Five biggest burger chains pricing out customers

There are few things more American than eating a hamburger, but with post-pandemic inflation — see Bidenomics — hitting the restaurant industry hard, a burger is beginning to be seen as more of a luxury.

That’s according to the Daily Mail, which suggested that a $20 combo meal is fast becoming a “grim reality.”

The newspaper cited a USA Today study to report that while annual inflation for the fast food sector is 4.8 percent, “a typical combo meal at the five biggest burger chains – McDonald’s, Burger King, Wendy’s, Carls Jr and Five Guys – have risen as much as 120 percent in a decade.”

As a result of the increase, Americans are passing on fast food, which gained popularity as much for its low pricing as it did for its convenience.

Source: Daily Mail

“That is more than three times the official rate of inflation – the cost of goods has risen just 31 percent since 2014, according to the US Bureau of Labor Statistics,” the Daily Mail reported. “It is no surprise an astonishing four in five Americans think fast food is a ‘luxury’ because of how expensive it now is, a survey by Lending Tree showed.”

The article cited data from Revenue Management Solutions to point out that in the first three months of 2024, traffic at fast food chains slumped by 3.5 percent from a year ago.

As seen in the graphic above, a Carl’s Jr Famous Star combo has more than doubled since 2014, going from $5.29 to $11.68. Five Guys, which is the most expensive of the five, jumped more than $7 to $20.32.

Interestingly, McDonald’s has seen the smallest increase. At the same time, the chain is running into resistance from some franchise owners over a planned $5 value meal promotion to lure price-weary customers back.

“We know how much it means to our customers when McDonald’s offers meaningful value and communicates it through national advertising. That’s been true since our very beginning and never more important than it is today,” McDonald’s said in a statement.

The National Owners Association said in a letter to the membership that the promotion can’t last without company investment.

“The fact remains that in order to provide the consumer with more affordable options, they must be affordable for the owner/operators,” the letter stated, adding, “McDonald’s vast resources and financial investment are essential to any sustainable affordable strategy.”

“There simply is not enough profit to discount 30% for this model to be sustainable. It necessitates a financial contribution by McDonald’s,” the letter said.

Tom Tillison

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