
In-N-Out managers earn triple the industry average - ohjeez
https://medium.californiasun.co/in-n-out-store-managers-earn-160000-wages-b08fe6f1706f
======
ucaetano
I once did a quick "anthropological" study with In-N-Out employees (read:
fancyspeak for sitting down and talking to them about their job), I was quite
surprised.

Most of them were very happy with their jobs, not just happy with pay and
benefits and so on, but happy to work there. They found it a very welcoming
and friendly work environment, where people were rewarded for initiative and
trying to improve things.

Most of them didn't see themselves leaving the company any time soon, unless
it was for a different job type (such as moving to an office job after
finishing school).

It was a very good lesson on how job satisfaction doesn't need fancy cafés,
ball pits and slides.

PS: Those were just my impressions from talking to a limited number of
employees. Endless numbers of caveats apply.

~~~
e40
I've never done that, but it was clear from observation that it was true.
Here's what amazes me, that people like Bezos exist. I mean, treating people
that work at Amazon (especially the warehouses!) like the employees of I-N-O,
Amazon could be an even more valuable company. Instead of being an employer of
last resort (I would take any job before I worked there), they could be the
"it" place to work. Instead, Bezos allows people to be treated like complete
shit.

~~~
csallen
I just finished reading _The Everything Store_ a few weeks ago, an eye-opening
book that deep dives into the history of both Amazon and Bezos. I don't think
there's any chance that Bezos and crew haven't done the math on this part of
their business. They have an extremely detailed understanding of what makes
Amazon tick, and cutting costs is an absolutely crucial part of that equation.

Ethically, I agree with you. They shouldn't treat their employees like shit.
Some things are worth more than money.

But financially, it's 100% untrue that Amazon would be more valuable if they
focused on employee happiness over cutting costs. It's not an accident that
Amazon generates more revenue than any other Internet company in existence.

~~~
coldtea
> _But financially, it 's 100% untrue that Amazon would be more valuable if
> they focused on employee happiness over cutting costs. It's not an accident
> that Amazon generates more revenue than any other Internet company in
> existence._

Or it very well could be (an accident). Survivorship bias and all...

~~~
csallen
That's a possibility, yes, but I think Amazon's success is too extreme a case
for an accident to be the most likely explanation. If it was merely a "decent"
success or a "pretty good" success, then yeah, but it's many orders of
magnitude beyond that, in a very cutthroat industry. To get to this point, the
company has had to consistently make aggressive, unintuitive, massively
beneficial decisions, many dozens of times per year over several decades.

Imagine Lebron James — Could he just be lucky every play he goes out onto the
court? It's possible. But I'd say the more likely explanation is he knows what
he's doing. He's got a fundamental understanding, an underlying theory, and a
set of skills that map well to reality and give him an edge that contributes
to his success. So does Amazon.

------
mc32
That they can pay hourlies (as well as the highlighted managers) well above
industry average and still manage to make a profit undercuts the argument that
companies in the service industry need _cheap_ labor to survive.

It's the companies who want to milk dry the American worker who cry wolf at
the thought of having to pay Americans a decent wage. There are millions of
people who have left the labor force because their wages have been undercut.

I think there is a significant pool of willing workers willing to work for the
right wages --they may need some assistance in getting back to being
productive workers, but I think industry owes them that after decades of
neoliberal policies outsourcing and shipping jobs overseas.

~~~
danielrhodes
Usually you hear the “we need to pay our workers low wages” from companies
that have very low margin unit economics. McDonald’s for example has a high
number of cheap products. Same with Wal-Mart. They need a lot of people to
service all the offerings they have. In-n-out has like 5 things on the menu,
so they probably need far fewer employees overall. Costco is another example:
they carry very few products compared to Walmart and thus need far fewer
employees. Guess which companies offer their employees lots of benefits?

~~~
azernik
McDonald's is actually a very bad example; they're famous in the industry for
their ridiculously high margins, on the order of 15-20% rather than the medium
single digits for most fast food chains.

~~~
greedo
Most McD franchises would kill for 15-20% "margins" depending on how you
measure that. At the end of the day, a franchisee usually sees a 10% margin
after controllable expenses, and before any taxes.

