Coalition of Franchisee Associations

July 26, 2019

How Much of the 5.7% Sales Increase Was Menu Price?

Management says menu price increases were 1/3 of the increase and their brilliant
initiatives were responsible for the balance. What do McDonald's Operators think?

Higher Prices Drive McDonald’s U.S. Sales Gain as Traffic Lags - Bloomberg


Anonymous said...

It was ALL price increases! GC’s continue sliding!

Anonymous said...

About half of the increase was price but my city stores do a fair amount of delivery so that has raised my SSS. Too bad I wont make any money the delivery portion of the increase.

Anonymous said...

State minimum wage increases and rising labor cost to added positioning of GEL, Table Service, BDAP and OPL have went to the menu board. As once drivers like $1 Drink, $2 McCafe, National get something free today, GMA and other promotional offers falter to drive transactions. Wonder why the marketing chief has left....

Anonymous said...

Dollar menu has always negatively impacted transactions, where follow-on (add on) sales use to happen more frequently. When products are undervalued, people buy more initially - eliminating that once follow-on sale.

For example, a construction worker may of once purchased a QPC meal - then if still hungry bought a McDouble. Now they just add it to the original order.. if they eat it, they eat it. If not, not a biggie - waste.

Raising the core pricing due to stuck drinks has killed the EVM and propagates that same purchasing mentality. When the burger crosses that $5 threshold without a reasonable quality marketing message - TCs will collapse further. You need to reduce the sandwich price by offsetting it with the drink and fry price. MCD competition can do that - and $1 drink ties MCD to a frivolous battle with a unknown competition (C-Store?).

Marketing doesn't market - it advertises. And the new generation doesn't strategize, it discounts. Discounting is a small part of marketing - yet has become the single marketing strategy of McDonald's. McDonald's no longer sells hamburgers - it promotes them.

Anonymous said...

Why are we STILL selling $1 coffee (when it's not free, that is) and only $2 for a latte??

We opened McCafe about 10 years ago at$1 and we still can't get more than $1 for a coffee any size??? Really?
That tells me that we wasted all recent invest,mets in the McCafe prgram. When we should have cut and run from it, especially after MCD management started to compete against us in grocery stores.

Repeating the same failing strategy and expecting a different result is the definition of insanity. I guess it's not so bad when it's not your money, but for O/Os it IS our money. We need to revolt on the price point.

Join NOA

Anonymous said...

All of it.
No increase in guest counts.