The cost increases are real: beef, wheat, labor. Some of it is from inflation during the covid period, some it is from the Russia-Ukraine invasion causing havoc in fuel and grain supplies globally.
There is currently a beef shortage in Europe (of sorts). The reason is that buying cow feed has gotten too expensive/unpredictable.
I think people generally underestimate the global impact of shutting down production in Europe's bread basket, Ukraine. There is a reason Russia wants this land. It's, as usual, a war for natural resources.
Beef and wheat are expensive because there is a small handful of companies who produce these for the United States, and they all sit around the same table announcing how much they're going to increase their prices every quarter. It's not collusion, you see, just a fun little coincidence. Because curiously, these particular prices have gone up way faster than inflation, despite having leveled off a year or so ago. Of course, maybe it's the arbitrary taxes the unitary executive has been adding to imports. Oh well. Becoming great again has sacrifices, I suppose, like Big Macs.
I’m trying to be illustrative through glibness here, but…
If consumers can’t afford the prices required to pay a restaurant’s labor living wages, then perhaps they’re not viable customers of that restaurant.
Minimum wages above the market-set rate are a form of price control. The distorting effects of price controls—in this case, contributing to shortages of low-margin restaurant meals—are economically inevitable.
I feel like this whole article is seeking to 'maximize engagement', which I'm using as a lofty euphemism for trolling its readers.
------
Mariam Gergis, a registered nurse at UCLA who also works a second job as a home caregiver, said she’s better off than many others, and still she struggles. “I can barely afford McDonald’s,” she said. “But it’s a cheaper option.”
On Monday morning she sat in a booth at a McDonald’s in MacArthur Park with two others. The three beverages they ordered, two coffees and a soda, amounted to nearly $20, Gergis said, pointing to the receipt. “I’d rather have healthier foods, but when you’re on a budget, it’s difficult,” she said.
Her brother, who works as a cashier, can’t afford meals out at all, she said. The cost of his diabetes medication has increased greatly, to about $200 a month, which she helps him cover.
In 2005 McDonald's net profit margin was ~12%, today it's ~30+%. Obviously that doesn't account for the entire price increase and wouldn't make that much of a difference...but worth noting.
I'm not sure where this number comes from but McDonald's profit margins may be misleading due to their franchise and real estate based model. If you spend $10 at McDonald's that's paid to the franchise and the central McDonald's corporation isn't necessarily profiting $3.
McDonalds business model is to own real estate and lease it to franchisees, and to sell those franchisees supplies to make hamburgers and fries so they can pay the rent.
It’s a commercial real estate company with extra steps, not a restaurant company. Once you understand that, McDonalds net margins are easier to understand.
Google ‘McDonalds real estate’ for a longer write up about the business model of McDonalds
In the 90s I knew families who’d buy bags of McDonald’s $0.29 hamburgers (I think the special sale day was Wednesday) and live on that for the rest of the week.
I can only speak for the UK but for quite a while now, McD's has become an uninviting experience, with miserable staff, menu screens that visibly tell you to hurry the f*k up and choose the product. Not to mention customers vying with delivery drivers for orders. I think the problem applies to all-income customers.
At least from my perspective, COVID broke everything. People are more awful, quality is more awful, and prices are way up. I dread even eating out anymore as I fully expect to overpay for bad food and service.
There's an argument to be made that inflation is ultimately the driver of all three complaints, but boy did that all happen seemingly overnight.
100%. My wife thinks I’m crazy, but every issue she observes my answer tends to have its root in covid.
An economy is an ecosystem and it’s been seriously knocked out of balance by covid, annd the fuel issues aa a consequence of Russias war hasn’t helped either. Everything that was, no longer is.
I don't think COVID is responsible. I think COVID was the straw that made more people use doordash and then retailers saw that doordash was making profit on their product by bundling a service and they got greedy for that profit.
After all, if you'll pay $8 for a big mac + tip delivered to your door, then you'll pay $8 for a big mac. Then to get it delivered is another $2 or so, so you'll pay $10 for a big mac. Then to get it delivered is another $3 or so, so now you'll pay $13 for a big mac.
Australian here and the sentiment is the same. Drive-through is tolerable but dine-in is not pleasant due to basic cleaning like sweeping, wiping of tables not being done.
From the UK too, and your experience is matched by mine. The last time I was in one (I mean "the last time" in both senses of the words) I waited over 20 minutes for my food; I do not know how long it would have actually taken because at that point I got bored, wrote it off as a loss and walked out. No sense in complaining to anyone because that would have consumed even more of my time.
McDonalds is not food and it is not even fast anymore.
I cannot blame their staff for any of this anyway; if I was being paid that little to be treated like garbage I wouldn't give a shit either.