~~~
GFischer
Which is still pretty good :) . From what I know, stores in popular areas have
surprisingly big revenues, I'd love 10% of that (my brother used to work at a
store with a million dollars in monthly revenue).

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no_wizard
I personally believe this has much to do with with two things.

1) In-n-out is not public. At all. So they don’t have to answer to the
pressure of Wall Street and it’s sharks or get a huge stake taken by a hedge
fund or Any of those other external pressures of that nature.

2) they’re still majority family owned and the guy who founded it reallly
believed in taking great care of his workers

~~~
bedhead
I have a slight quibble with the first point, though I generally agree. There
are public companies out there that simply don't care about Wall St, and are
run like they're private. It requires an admittedly rare combination of
founder controlled/involved, no need to raise capital, strong business model,
and unique culture. Think about Amazon, who have given the capital markets the
biggest middle finger of all time, refusing to show a single dollar of profit
because they believe the reinvestment opportunities are too great (I would
strongly agree).

There's an agricultural company called Seaboard Corp that's public. Its's a $5
billion market cap company controlled by the founding family. There are no
analysts covering it, they've never once held a conference call, they don't
give guidance, etc. The stock is near its all-time high and has returned a
staggering 22% annually since 2000. Sure, these are rare, but the market is
pretty efficient about this stuff over time.

So it's possible, and I bet it would be possible for In-N-Out as well. But it
would probably still be viewed as a hassle, and if no one in the family needs
liquidity to buy a super-yacht, or pay a massive divorce settlement, or buy an
NBA team, there's no point.

~~~
w0m
Amazon is an interesting example. Yes, they grossly reinvest rather than pay
dividends, but they don't invest in employee pay/compensation directly
('wastes' as per common view of what wall street wants)

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phasetransition
Chik Fil A owner operators also comfortably in this realm of income. Both
companies get a lot of the same things right for customer and employees.

P.S. If you get put down as a reference for a potential hire at Chik Fil A
corporate, don't be surprised to find yourself in a 45+ minute discussion
about the hire. They take vetting seriously.

~~~
bpicolo
I don't think comparing franchise ownership with managers is a particularly
fair place yeah? You have to put like a million in capital down at a minimum
to open something like a chick fil a.

~~~
seanalltogether
Chick-fil-a famously requires $10,000 to become a franchise "operator", but
they require a heavy investment in time and energy and can be revoked at will.
I think it's more appropriate to compare a chick-fil-a operator with an in-
and-out manager, than it is to compare them to a mcd franchise owner.

~~~
phasetransition
About a decade ago a friend applied to become an owner-operator at Chik Fil A.
He had years of experience managing multiple car washes, and a letter of
recommendation from someone at corporate.

He made it from the initial multiple thousands of applicants to the second
round of 500. Corporate told him to go work for 12+ months behind the counter
in a Chik Fil A and then re-apply.

They had you rank your store location choices, and you moved where they told
you to, if you were selected. I forget how many stores they were going to open
a year, but I want to say it was around 100 back then.

------
ainiriand
Here is the key: 'In-N-Out has no public shareholders'. Stay away from Wall
Street sharks and the urge to give increasingly bigger profits every year
vanishes.

------
bluthru
>A typical architect in California earns about $112,000 a year, according to
the jobs site Indeed.

That's because software architects are wrapped up with building architects on
Indeed. Building architects make much less:
[https://www.glassdoor.com/Salaries/architect-salary-
SRCH_KO0...](https://www.glassdoor.com/Salaries/architect-salary-
SRCH_KO0,9.htm)

(Which is partially why I left.)

~~~
asr
The salary comparisons are also hurt by the fact that "architect" and "lawyer"
are titles you have your entire career, while "restaurant manager" is a title
only one person in the restaurant has.

If you compared the salary of an in-n-out manager to the engineer running the
team, or to law firm partners, you'd get a different conclusion.

