Colorado restaurants make changes to cope with minimum wage increase

By Jacob Laxen of the Fort Collins Coloradoan. Excerpts:

"At the two Fort Collins Krazy Karl’s Pizza locations that employ about a combined 140 people, the minimum wage increase has costed the pizzeria more than $100,000. Krazy Karl’s pays minimum wage to dishwashers and the tipped minimum wage to its servers, bartenders and delivery drivers.

“We’ve really had to prepare ahead for the changes,” said Krazy Karl’s owner Nate Haas, whose staff has dwindled from about 200 in just over a year's span. “We want everyone’s living wage to be where it needs to be, but we have to be meticulous about keeping labor at about 27 percent of our sales.”"

"“You either have to raise prices on your food or try to do more with less staff,” said Ryan Houdek, who co-owns Fort Collins’ Union, Social and Melting Pot. “You have to become more efficient or see a hit with your bottom line.”

Houdek’s establishments have looked to more efficiently staff its locations.

Similarly, Krazy Karl’s is operating with a leaner staff and has nixed nearly all overtime as a cost saving measure — Colorado law requires employers to pay time-and-a-half for overtime hours.

William Oliver’s halted table-side service at its Lafayette rooftop as a way to staff two fewer employees every night.

Stuft a burger bar — which has Fort Collins, Windsor and Greeley locations — is looking to technology to help bridge the gap.

Stuft co-owner Tiffany Helton said she’s currently testing out tablet ordering systems that would be operated at each table to send a ticket directly to the kitchen. The system would theoretically save enough time that the restaurants could each staff one less server every night.

“I think what you will see is integration of technology into the service model wherever possible,” Helton said.

The California Restaurant Association has said similar minimum wage increases have caused Golden State establishments to add service charges to dinner bills. Data also shows that in regions with the highest minimum wages in California, there’s been a drop in teen and youth employment at restaurants because they cannot offer first-time employment opportunities to relatively untrained youths at such a high cost. 

Some Colorado restaurateurs feel similar trends could come to the Centennial State as a way to combat increasing payroll budgets.

“This is really hard on restaurants,” Colorado Restaurant Association spokesperson Carolyn Livingston said. “They can only raise prices so high before folks will stop coming in.”"