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.
McDonald's is losing its low-income customers
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Re: McDonald's is losing its low-income customers
#22Earlier quoted context omitted.
No, inflation is a monetary and political phenomenon. Companies cannot set prices arbitrarily, in particular not the fast food industry which faces what is probably the strongest competition on the planet. The entire restaurant industry does not collude on the prices of burgers. In this particular case it's wage-push inflation. The lowest quintile of workers has seen very strong wage gains among other reasons because…
> Companies cannot set prices arbitrarily [Source required] Edit: how are you downvoting me? Go look at corporate profit margins now, 10 years ago, and 40 years ago. If you believe you can hand wave with simplified BS like "Supply and Demand" you probably have some heavy reading on price elasticity to catch up on.
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Re: McDonald's is losing its low-income customers
#23I’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 think the bigger issue is the 500 mil/quarter stock buybacks and the several million compensation packages for the executives than the burger flipper wanting enough money to make it worthwhile to leave their house.
McDonald’s is a franchise. Franchise owners bear the burden of employee and goods costs.
Re: McDonald's is losing its low-income customers
#24The 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 Eu…
We should consume a lot less beef. Wages haven't caught up with inflation in a long while, I'd hope McDonalds paying more would trigger a nationwide increase in wages (I know, too optimistic).
I'm not sure that's true about wage growth, especially at the low end:
https://www.epi.org/publication/swa-wages-2023/
> In stark contrast to prior decades, low-wage workers experienced dramatically fast real [inflation-adjusted] wage growth between 2019 and 2023
Re: McDonald's is losing its low-income customers
#25I’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.
It is quite the juggling act: you have employees demanding to be paid more, the cost of goods/inflation steadily rising, while customers wanting everything to be cheaper. Something has to give somewhere, the challenging part would be to know where.
How about executive compensation?
Re: McDonald's is losing its low-income customers
#26Earlier quoted context omitted.
It is quite the juggling act: you have employees demanding to be paid more, the cost of goods/inflation steadily rising, while customers wanting everything to be cheaper. Something has to give somewhere, the challenging part would be to know where.
Don't forget company leaderships and stock owners taking more and more profit out of companies than ever.
Take 100% of their salaries and profits and it would make a negligible, likely unnoticeable difference in this issue.
Re: McDonald's is losing its low-income customers
#27The 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 Eu…
We should consume a lot less beef. Wages haven't caught up with inflation in a long while, I'd hope McDonalds paying more would trigger a nationwide increase in wages (I know, too optimistic).
Agreed. Sheep are a much more sustainable ruminant and we should all shift that way. I always heard it was spoiled cans of mutton fed to GIs that killed Americas taste for sheep. More importantly, we should stop eating food shipped in from far away. Not as easy as it sounds.
Re: McDonald's is losing its low-income customers
#28I’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.
It is quite the juggling act: you have employees demanding to be paid more, the cost of goods/inflation steadily rising, while customers wanting everything to be cheaper. Something has to give somewhere, the challenging part would be to know where.
Markets are the best mechanism ever invented to resolve that challenge to maximum aggregate benefit.
Re: McDonald's is losing its low-income customers
#29Earlier quoted context omitted.
It is quite the juggling act: you have employees demanding to be paid more, the cost of goods/inflation steadily rising, while customers wanting everything to be cheaper. Something has to give somewhere, the challenging part would be to know where.
Don't forget company leaderships and stock owners taking more and more profit out of companies than ever.
That's been said forever, but only ever said.
Re: McDonald's is losing its low-income customers
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