Corporatism, Detroit, Michigan — September 12, 2013 at 7:17 am

Detroit fast food joint Moo Cluck Moo pays a living wage of $15/hour – and makes a profit!


Doing well by doing good

This story refutes absolutely everything corporatists and companies whose business model requires the lowest labor costs possible want you to believe. According to them, there is no way fast food joints can succeed, turn a profit, and grow if they are forced to pay their workers a living wage. “Nobody will pay for burgers that cost a few cents more!” they cry. “These unskilled workers don’t deserve to be paid more!” they tell us.

Detroit-based Moo Cluck Moo is disproving that every single day. Here’s their story (from a terrific piece at The Daily Beast):

In August, I spoke with the owners of Moo Cluck Moo, a Detroit-area burger and chicken fast-food joint that is aiming to do something revolutionary: pay far more than the minimum wage. In an industry that treats labor as a commodity, co-owners Brian Parker and Harry Moorhouse decided to turn the conventional wisdom on its head. They’d start workers at $12 an hour, and design their business so that it could run profitably at those wages. Rather than take advantage of the epic slack in the Detroit-area labor market, they’d aim to set a slightly higher standard. […]

Now, Moo Cluck Moo is doubling down on its high-wage strategy. Brian Parker says that beginning October 1, the company will start employees at $15 an hour. That’s a 25 percent increase from $12, and it represents the living wage level that workers are demanding and that many critics regard as foolish. […]

First, he believes his employees deserve it. Working at a quick-service restaurant is a difficult, demanding job. People have to multi-task. They’re coping with long lines and expectations of rapid service. These are the people who take care of the customers, and this is a competitive business in which customer service matters a great deal. “It’s not an easy job to do,” said Parker. “We’ve got a line out the door.”

And while Moo Cluck Moo has only been in business since the spring, Parker believes higher wages lead to better results. “We’ve had very low turnover,” said Parker. “Of the people that are working for us, we don’t have anybody disgruntled.” Over the weekend, three customers came up to Parker, without prompting, and thanked him for the quality of the customer service. Paying people more means you spend less time firing, hiring, and training. And Parker and Moorhouse would prefer to spend their time thinking about the business than supervising employees. “If I have to babysit these people, I’m a high priced baby-sitter.”

See how that works? You pay people a fair wage, treat them with dignity, and you get loyal employees that will go the extra distance to treat your customers well and make sure they get the service they want. The customers then come back. They tell their friends. Your business grows (Moo Cluck Moo is planning to expand soon, by the way) and you make money.

It’s not that difficult but all the B-school geniuses running the corporate world can’t seem to get their minds around it. Rather than seeing paying people a living wage as an investment that’s every bit as important as marketing or product development research or high-salary CEOs, they see it as a foolhardy waste of money on people who don’t deserve it and are a dime a dozen. If someone doesn’t like their paltry paycheck, they can hit the road, Jack, because there is a Jill in line right behind them salivating for a job, any job. At any pay.

Somehow they missed out on the calculus of human resource management that puts a price tag — a not-insignificant price tag, mind you — on the costs of turnover. It costs money to hire and train new people and those costs aren’t always obvious. And that doesn’t take into account the lost business resulting from crappy service from disgruntled employees who are treated like the disposable utensils they put in your Burger Whop bag.

Kudos to Brian Parker and Harry Moorhouse for both figuring it out and for being good human beings. If you’re in the Detroit area and have a hankering for a burger or a chicken sandwich and some fries and a shake, why not choose them over their worker-exploiting competitors? Let’s reward them for being good and decent and clever like a fox.

You can find them at 8606 N. Telegraph Road in Dearborn Heights.

You can also like them on Facebook HERE.

[CC Hell Yeah sign image by eclecticlibrarian \ Flickr]