The fact that someone who's worked for a good chunk of their life at an In-N-
Out makes more than a young professional fresh out of school seems pretty
reasonable, when you think about it. (Although it still makes In-N-Out an
exception, which is too bad.)

~~~
aphextron
>The fact that someone who's worked for a good chunk of their life at an In-N-
Out makes more than a young professional fresh out of school seems pretty
reasonable, when you think about it. (Although it still makes In-N-Out an
exception, which is too bad.)

With almost certainly far more hours worked to make that salary, as well. Most
fast food managers are spending 60+ hours/week in the store, opening early and
closing late at night. All to make a _decent_ living wage in California. I
would not envy that life one bit.

------
dpeck
They’re run head and shoulders above every other fast food restaurant, maybe
the secret is paying employees enough to make that happen?

edit: changed management to employees to capture more generally.

~~~
BinaryIdiot
Agreed. They are my least favorite burgers and fries but the service is
absolutely incredible. Every single person I have EVER dealt with is very
professional and polite. I have never seen another restaurant with employees
like that.

It's often compared to Five Guys but the vast majority of Five Guys I've been
in have employees that don't really seem to care.

~~~
brandall10
Five Guys isn't fast food in the traditional sense - a basic
cheeseburger/fries/drink is over $15 out here in southern California, whereas
the same at In-N-Out is $6.

But in that market we do have Burger Lounge which goes well beyond In-N-Out's
service level. We also have Luna Grill for Mediterranean, similar excellence
in service and quality of food.

~~~
dubyah
In-N-Out is fast food. Five Guys and all the other restaurants you've
mentioned fall under fast casual.

~~~
dawnerd
I’ve never had a fast trip to an In-N-Out. Lines are always really long.
Quality of their food has gone down hill over the years as they’ve tried to
keep up. While it’s not even close to my fave I’d still shove an animal double
double down my face so fast...

~~~
bpicolo
In the Bay Area, at least, the quality is always the thing I've been most
impressed with. The burgers are picture-perfect (like, could be in an
advertising photo) every time, and the food is good.

I haven't had such consistent high quality of anything at any other chain.

~~~
dawnerd
> The burgers are picture-perfect

Yep definitely going to different In-N-Outs.

------
callumprentice
Another business that had well paid store managers is Trader Joe’s - I believe
they also make something towards $160K in total comp. Also a place filled with
happy, helpful people.

Almost like there is a connection between a good package and happy employees.

------
jxramos
This is accurate, my old childhood buddy worked through In-N-Out for something
like 7 or 8 years before and through college told me several years ago that
managers make great cash and the whole In-N-Out ecosystem is really top notch
in their employee dynamics.

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xbeta
> If other fast food establishments have been reluctant to raise wages,
> Jayaraman added, it’s because pressure from investors has elevated quarterly
> gains above the potential long-term benefits of happy workers. In-N-Out has
> no public shareholders.

Well, that's a reason why I think lots of startups these days opt for a much
later public offering. Public investors are just very short-sighted on making
a smart financial investment decision. Can't blame them, we are all been told
using number (or some measurable metrics) to evaluate any businesses without
even understanding what does the business do.

~~~
chii
> using number (or some measurable metrics) to evaluate any businesses without
> even understanding what does the business do.

if those metrics are any good, why won't those metrics be higher for those
companies that put long term gains (e.g., happy workforce) a priority? Those
metrics that show good numbers for short term gains are bad metrics, and the
shareholders who like them are likely to want to cash out before the 'long
term' hits, and therefore, use those metrics to justify their decisions.

~~~
xbeta
Unless there's an agreed methodology on how to measure that "happiness" in the
workforce with good science backing it, then sure. But for so many years, I
think human never reach that consensus.

~~~
chii
i would've thought the most obvious, and most agree-able method is to simply
ask the yes/no question- 'are you happy at this job?'.

~~~
xbeta
Sure, but I don't think human is very good at judging his/her own emotion on a
simple yes/no question on happiness. :-)

------
jitix
I think the interesting point here is that the company is private and doesn't
have to maximize short term profits for shareholder gains.

From my own experience I've seen that a private/bootstrapped company has much
more flexibility to think long term (and that usually means keeping employees
happy) than a public company.

On the other hand the stock market drives a lot of important things like
pension funds, mutual funds, etc. Maybe we can strike a balance and trade
shares based on their long term dividend potential.

~~~
hueving
AMZN is entirely focused on long term gains and reinvesting money and the
stock is killing it.

Being publicly traded != making short term decisions.

