Monday, April 13, 2009

Maybe In-N-Out University should be reconsidered

We've hosted several European exchange students over the years, and one of them happened to be visiting us one summer. (Hey, it's California.) We happened to stop at the main In-N-Out Burger joint in Baldwin Park, California. (Not the original one, which is across the freeway and is closed.) It turns out that there is an "In-N-Out University" next to the restaurant, and the student (who was in the process of applying to college) joked that she may need to apply to In-N-Out University instead.

Well, I happened to find a BusinessWeek article that mentioned the university. And guess what? My exchange student wouldn't have qualified for entry.

To attend In-N-Out University, an associate usually had to have worked full-time at a store for a year. In that time, she had to demonstrate initiative, strong decision-making ability, and impressive people skills.

Inasmuch as exchange students are not allowed to work in the United States, my exchange student had to find another school to attend. She will probably do well in her career...but I'm not sure if she'll make as much money as she could in fast food.

Fast food, you say? Minimum wage hell? Not at In-N-Out:

At one point [Rich Snyder] sought the advice of a food industry consultant. The expert told Rich that if he slashed salaries, In-N-Out could save a "ton of money." This infuriated Rich. Recounting the story, he said it was exactly the kind of advice one would expect "from a guy who wears a suit and who thinks you don't pay a guy who cooks hamburgers that much money."

From its start, In-N-Out paid employees more than the going rate. (Associates always made at least $2 to $3 above minimum wage.) As of February 2008, In-N-Out was paying new part-time associates $10 an hour—just 51 cents less than full-time workers at Wal-Mart (WMT), whose $375 billion in annual sales is about 1,000 times greater than In-N-Out's. Store managers at In-N-Out make at least $100,000 a year and are eligible for monthly bonuses tied to store sales.

Rich also established an expansive set of benefits, including 401(k) plans, paid vacation for part-timers, and health, dental, and vision plans for full-time workers.

More about In-N-Out, Rich Snyder, and why some radio stations banned In-N-Out ads here.
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