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McDonald’s Bows To Customer Price Complaints

The standoff (such as it was) is over. McDonald’s is officially promising to change focus and emphasize value over other menu and service issues. It’s a reaction to plunging sales. In some places the flagship Big Mac Combo is edging close to $18…

Big Mac Combo - © 2024 - McDonald'sThe classic Big Mac Combo: Centre of a cotroversey…

Not lovin’ it?’

It appears McDonald’s – the bellwether of the fast food sector – has marked another milestone for the industry, promising to focus more on ‘affordability’ after customers expressed mass outrage over soaring menu prices.

McD’s CEO Chris Kempczinski told a recent quarterly earnings call audience: “I think what you’re going to see as you head into 2024 is probably more attention to what I would describe as affordability,”

“Eating at home has become more affordable,” Kempczinski explained. “The battleground is certainly with that low-income consumer.”

Stratospheric prices in some places

McD’s took intense flak from consumers aster reports of record menu prices in Connecticut. A customer vented their outrage on social media after being charged $7.29 for an Egg McMuffin and $5.69 for a side of hash browns. The franchise in question, in Darien, Connecticut, was also slammed for charging $17.59 for a Big Mac combo.

That was all it took for McMenu rage top go viral. Seems folks in Socialmedialand were just waiting for a trigger to express their frustration.

No Fast Food price relief in sight

Two factors current bode ill for any relief from high Fast Food menu prices. First, food prices are expected to go even higher, at least over the fist half of this year. Though the rate of increase is expected to slow a bit.

And resto costs are soaring as new minimum wage laws come into effect in many US states. In California, for instance, Fast Food workers will be entitled to an hourly rate of at least $20 starting April 1. And that’s no joke!

My take

I wonder what McDonald’s upper management will be able to do to reduce, or even rein-in, rising menu prices? I’m skeptical that they’ll do anything that might adversely affect their shareholder profits. It’s always been ‘shareholders first, customers last’ when it comes to financial decisions  by major corporations that are publicly traded.

But what can they do? They have no control over food prices or minimum wages.

It seems the shareholders will have to indicate which of two hard choices McManagement should make: Cut prices and, thus, cut per-sale profits? The hope there would be to make up in sales volume revenues they would lose on a per-sale basis, if low-income customers said goodbye. Or will they choose to foresake the little people and try to ride on reduced unit sales at higher prices?

~ Maggie J.

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