McDonald's

How Much Should a Big Mac Cost? | Eater

"Once a pandemic-era winner, the company is showing signs of slowing: CEO Chris Kempczinski acknowledged in an investor call that same-store sales rose just 3.4% last quarter, below Wall Street expectations. Executives point to consumer boycotts triggered when its Israeli franchise offered free meals to IDF soldiers—moves that spurred some overseas franchises to pledge aid to Gaza—but a larger issue appears to be falling visits and lower spending by lower-income customers (roughly those earning $45,000 or less). Viral complaints about an $18 combo and wide price variability across regions—driven by the franchise model, local rents, fuel and transport costs, and other local factors—have damaged its image as a low-cost option. The company’s scale gives it buying power for commodities, yet many menu items (for example, the frequently-cited $6 hash brown) still contribute significant profit rather than merely covering costs. Rising labor expenses—average hourly wages at counter-service restaurants increased nearly 30% between the pandemic’s onset and August 2023—and local minimum-wage wins have further pressured pricing, and some executives have framed price hikes as a consequence of higher wages. Critics counter that corporate choices about profit allocation and executive pay, rather than solely labor costs, play a central role in the gap between what a meal costs to produce and what consumers pay." - Jaya Saxena