McDonald’s Considering a Dollar Menu Revival with $5 Meal Deal

• McDonald's is considering introducing a $5 meal nationwide to attract customers back to its locations, which may include a choice of McChicken, McDouble, or chicken nuggets along with fries and a drink.
• CEO Chris Kempczinski emphasized the importance of keeping pricing low during an earnings call, amid rising minimum wage laws in states like California, where fast-food employees are now required to earn $20 per hour.
• McDonald's has faced criticism for its increased menu pricing, with nearly 25% of those earning less than $50,000 reducing their fast food consumption due to cost concerns. Industry analysts suggest that targeting lower-class consumers may be necessary for fast-food businesses to maintain sales and profit targets.

McDonald's is considering introducing a $5 meal to its menu nationwide to lure patrons back into its locations.

The meal may consist of a McChicken, a McDouble, or four pieces of chicken nuggets along with fries and a drink. McDonald's corporate headquarters representatives are still in discussions with franchise owners regarding launching the $5 meal.

During an earnings call with analysts and investors on April 30, McDonald's CEO Chris Kempczinski stated that the firm had to be "laser-focused" on keeping pricing low to get customers to return.

This year, which began with over half of the states raising their minimum wage-including New York and California, where hourly wages were raised to $16-McDonald's hasn't been focusing on keeping expenses down.

Impact of Minimum Wage Laws on Fast-Food Businesses

However, on April 1, Golden State also enacted a law requiring fast-food employees to earn $20 per hour.

Many franchisees around the nation raised menu prices to cover growing labor expenses. One such franchisee is Scott Rodrick, the owner of McDonald's, who claimed he has already raised menu prices 7% at the 18 sites he controls and is now considering lowering shop hours.

Consumers also took offense when they discovered that a Big Mac costs $18 at one Connecticut store, while an Egg McMuffin costs an outrageous $7.29, and a single side of hash browns costs $5.69.

Read also:Food Prices Down in 2024? Time to Revise Your Grocery Budget

McDonald's Menu Pricing Trends and Consumer Behavior

The personal finance website FinanceBuzz states that McDonald's increased its menu pricing to the highest of all fast food companies in the United States between 2014 and 2024. Based on cost concerns, almost 25% of those earning less than $50,000 are reducing their fast food consumption, according to a January survey conducted by consulting company Revenue Management Solutions.

Restaurant businesses attribute pricing increases mostly to increased labor expenses. However, industry analysts stated that if fast food businesses want to maintain meeting their sales and profit targets, they must target lower-class consumers.

Of course, a $5 meal wouldn't turn McDonald's into a trailblazer in the fast food sector. In addition to its $5 Biggie Bag, Wendy's debuted the 4 for $4 meal in 2015, which consists of a tiny cheeseburger, four pieces of chicken nuggets, small fries, and a small drink. With the latter package, you receive four chicken nuggets, a small order of fries, a small drink, and a choice of sandwich.

The largest fast food giant in the country, McDonald's, employs more than 2 million workers at its 14,300 outlets and an additional 150,000 at its corporate headquarters.

Related article:Fry Attachment Rate Stays High, Signaling Consumer Confidence

The content provided on MoneyTimes.com is for informational purposes only and is not intended as financial advice. Please consult with a professional financial advisor before making any investment decisions.