What Obama's Victory Means for Business

Corporate America never was among those chanting "four more years."

Some business leaders had backed Mitt Romney hoping the Republican would pursue lighter regulation and business-friendly changes to the tax code. After President Barack Obama's victory, CEOs say they are looking for a softening of the standoff between Congress and the president that characterized much of his first term in office.

Here is a rundown of restaurant industries may see during President Obama's second term:

Restaurants

The president's policies have helped small businesses obtain loans to expand and recover from the recession over the past couple of years, but restaurant operators are anxious changing tax rates and new health-care legislation.

 
Many of the nation's largest restaurant chains, such as McDonald's Corp. MCD -1.99% and Dunkin' Brands, are primarily operated by franchisees who have anywhere from a handful to a few hundred locations. As small-business owners, they complain excess regulations are squeezing their profits.

 
"There are a lot of issues restaurants face with regulation around health care, tax rates, immigration, credit- and debit-card interchange, and menu labeling," said Scott DeFife, the National Restaurant Association's executive vice president of policy and government affairs. "The pace of these regulations is likely to pick up now that the elections are over."

Mr. Obama's health-care law, for instance, is expected to increase labor costs and prevent expansion among smaller franchisees.

"The law is going to take effect, so we will have to focus on the things within it that we can change—the aspects that will make this law so onerous," the 30-hour threshold for full-time workers and some of the reporting requirements, said Judith Thorman, senior vice president for Government Relations for the International Franchise Association.

Restaurant chains won't know how much the legislation will cost them until states set up the exchanges through which coverage can be purchased. But they believe it is going to hurt.

McDonald's and Papa John's International Inc. PZZA -3.79% have said they expect their franchisees to take a hit as they are forced to offer more expensive health insurance or pay a government penalty.

Darden Restaurants Inc., DRI -2.64% which owns Olive Garden and Red Lobster, is considering reduce its employee hours to minimize the impact. Other industry consultants expect food chains to raise their menu prices to offset the higher costs.