It is not apparent that we are ambivalent because of compensation.
I would argue an inverse corollary. I would argue that the most qualified people for the job are applying.
What I am noticing in my own work is fatigue from processing volume.
It's not personal. You are a statistic until you walk up to the front counter and make it personal. Only then we can actually solve your issue because we have a person to relate to.
I am curious about this notion that fast food workers don't care. I see it a lot. We absolutely care.
I think that merits an apology from me, then: what I said was wrong and I'm sorry. If I'd thought about that sentence for more than ten seconds, it'd be clear that it's all better explained not by indifference from the staff doing the actual work, but because (as you said) they are asked to work under impossible conditions, and as long as some line on a chart representing "money" goes in the right direction it's the people that set the conditions of the job who don't give a shit.
Some part of me understood this already, because...
> You are a statistic until you walk up to the front counter and make it personal.
Aside from the fact that the "front counter" is apparently deprecated these days...given what I know about my personality flaws, I am sure I'd not want to do this. It's not like they could make the food appear 20 minutes ago, and they're not responsible for the conditions that made it take 20 minutes in the first place, so what would it accomplish other than making their day worse? Maybe some warm feeling of "well I fuckin showed 'em" followed by "oh damnit, I was an arsehole" 15 seconds later which would hang over me for a LOT longer than 15 seconds. Walking out was a better outcome for everyone, including me.
Yeah pretty decent in Spain. Give it another 10-20 years when McDonald's realise the customers need them more than they need the customers (ie addiction) and that'll change!
I'd rather just skip a meal than resort to McDonald's, but I've noticed in so many places there are more deliveries going out than people eating in. This seems to go for any place that does delivery. It's even hard to read reviews for places as so many of them are rating the delivery when the food in question doesn't transport well.
There's at least two in the Cardiff City Centre, one on St Mary St and one on Queen St.
Having used both at normal and at peak pisshead hours, they're both alright.
Not great, not a disaster. Slightly understaffed, and occasionally short on English language skills, but there's not an issue if you want hot food (inc vegetarian and vegan) or drinks at a daft hour.
What is strange is McDonalds at one point was by far the most consistent fast food place in the US. Personally it wasn't my thing but it was always a step above all the other chains.
That hasn't been the case in a long time, quality control and customer service has fallen to be just as bad as any other place.
I'm in the UK and have McDonalds semi-regularly. A few times a month at least. Get a receipt, fill out the online feedback form, get a code. Put the code in the app, get an offer for £2.99 sandwhich (McPlant, Big Mac, whatever the chicken thing is) and either fries or a salad. £2.99 for a McPlant and fries at 3am is a godsend.
Yup. McDonald's in the UK is a truly horrible experience that only "addicts" still put up with
Staff barely even look at you, they're miserable, fries are only 50% full, orders always wrong, no please or thanks or sorry for keeping you waiting 20 mins in the bay for a hamburger etc. Stopped going ages ago
This is a trend that's probably going to continue and widen the rich-poor divide. Take airlines, there's only so many seats they can offer day to day, and with planes retiring from service and new planes slow to be delivered the inequality will only increase, and the market will shift to more affluential customers.
The likes of McDonald's will need to understand who their new customer base is quite carefully and market around that if they are to stay relevant. Sadly their products to me are garbage now; slow service, cold fries, awful oil. Obviously they've had to adapt but it's just expensive slop.
And in the UK they have had scandals around sexual harassment, which hasn't helped their image/branding.
These articles deliberately skew reality to fit an anti-worker narrative. All the focus is on costs of labor and materials, with not one single sentence devoted to McDonald’s own financials - like the growth of their margins, the share buybacks performed, the executive compensation, or the franchising model itself.
When I was rallying for a higher minimum wage and was challenged on it driving up costs, I made it abundantly clear that would only be the outcome if the corporate leadership refused to budge on their compensation and shareholder reward schemes - which, surprising nobody, is exactly what they did, and this was the entirely expected outcome.
We’ve tried being nice about this and attempting to reach a compromise in long, gradual, sustainable changes to the economy so everyone can benefit from its improvements in efficiency and scale, but the grim reality is that said compromises are no longer on the table, and harms are inevitable. With no more room to squeeze workers, it should be of no surprise that a growing plurality are demanding immediate and substantial change instead of piecemeal reform - and Capital has every right to be terrified of an angry labor class.
This has been the story in the US for a few decades now. You can’t have nice things that other developed countries take as a given like higher lineage, healthcare, higher education, public infrastructure, etc because of profit, exec compensation, stock buybacks and all the rest.
McDonalds is just a real estate investment trust that happens to sell hamburgers. The business model is ‘rent high value land for a profit while racking up unrealized gains on the land and ensure a steady stream of rents by selling franchisees supplies that they can sell to make sure they can pay their rent.’ Take a look at the sorts of parcels McDonalds acquires, usually multiple acres in busy commercial areas.
