Sipe - Assignment #4

Sipe - Assignment #4 - the business to the employees. The...

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Sipe – Assignment #4 The price of gas has to have the worst long-term effect on the restaurant industry than any other factor. When the price of gas increases, consumers watch what they do and do not make as many trips out because it is too expensive to be running out everyday. If people are not running out as much, they are not eating out as much either. Personally, I do not eat out as much as I did because of the gas prices. My wife and I used to eat out as much as three or four times a week, but now we maybe only go out once. I drive 65 miles to Harrisburg for work so I needed to leave more money available for gas to get there. During a recent conversation with a friend of mine, who is employed by a local Gilligans, he mentioned that business at Gilligans has dropped 9% since last year. I attribute obviously to people not eating out as much. This eventually trickles down from
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Unformatted text preview: the business to the employees. The employees could eventually have their hours reduced or even be left go. One of the lesser factors mentioned of the economic downturn of the restaurant business is health care. I would not offer health care benefits in the restaurant business. Since the industry is known for a high turnover in employment, why offer them benefits? The bad economic times will surely negate the 7% increase from 2007 to 2008 anyways. If I had a choice between the stabilization of gas prices or food prices, I would choose to stabilize the price of gas. In the restaurant business, everything starts with the delivery. Anything you buy, wherever you are, is delivered by someone. The rising price of gas is forcing the delivery companies and trucking companies to also raise their prices. I think the price of food would table off with the stabilization of gas....
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This note was uploaded on 06/05/2011 for the course BUS 123 taught by Professor Professorjames during the Spring '11 term at Central Pennsylvania.

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