Executives of Yum! Brands, the parent of Taco Bell and KFC, are less pessimistic than McDonald's franchisees about the likely impact of the omnibus health-care reform law (see item below). Indeed, said CEO David Novak, the initial impact will likely be a $6 million tax savings on the medical benefits that are provided to Yum retirees.
Longer term, Novak told investors during a conference call, franchisees will be stung by an additional cost of $10,000 to $15,000 per unit. But that burden won't be dropped on them until 2014.
"We are going to work with them to mitigate the cost," Novak said. "WE have plenty of time, I think, to deal with the issue."