In an ideal world, they’d be a restaurant company, but it’s just a real estate company with extra steps.
> These articles deliberately skew reality to fit an anti-worker narrative. All the focus is on costs of labor and materials, with not one single sentence devoted to McDonald’s own financials - like the growth of their margins, the share buybacks performed, the executive compensation, or the franchising model itself.
Capital will always blame Labor for their problems
It could be worse if millions of low-income customers were already as poor as ever in living memory, for quite a number of years and still enjoying McDonalds as regularly as expected.
As recently as a year ago and now the only difference is in the decreased value of the dollar :\",
Where I live (Switzerland), cost of going to some proper burger joint vs mcdonalds costs roughly the same, or its very mildly cheaper for mcd. Plus unlike say France they don't serve beer here(canned heineken but at least its still technically beer).
The only reason to go there is their method of handling tons of customers (restaurant experience this ain't thats for sure), their opening hours and often location.
That's it, if you look for quality or pleasantness of experience or actual good food in statement above you don't have to bother. Worst burgers Swiss market can offer, we have different food and tasting standards here.
You eat at McD's or most fast food places these days, you need the app to get reasonable prices, usually at a 15-20% discount. The app really does enhance the experience, order exactly what you want without human error, roll up to the drive-thru, give them the code, and they begin making the order at that point.
They've been pushing $5 value meals recently because the dollar menu's just not fiscally feasible anymore and $10-12+ for the normal value meals isn't a value to most people.
The app doesn't work if it's installed from a location other than the play store. I install it via aurora store without a Google account for privacy reasons (I do have play services installed but it's not logged in, notifications still work). It's a ridiculous limitation for such an app.
You can thank Play Integrity for this, Google gives app developers the tools to implement remote attestation and "integrity" of the apps and systems they run.
Every time I go to Mcdonald’s, I just think wow, I should have gone to Chipotle. Less expensive and healthier. Better in just about every way. Except no drive thru and you get less food if you order online with Chipotle
Awkward writing in this article. "McDonald’s executives say the higher costs of restaurant essentials, such as beef and salaries, have pushed food prices up..."
Beef and... salaries? I think I found the name of my new fast food place.
The feeling for me is the market has bifurcated into: delivered expensive shit in a bag, or omakase sushi. The middle ground of cheap decent made to order food is largely gone or on the way out. There are diners in my area still but nearly everything is over 10 nearly 20.
The quality for delivery is astoundingly low for unbelievably high prices.
> Her brother, who works as a cashier, can’t afford meals out at all, she said. The cost of his diabetes medication has increased greatly, to about $200 a month, which she helps him cover.
This is an often unacknowledged part of the cost of fast food. It turns susceptible people into diabetics. As a diabetic there is little I can eat there, since I manage it with food not drugs. When I do I get a burger and throw out the bun, which isn't very thrifty.
If you just go with the flow and eat what this culture makes easiest, it's an unusual specimen who can be healthy and happy in late life. And it's not at all unusual to turn young people into patients.
very stupid question, why dont we have a startup say from india that ships container full of diabetes meds directly to people that need them and a person in the USA who handles the distribution. Even with shipping cost included, I dont think it ll be more expensive
81 comments
[ 2.6 ms ] story [ 93.0 ms ] threadI find the phrasing odd. It is because corporations have raised prices that inflation has increased. Rising prices aren't a result of inflation.
There is currently a beef shortage in Europe (of sorts). The reason is that buying cow feed has gotten too expensive/unpredictable.
I think people generally underestimate the global impact of shutting down production in Europe's bread basket, Ukraine. There is a reason Russia wants this land. It's, as usual, a war for natural resources.
If consumers can’t afford the prices required to pay a restaurant’s labor living wages, then perhaps they’re not viable customers of that restaurant.
Minimum wages above the market-set rate are a form of price control. The distorting effects of price controls—in this case, contributing to shortages of low-margin restaurant meals—are economically inevitable.
------
Mariam Gergis, a registered nurse at UCLA who also works a second job as a home caregiver, said she’s better off than many others, and still she struggles. “I can barely afford McDonald’s,” she said. “But it’s a cheaper option.”
On Monday morning she sat in a booth at a McDonald’s in MacArthur Park with two others. The three beverages they ordered, two coffees and a soda, amounted to nearly $20, Gergis said, pointing to the receipt. “I’d rather have healthier foods, but when you’re on a budget, it’s difficult,” she said.
Her brother, who works as a cashier, can’t afford meals out at all, she said. The cost of his diabetes medication has increased greatly, to about $200 a month, which she helps him cover.
