It's a commonly held misconception that businesses must raise prices by the same percentage that wages rise. Wages and benefits are probably around 20% of the

It's a commonly held misconception that businesses must raise prices by the same percentage that wages rise. Wages and benefits are probably around 20% of the cost of running a coffee shop. A simple example P&L: Sales 60000 Rent, COGS 25000 Labor 12000 Op Exp 9000 G&A 5000 Taxes 2000 ---------------- Net Income 7000 So if you take wages up 1.0% to $12,120, you only need to increase revenue by 0.2% to maintain the same net income.