Thread by @mangiotto

As a retail manager, there are only two things that you can really control in terms of profit/loss. Utilities are largely set, opening costs, depreciation, marketing, executive salaries, rent... all that's more or less fixed. Shrinkage is negligible, external theft? a pittance.

The things you can manage are Cost of Goods and Labor. COGs aren't how much the market dictates they cost - you can't control that, either - but rather your inventory. If you run a restaurant, are you ordering enough food but to serve, but not too much food so that it rots.

There are other things that go into those costs, of course, but gas for delivery, refrigeration and upkeep, all that stuff is not really up to you and switching suppliers can impact product. Anyway - COGs is one thing and then Labor. Labor is the big one. So in a restaurant,

your food COGs are usually something like 25% or so. Sometimes more, sometimes less, but you're working in there for the most part. That means for every $1 you bring in $.25 of it pays for the food you sold. If you have a bar, good news, that's usually only 18%. Booze has good

margins. Labor - you're shooting generally for another 25% maybe. If you're being generous. So between what you're selling and what you're paying people, that's half your money. You're down to $.50 of that $1.00 you brought in. But how about rent and water and all that stuff?

Yes, you're right - your profit now is looking very slim. You may be clearing like $.10 out of every $1.00 you bring in after everything and that's just not enough so what do you do? Well, you shave down what you order to the point where you start to run out of stuff sometimes.

Or maybe you start to get the cheaper version of whatever - sometimes frozen maybe so it lasts longer than 5 days. It gets harder to predict business, too, because pandemic and people out of work and all that so maybe you run out of wings during peak on a Wednesday and then if

you stop ordering some stuff, well other people stop ordering it, too, and either the costs go up because the demand has gone to shit or the production companies just stop making it. Hello Starbucks iced green tea for a while. But labor... well, with labor you can do all sorts of

terrible things. First you freeze hiring. No new people. And who can afford the extra hours training any new people you do hire? No one has that budget. Then you freeze promotions. So those bright eyed kids who do care about your business and want more responsibility? Welp, you

can have the responsibility, but you won't get paid for them. Haha, you. Also, you won't get raises. Or bonuses. Don't be stupid, the world is hard, don't you see? Oh, this bonus I got for treating you this way? I earned it for keeping labor down. I'll also be short-scheduling

you all so your shifts are harder and your guests are angrier and you're going to have to deal with that. You're front-facing in customer service, you know what you signed up for. Go tell them why it took thirty minutes for them to be told we're out of what they want. Oh -and

you're about to get a lot of hours you can't work because of your second job but I wonder if you're really dedicated to this job like you say you are when you don't prioritize it over your life and your rent and stuff. Also, I won't be giving you enough hours for you to qualify

as a "full-time" worker and thus be eligible for our terrible benefits package. You need to average 20hr for the quarter, you say? Oh, no, you only have 19hrs this quarter. Better luck in three months. Also, no Over-Time without permission that I will never grant to you. OT is

too expensive and not only will you get disciplined, I will also be disciplined. The thing to remember with retail is that it's all a pyramid scheme. There is one person getting rich here and everyone else is compromising themselves to help them in exchange for all of their life.

By the way , everything is broken and there's no money in the budget this month to fix it. You're even out of printer ink for your schedules for a system that is out of date and doesn't work and also your cash registers run by Apple go down whenever it's busy. Deal with it.

And suddenly, people are declining to deal with it. In case you're wondering why people are having trouble hiring and there are a lot of strikes going on.

What I'm saying is that every level above entry level is engineered to exploit the entry level. And that these jobs were always, always horrific but now there's the open understanding that their lives mean nothing. They are WWI doughboys going over the trench. A number. Revolt.

I should spell it out by saying that every % you squeeze out of people is an extra % you pocket. Get that 25% labor target down to 20%? That's huge. If you're in the service industry, ask your boss what their labor target is. You might be as surprised what they tell you.

Oh - last thought - business dictates this of course. The more you bring in, the larger number that % represents. You can staff more when it's busy but when it's busy is also when you can "afford" to staff less. You can't cut the only person working, but you can cut one out of 5?

But then your service goes down, and quality, too, and all the other things including burnout rise... it's the only thing preventing your boss from scheduling one person all the time. That guardrail, though, is gone now because you can just say "pandemic!" and shrug sadly.

Okay, I have 3 people on when metrics show I should be scheduling 7 but... well, unemployment and vaccines and pandemic business trend volatility and, sad shrug, man, that's just how it is right now. Thanks for coming in on your day off. Punch out before you hit OT. And guests?

Early part of this, the worst humans on the planet only continued to demand eating out and full service. They broke jaws, screamed, refused to wear masks and so these kids on the frontlines who we're already abusing to literal death, are forced to try to enforce state mandates.

Now, most are back to going out to eat - a lot more anyway, and they are not happy about the service and the new wait times and all of this and if you complain, sad shrug, Pandemic. It's a self-replicating cycle. But you know what? If you were to pay people what they were worth

and treat them like human beings... it's really extraordinarily simple. But that requires empathy and emotional work and investment in your staff. It's easier to just squeeze that number and blame the circumstances for how you blew your PPE loan and why you're closing now.

You may work for a chain and wonder what District Managers do? There are exceptions, but generally speaking, they don't do fucking anything. District managers look over a spreadsheet of their stores once a week and target stores that are not hitting their "metrics" in terms of

say it with me now: COGs and Labor. Then they go into the store to make sure that the targets are hit for the good of not the individuals working there, but for the corporate beast that wants its 1%. What do their bosses, the Regional Directors do? They do what DMs do but when

they look at their spreadsheets, it's not of stores, it's of District Managers. Regional Vice Presidents? Yes, same, but with Regional Directors. Let me also share that the higher up you go, the more the people who hold these positions are sociopaths. Why? Because what kind of

animal wants to control 2000 people according to the amount of labor you can squeeze out of them without, but just without, killing them? Ask your DM how much of their check they put away for a rainy day. Or how much they bonus if they hit their COGs and Labor metrics. Now, ask

yourself if your 9yr old child knows if one number is higher than another number and how to tell someone else that the higher number needs to be lower. And consider who you are when every decrease of a certain number means an increase in pain for someone you know.

It doesn't have to be this way, but it is this way. Capitalism is the Stanford Prison Experiment. If we decline to participate, it will have to change. That's why I support unions. I was a Teamster for years. It's why I support labor action. We have ZERO power alone. Resist.