In so doing, Dudley Dough is providing us free of charge with a delicious example of how socialism can’t work, no matter how you try to spin it. I’m not an economist, or a business expert, but after a brief analysis even I can tell why this business failed. Here are my tasty takeaways:
1. Profit is essential to business
For a business to survive, it must make money. Customers are the source of a business’ money, therefore the customer must be the business’s top priority. Otherwise the business has no reason to exist. Let’s see if Dudley Dough put their customers first. Here is their self-described mission:
Dudley Dough seeks to challenge this status quo by pioneering a new model of worker empowerment in the restaurant industry, offering living wages and profit-sharing opportunities to help our workers overcome the economic disadvantages that are an unfortunate part of the current reality.
Nowhere in this statement is the customer even mentioned. In fact, a text search of Dudley Dough’s website returns zero results for “customer” or “consumer.” This is clearly not a customer-focused business. The above statement is focused entirely on the employees.
Employees are certainly important, and a business cannot survive without them, but where does the employees’ money originate? That’s right, the customer. The company cannot provide an employee with “living wages” if it first doesn’t receive money from the customer, which brings me to my next point:
2. A business must produce something the customer wants
This seems simple enough. If a customer doesn’t want a business’ product, they will not purchase it. As far as I can tell, very few people wanted what Dudley Dough had to offer. Check out the reviews on Yelp. After two years in business, Dudley Dough only garnered 26 reviews and not all of them were positive. Now take a look at the customer images. In my humble opinion, those pizzas look like warmed over barf on a plate.
Next, let’s take a look at the menu. Scroll past the social justice jargon down to where the pizza is actually listed. Shrimp and corn with puttanesca? Yum. Mashed potato, meatloaf with corn, capers, and béchamel? Oh boy! Curried vegetable with lentils? These are pizzas? I don’t know many pizza consumers who are clamoring for a jerk chicken, sweet potato, and jack cheese pizza. Especially at $12.50/pizza.
As a side note, I like how the menu has to point out that ½ + ½ = 1. Thanks. Math is hard I guess. Maybe that’s why Dudley Dough struggled with my next point:
3. Math is Hard
The starting hourly wage at Dudley Dough is $12.50. I’m not a rocket surgeon, but I do believe that $12.50 is also what the menu listed as the cost of a full-size 14” pizza. That means that in order to break even, Dudley Dough would have to sell at least one pizza per hour for the total number of employees working there at any given time. And that doesn’t include any other costs besides labor.
Dudley Dough reportedly started with nine employees, including the manager. Their operating hours are listed as 7:00 am – 9:00 pm Monday-Friday and 11:00am – 9:00 pm Saturday. So they’re open 80 hours per week and they pay their employees $12.50/hour. Assuming a minimum of one employee on-shift at a time, how many 14” pizzas does Dudley Dough need to sell each week in order to break even on labor costs? Show your work.
(80 hours) X ($12.50/hour) = 1,000 / ($12.50/pizza) = 80
80 warmed over barf pizzas per week. I’m guessing they didn’t meet that quota. Which brings me to my next point:
4. Socialist programs depend upon other peoples’ money to survive
Dudley Dough is no exception. They were supported all along by the Haley House, a Boston area nonprofit organization. The Boston Globe, in its account, even used the word “subsidize.”
But after an analysis of the business’s operations and trends, the board determined that Haley House could not continue to subsidize the pizza shop without putting in peril its own efforts.
Subsidize. That’s a key word. Merriam-Webster defines subsidize as “to aid or promote with public money.” I don’t know if Dudley Dough was the recipient of public money, but it’s clear that they were not able to operate as a business without outside help. They even received a $100,000 donation from Robert Kraft and still couldn’t make it work!
If a business cannot provide customers with a product they want to purchase, turn a profit, and stand without outside help, then it has—quite simply—failed.
And this brings me to my final point:
5. Socialists are delusional
Dudley Dough has failed as a business.
‘I don’t think anyone is looking at it as a failure,’ said Luther Pinckney, a team leader at Dudley Dough, which is in the Bruce C. Bolling Municipal Building. ‘It’s an experiment, and some very good things came out of that, such as skill-building for staff and being in this building at this time of gentrification and change in this community.’
All of the skill-building and gentrification in the world isn’t going to revive a flawed business. Other pizza places are operating in Dudley Dough’s neighborhood and they haven’t failed. Dudley Dough is clearly a failure.
It’s done. It’s over. It has ceased to be. It is an ex-business. It is a failure. Dudley Dough is a Dudley dud.
By their own words, Dudley Dough was an “experiment” in economic justice. If socialists were capable of learning from past such experiments, they wouldn’t need to waste time and effort re-experimenting with failed ideas over and over again. Socialism just doesn’t work, it never has, and it never will. Socialists simply aren’t willing to learn that truth.
I will leave you today with this juicy bit of dessert from one of Dudley Dough’s employees:
‘I like coming to work. It was kind of a shock,” said Royce Terrell, 55, a Dorchester resident who has worked at the restaurant for nearly a year. “I didn’t see it coming. I have to keep working. I’ve got my youngest son in private school*.’*
We the customers have to eat barf pizzas and go to public school, but Dudley Dough’s employees need a living wage so that they can send their kids to private schools. That’s economic justice for you.