------
Larrikin
What I found interesting in Japan, was it seems like employees working in the
larger fast food chains had a pretty much guaranteed track to the corporate
office if they were willing to put in the time working at the store and had
credentials to match. Usually the employees are part time with no desire to
climb up, but I met few people who worked at McDs or KFC during college and
had a job offer or atleast an interview waiting at the end of it in the
corporate office.

One guy I talked to was told that he had to put in a full year to be
considered for interviews in the next graduating class, so he worked at McDs
after college so he could interview the next year.

Do the chains in the US offer similar tracks? Does experience at the chain
translate well to getting hired in the corporate offices? Seems like an easy
way incentivize college students and graduates to work at a chain and actually
take it seriously. I worked at a McDs as my first job, years ago and I still
see a lot of the same faces when I go back home. Even when I was there one of
the managers was complaining that after 10 years she was told she couldn't get
her normal yearly raise because she was "making too much money already"
according to the owner. Corporate could and should pay for/partially pay for
college for managers without an education as a perk for high performers.

------
Judgmentality
I realize this is the exception and not the rule, but it's great to see that
fast food chains can make incredible profits while paying their employees
significantly more than the competition. There are so many restaurateurs and
investors claiming it's impossible for the fast food industry to survive the
$15 minimum wage hike, but I suspect it will just make this already cut-throat
space even more prone to failure.

~~~
hueving
In-N-Out truly seems to be in a league of its own. The one I frequented in
Mountain View would consistently have a line through off hours. I would show
up midnight and still have to wait.

Meanwhile, the Jack in the Box just down the street usually had about 3 cars
in the lot, one for each employee.

It's very possible that $15/hr could kill a lot of less popular fast food
restaurants, particularly in more isolated areas.

~~~
briandear
The market at work! Make a shit product and get driven out of the market or be
forced to up to game.

Ultimately that means better pay and better products. (Since the two go hand
in hand when it comes to service-driven businesses — In and Out is a case in
point.)

~~~
mschuster91
> Make a shit product and get driven out of the market or be forced to up to
> game.

The problem is when you have a fastfood restaurant in a run down part of the
town where people may have money for a $1 cheeseburger but not for a $2
cheeseburger.

------
gpapilion
This is not an atypical salary for yum brands managers in the Bay Area. I
wonder how much of this is being a primarily California chain.

~~~
gebeeson
I've thought this as well - location might play into all of this as well. I
live in a relatively small county in southeast Georgia and all of the fast
food joints here start great but end up abysmal simply due to the caliber of
people that are working there. Pay? Location? Manager? Over all framework with
all of the above applied as cause? Not sure. Recently several places here
(Waffle House and Burger King) are super short staffed because they simply
cannot find anyone to fill the positions with the pay advertised. That kind of
thing here is becoming more of a problem.

------
baby
My 2 cents:

1\. in-n-out is amazing. It is my favorite mcdonalds-type burger. It's simple
(only one burger on the menu, with or without cheese), it's fresh and it's
cheap. In addition, employees are always nice to you. I wish it was in Europe.

2\. I worked at McDonald in France, got minimum wage. I got out quickly but
some friends stayed for quite a long time (3 years). The main reason is
because they promote you quickly. Everybody hates the job (unless you're
staying for a few months only, then it's fun) but everybody gets trapped by
the constant promotion system. The trick is that promotions don't necessarily
increase your salary, or if they do then it's peanuts. Even the director of my
restaurant (not a franchise) was paid peanuts.

3\. Working in a fast food can be fun! people don't expect that, but I always
recommend people to try it. There is definitely a pleasure in manual labor, an
instant gratification that you don't necessarily get in intellectual-type
jobs.

------
mrarjen
Welcome to the world where we talk about the company giving their employees a
proper salary and benefits, because every other company of it's kind is
unlikely to do so. Let's hope more companies follow eventually.

I heard good things of In-N-Out and ill likely visit one one day when I'm ever
back in the states.

~~~
hueving
What is a 'proper' salary?

Also, the very reason this is news is because it's 3x the average. If all of
the restaurants paid the same it would just be the average and not worth an
article.

~~~
mrarjen
A proper salary is one where the workers can live their lives without worries
about money or having to work multiple jobs to make ends meet.

