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That's pure greed at this point...Jimmy John's is still well in an affordable range. As a rule, I tend to avoid buying food from places with surge pricing as fast food is supposed to be affordable! It's not fine dining and as a result should be priced appropriately; they've forgotten their role in the food space and thus their business will live or die based on future choices.
if base food prices really make the old fast food economics nonviable, I expect the space to die off and be replaced by fast causal. otherwise I expect a lot of them to die on their own greed and the rest to get with it. it seems the fast food space is going all in on drive-thrus so maybe that's their future niche?
That’s just it, we can see the finances of McDonald’s, and they could definitely make their burgers quite a bit cheaper if they wanted to. But they keep wages low and prices high because it allows them to make massive profits.
Which is stupid to do in the long run, because a nice restaurant is the same price or slightly higher. But all the stockholders are concerned about is quarterly profits, not long term ones. Capitalism is remarkably short sighted.
Ride your quarterly profits and attendant bonuses as long as possible and don’t give a shit about the future because that’s the next CEO’s problem in less than 5 years from now when you golden parachute out
Fast food has been all in on drive thrus since the inception of drive thrus. Most places make about half of their money that way and for some it's far more.
We got JJ's a couple weeks ago. 3 sandwiches and 3 cookies was over $50. That was not worth anywhere near that much.
Yikes! On average (as a single dude) it’s around 19 and some change for delivery. In store I end up paying around 13 dollars! For more than one person, it’s better to eat at a proper sit down restaurant.
Surprised to hear this. Where im at Jimmy John's is the most expensive. I wonder if it's supply chain related.
I wonder about that, it could be they simply feel that’s a price people will pay there! Honestly, if I get a sandwich, chips, and a cookie for delivery it’s around 19 and some change. If I buy in store it’s around 13 dollars.
In addition to my original comment, I totally forgot about Culver’s which would actually be the cheapest; Their value combo is less than 10 dollars and mighty tasty! I visit both places as they are lighter on my bank account.
Fast food was affordable because they paid sweat shop wages. That’s not the case anymore. In any event.. I would argue with the “supposed to be” affordable comment. Just because it was doesn’t mean it’s supposed to be. As far as I’m concerned this can only be good for the health of the public- when fast food prices are at least comparable in price to healthy options.
Edit: lol at all the people comparing the US to Nordic countries. Apparently they think US franchise owners are the same as those in countries where making a profit is akin to a sin. Hahaha. They thought by raising wages, owners would cut into their own bottom lines. “Bruh, in countries where mcmansions don’t happen, this isn’t a problem.” Net profits have not gone up at all compared with the rest of the economy.
And apparently people really like their cheap big macs. Eat something else? And I’m sure many of them were arguing for livable wages over the past five years (I was). This outrage is hilarious.
Edit 2: Apparently people don’t know what “gross” means. If my costs go up, then my prices go up.. and my gross returns go up to cover both the costs (expenses) and net proceeds. I’m at a complete loss at the nature of these arguments.
McDonald’s NET growth from end of 2009 to 2023 was 4.56 B to 8.47B. A 186% increase. This is roughly a 5% annualized increase. I intentionally sought pre/post COVID numbers for a reason.
In this same time the US GDP grew from 14.47B to 27.35B. Almost the exact same rate of growth at a 189% increase.
Net profits are what you’re concerned with in your arguments when accounting for greed.. not gross. If anything, I’ve shown McDonalds is making less money today. But you know, feels are more important than facts.
My guy, it's cheaper to get a big mac in Norway than in the US and their lowest wages are more than double ours in the US.
Yes but the owners in Norway aren’t making more profits than last year.
The whole problem isn’t that they’re not making good profits, but that it’s not exponentially growing profits.
Greed.
I won't believe paying fast workers a liveable wage necessitates the rise in cost unless there's hard data behind that. Sure, it's likely a necessity to continue profit growth quarter after quarter, but I'd wager they're able to continue making massive profits even with having to pay their staff like they're humans.
I agree with you about fast food though. We'll be better off without them. Fuck em.
Hey, I can edit too: You never said gross prior to your edit, you were talking about consumer costs. I'm still not yet a believer, but I Iove you :)
Since labor is a cost. You just defeated your argument.
If labor goes up, prices will go up. It’s that simple. Fast food is only profitable at high volumes. Their profit margin is only around 10% which is low.
McDonald’s in Europe charges similar prices to America but pays living wages to their employees.
McDonalds gross profits are $14.68B over the last 12 months with over 9% year-over-year growth.
They aren't struggling and other than covid (which just held steady for a few years at $10B), the trend has been going up, not down, not stagnant for many years.
Remember that's gross profits. If wages were hitting them hard, then we'd see the trend decrease but that isn't what happened or is happening.
Yes, you’re comparing COVID lows with today’s returns. That’s perfect. Not that I give a damn about franchise returns. I just don’t eat there.
Do you have any idea what “gross” means? You’re literally including the increase to wages in your argument.
I don't think anyone actually thought that.
They're simply making the point that the problem is not the wages paid to the employees, as you imply, but the obscene salaries paid to executives and franchisees.
That the American execurives and franchisees are not going to take the necessary steps to correct that problem pretty much goes without saying, but that doesn't in any way change the fact that that is the problem
The profits today aren’t any different than the profits from 15 years ago (when fixing for economic growth). I’ve already done the math. The only significant variable that’s changed here is wages. I.e., expenses.
Undoubtedly.
And that in no way contradicts, or even really addresses, my point, which is not about overall expenses, but about the distribution of them - the portion that goes to employee wages vs. the portion that goes to executive compensation packages.
Why are you complaining that wages are on the increase? Who’s paying you?
Point out that complaint please.
And you read that as a complaint? That’s your issue if you interpret plain facts as complaints. Feel free to read a little more thoroughly.
2023, McDonald's net income $8.5B on $25B revenue, or 34% net profit margin.
2009 net income $4.5B on $23B revenue. 20% profit margin.
Over the time period that you picked, their profits - the money that they don't pay to either workers or farmers - nearly doubled as revenues barely changed.
Fast food absolutely still pays well below a living wage in most of the US