------
It’s a commercial real estate company with extra steps, not a restaurant company. Once you understand that, McDonalds net margins are easier to understand.
Google ‘McDonalds real estate’ for a longer write up about the business model of McDonalds
There's an argument to be made that inflation is ultimately the driver of all three complaints, but boy did that all happen seemingly overnight.
After all, if you'll pay $8 for a big mac + tip delivered to your door, then you'll pay $8 for a big mac. Then to get it delivered is another $2 or so, so you'll pay $10 for a big mac. Then to get it delivered is another $3 or so, so now you'll pay $13 for a big mac.
The only losers are the customers.
It truly is the most "Shove this in your slop hole you wretch" experience in all of fast food.
Better replace the kitchen with cooking robots as well then.
McDonalds is not food and it is not even fast anymore.
I cannot blame their staff for any of this anyway; if I was being paid that little to be treated like garbage I wouldn't give a shit either.
I would argue an inverse corollary. I would argue that the most qualified people for the job are applying.
What I am noticing in my own work is fatigue from processing volume.
It's not personal. You are a statistic until you walk up to the front counter and make it personal. Only then we can actually solve your issue because we have a person to relate to.
I am curious about this notion that fast food workers don't care. I see it a lot. We absolutely care.
Some part of me understood this already, because...
> You are a statistic until you walk up to the front counter and make it personal.
Aside from the fact that the "front counter" is apparently deprecated these days...given what I know about my personality flaws, I am sure I'd not want to do this. It's not like they could make the food appear 20 minutes ago, and they're not responsible for the conditions that made it take 20 minutes in the first place, so what would it accomplish other than making their day worse? Maybe some warm feeling of "well I fuckin showed 'em" followed by "oh damnit, I was an arsehole" 15 seconds later which would hang over me for a LOT longer than 15 seconds. Walking out was a better outcome for everyone, including me.
Having used both at normal and at peak pisshead hours, they're both alright.
Not great, not a disaster. Slightly understaffed, and occasionally short on English language skills, but there's not an issue if you want hot food (inc vegetarian and vegan) or drinks at a daft hour.
That hasn't been the case in a long time, quality control and customer service has fallen to be just as bad as any other place.
Staff barely even look at you, they're miserable, fries are only 50% full, orders always wrong, no please or thanks or sorry for keeping you waiting 20 mins in the bay for a hamburger etc. Stopped going ages ago
The likes of McDonald's will need to understand who their new customer base is quite carefully and market around that if they are to stay relevant. Sadly their products to me are garbage now; slow service, cold fries, awful oil. Obviously they've had to adapt but it's just expensive slop.
And in the UK they have had scandals around sexual harassment, which hasn't helped their image/branding.
When I was rallying for a higher minimum wage and was challenged on it driving up costs, I made it abundantly clear that would only be the outcome if the corporate leadership refused to budge on their compensation and shareholder reward schemes - which, surprising nobody, is exactly what they did, and this was the entirely expected outcome.
We’ve tried being nice about this and attempting to reach a compromise in long, gradual, sustainable changes to the economy so everyone can benefit from its improvements in efficiency and scale, but the grim reality is that said compromises are no longer on the table, and harms are inevitable. With no more room to squeeze workers, it should be of no surprise that a growing plurality are demanding immediate and substantial change instead of piecemeal reform - and Capital has every right to be terrified of an angry labor class.
To suggest decreasing those is akin to treason.
In an ideal world, they’d be a restaurant company, but it’s just a real estate company with extra steps.
I agree that minimum wage should be higher!
Are you going to mention what these margins go to?
Capital will always blame Labor for their problems
As recently as a year ago and now the only difference is in the decreased value of the dollar :\",
The only reason to go there is their method of handling tons of customers (restaurant experience this ain't thats for sure), their opening hours and often location.
That's it, if you look for quality or pleasantness of experience or actual good food in statement above you don't have to bother. Worst burgers Swiss market can offer, we have different food and tasting standards here.
They've been pushing $5 value meals recently because the dollar menu's just not fiscally feasible anymore and $10-12+ for the normal value meals isn't a value to most people.
Sure, like paying your local mob boss enhances the experience of not having your legs broken.
Beef and... salaries? I think I found the name of my new fast food place.
No shot?
The quality for delivery is astoundingly low for unbelievably high prices.
I cook way more and am healthier for it.
This is an often unacknowledged part of the cost of fast food. It turns susceptible people into diabetics. As a diabetic there is little I can eat there, since I manage it with food not drugs. When I do I get a burger and throw out the bun, which isn't very thrifty.
If you just go with the flow and eat what this culture makes easiest, it's an unusual specimen who can be healthy and happy in late life. And it's not at all unusual to turn young people into patients.