And 3 times the average for this kind of work in a place where 2 times the
amount is the normal average is kind of crazy. And this should indeed not be
an article to begin with but it is.

~~~
hueving
>A proper salary is one where the workers can live their lives without worries
about money or having to work multiple jobs to make ends meet.

That's lacking enough concrete details to be meaningful. It seems to be 'more
than they'll ever need' to meet the criteria of not needing to worry about
money.

Do you think one of these managers could live in San Francisco without
worrying about money?

20k/annum is enough for someone who owns a house and lives in a low COL area
to not worry about money. (one of my friends lives like that and appears to be
happier than I)

300k/annum is not enough for a family of 4 living next to Central Park in NYC.

There is no way to decide that people are making a living wage without a
centralized definition of living, which most people will disagree with.

~~~
mrarjen
I do think one of these managers could live in certain area's in SF without
much worries.

But I agree if you will live in a 30 million mansion with a view over the
city, you won't have enough as a manager.

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joe5150
Though the In-N-Out where I live has seemed at times understaffed, most of the
employees who work there have been there at least as long as I've lived here
(over five years now), which has to be anomalous in fast food.

~~~
ohjeez
I suppose it helps that they're paid a living wage!

~~~
joe5150
I would wager that's the biggest single factor

~~~
exabrial
+1 for the pun

------
scelerat
I've been eating at In N Out since the '70s (store #3 is a block from my high
school, the same alma mater as the founders) and the consistency is amazing.
It's been pretty much the same great recipe, as far as I can tell, the whole
time. The fries changed some time in the '90s; they used to be more limp and
greasy than they are now.

I had friends who worked there and they made a great hourly wage (at the time
I think I remember 200% minimum for a non-manager) and they really liked it.
It was a tough and coveted job for a high schooler or someone in jr college.

------
whoisjuan
Hmmm. Is this true? Seems like the ideal way to get a disgruntled front
line... You're in a service industry, making 30k a year - 15/hour as a cashier
(regardless if you're getting any extra benefits) and your direct superior
makes 160k?

I don't know, but I can't imagine a scenario where people don't get pissed-off
with such a massive difference for two jobs that are performed on the same
location, imply interactions with the same people and are only one command-
chain level apart.

~~~
jsloss
Store managers most likely aren’t the front line’s direct supervisor. And the
gap between roles as far as responsibility would be high. I would expect very
high standards and tough to reach goals would make being a store manager a
challenging role to succeed at.

------
habosa
I always notice there are a TON of people working at every In N Out. Like
maybe 10 people behind the counter versus 3 at a McDonalds.

Anyone know what's up with that?

~~~
toast0
McDonald's has been investing in labor saving (including automation). A robot
pours the drinks for the drive thru, they've got the combo ketchup and mustard
things; and a lot of the food is prepped off-site. In-N-Out tends to be higher
volume than the MacDonald's around me; but they also are cutting potatoes just
in time, and hand assembling burgers.

~~~
dawnerd
I wouldn’t exactly call what McDonald’s has a robot. It’s just a button that
turns off the street after so long. Been using them for at least 10 years now
too.

But I get what you’re saying. They just updated the McDonald’s near me to be
primarily touch screen ordering yet somehow they still take forever to
essentially assemble pre cooked food. I don’t get it...

~~~
toast0
They've got new robots since last year ish; it pulls a cup, puts in ice, and
fills with soda. Here's a video:
[https://m.youtube.com/watch?v=akv4vSXa5a4](https://m.youtube.com/watch?v=akv4vSXa5a4)
In this video, a human is waiting around for it, but what I've seen as a
customer is the machine usually runs unsupervised while the drive thru person
chases after the food orders.

------
jacobkg
Does anyone know if they hire store managers from outside or whether they have
to rise up through the ranks?

~~~
natecavanaugh
I can't say for sure, but I would strongly imagine that they would want any
managers they hire to be intimately familiar with the culture. So I could see
that even if they did hire externally, the applicant would need to train
through one or a few different jobs and become acclimated with their way of
doing things.

But I'm seriously only guessing from what I've seen of companies with really
strong company cultures.

------
jedberg
My understanding from folks who work there is that it's basically impossible
to get a job there unless you know someone who already works there and can
vouch for you.

As in, they won't even interview you without a recommendation from a current
employee.

I guess this helps them maintain quality hires.

