Signing the front of a pay cheque

Anyone who's ever run a business understands that it takes a careful eye for detail to be successful. Part of any business's ...

Anyone who’s ever run a business understands that it takes a careful eye for detail to be successful. Part of any business’s success is in large part due to diligence of managing the details; small details that can determine whether the venture is a success or a failure.

The reality of a free market is that without profit, a business will cease to exist. Some of the factors that business owners must take into consideration, are within their control, others however are not. Ensuring that profit margins are maintained will determine the long-term viability of any enterprise. The fine line between success and failure in business, in large part, is controlling your input costs to the best of your ability; costs that are always passed on to the customer.

It was astounding to see Lethbridge East NDP MLA Maria Fitzpatrick suggest that a local pub owner in her town was being selfish because he is considering cutting his staff by 50 per cent and cutting services in the pub, due to the new minimum wage regulations, to avoid passing the additional cost on to his customers.

Of all the tasks that a business owner performs, none is harder or more difficult than being forced to make a choice between closing your doors or having to let staff go. Regrettably, sometimes it’s the only option they have. In the case of the Lethbridge pub owner, a legislated 50 per cent increase to the minimum wage has made for some very tough decisions.

Many Alberta business owners have had to deal with difficult economic times in the last couple of years with slumping energy prices, and the burden of additional costs are not making matters any better. On top of the wage increase, many businesses are looking at the impact the NDP’s carbon tax (effective Jan. 1, 2017) will have on their input costs, these too must be passed on to the consumer.

If you’ve ever signed the front of a pay cheque as opposed to the back, your perspective changes drastically on the importance of controlling input costs. The limits on how much a business can absorb combined with how much the customer can absorb in a slumping economy, is something that is not being taken into consideration by Alberta’s new government.

Plowing ahead in spite of the vocal concerns coming from Alberta business community, will no doubt have profound consequences for a great many businesses already struggling with existing negative market conditions. Government’s role in business is to create an environment that allows markets to thrive, not to create new entries on the cost side of the equation.

MLA Maria Fitzpatrick and her government don’t realize that piling more cost burdens onto employers is not conducive to a sustainable market. Something inevitably will have to give, if a business is unable to manage additional costs. Some will be left with only one alternative; and at the end of the day, bankrupt and closed businesses do not employ anyone. It’s not something you learn in the Legislature; it’s something you can only learn from knowing what it takes to sign the front of a pay cheque.