It's still the Dollar Menu
The price of beef and buns keeps rising, but McDonald's wants to keep items like the double cheeseburger on the Dollar Menu. Dan Grech reports franchisees will absorb costs -- and they may not be happy about it.
Fries, coffee and a Snack Wrap at a McDonald's restaurant in Des Plaines, Ill. (Scott Olson/Getty Images)
More on Retail
TEXT OF STORY
Scott Jagow: Food prices have people eating out less. Unless it's to hit the dollar menu at Mickey-D's. But the local people who run each McDonald's do not like this development. Dan Grech explains.
Dan Grech: McDonald's best-selling sandwich isn't the Big Mac -- it's the $1 double cheeseburger. The chain says it will stick with the Dollar Menu, even as cheese, buns and beef become more expensive.
McDonald's corporate is insulated from these price increases because they're absorbed by franchisees.
Howard Morrill: It's a real horrible tension for these people who are potentially losing money on the transaction.
That's Howard Morrill, an attorney that represents franchisees. The fast-food chain spends tens of millions of dollars promoting its Dollar Menu. Franchisees can opt out, but:
Morrill: You've basically spent your marketing dollar promoting something you don't do. So it's kind of a catch 22. You may have higher margin business, but you're going to chase people away and make them angry.
Some New York stores have taken double cheeseburgers off the dollar menu. And McDonald's is testing the sandwich in Georgia and Mississippi at a $1.09.
I'm Dan Grech for Marketplace.
Comments
Comment | Refresh
From Freeport, TX, 06/05/2008
I know they must be crazy to sell Dbl. Cheeseburger for $1.00. I own a seafood restaurant next door to Mc Donald and I am selling my Double cheeseburger with fries at$7.60+tax, and we sell a lot of burgers everyday.
I still think that I am losing money. How do Mc Donald do it at a dollar and makes money? I need to learn that formular.
From IA, 06/05/2008
Our McChicken and Double Cheeseburger jumped to 1.59 about a month ago. I can't imagine they make any profit at a buck on those things anymore.
Post a Comment: Please be civil, brief and relevant.
Email addresses are never displayed, but they are required to confirm your comments. All comments are moderated. Marketplace reserves the right to edit any comments on this site and to read them on the air if they are extra-interesting. Please read the Comment Guidelines before posting.
You must be 13 or over to submit information to American Public Media. The information entered into this form will not be used to send unsolicited email and will not be sold to a third party. For more information see Terms and Conditions and Privacy Policy.