's projects, Dudley Dough, saying that it endeavors to challenge the status quo by pioneering a new business model that would empower workers by offering them living wages and profit sharing opportunities to help them overcome economic disadvantages.
Dudley Dough produced a video for promotion that noted their vision is to utilize all of the profit they generated and share it with their workers.
Perhaps they should have done a little more planning before implementation and promotion, because as they are finding out the hard way, not only do you need an actual profit if you intend to share it, but sharing all of your profit is only helping the employees and one's business won't be able to subsist much longer. In the end, you have well paid employees for a very short period, and a business that goes belly-up, and jobless employees not getting paid at all.
Who saw that coming?