Helaine Olen’s Post

To anyone saying that price increases over the last few years were solely due to supply-chain issues and the pandemic, please read the following: #pricegouging #inflation #weaponizedpricing

The tale-of-two-cities economy and ...... the resulting pullback has finally caught corporate America’s attention ....... would these in between lines spell good times for economy following price increases that have exceeded wage gains in recent years. it is also time that corporate America take note of the extreme wealth divide that if unchecked, become more disastrous for businesses and economy. With such extreme pull visibly glaring, low economies increasingly cannot afford even necessary commodities with no room for other goods, while high economic groups also cannot profit from their own goods and products. It is time to find better way sooner to bring back the sustainable economy up and running.

Caught in the crossfire of inflation, how are major companies like McDonald’s fighting back? Discover how a simple $5 Meal Deal is shaking up the industry and catching the attention of corporate America. Other companies like Walmart, Target, and Starbucks are also cutting prices. The Covid-era inflation was due to the lockdown, but many companies used it to raise prices. #McDonald's #McDonalds #valuemeal #inflation #greedflation #restaurants #fastfood #MealDeal

Price Wars in Fast-Food Markets: Inflationary pressures have forced fast-food chains to begin trying to win consumers back, after the chains jacked up prices during the pandemic and consumers began eating at home more. Measures of inflation show that fast-food inflation rose faster than restaurant inflation, and McDonald's led the way in that race. The brand's pre-COVID net margin hovered between 24% and 27%. The post-COVID picture looks very different, as McDonald's net margins rose to over 32% to outpace inflation. However, since customers have been eating out less to combat the raging price inflation, Burger King, McDonald’s, Taco Bell, Wendy’s, and Starbucks have begun rolling out “value meals” in the $5 dollar range, creating a price war began the big fast-food chains. The problem with these $5 meals is that franchisees will now see their profits falter, which is where McDonald's size comes into play. While a race to the bottom could hurt all players, McDonald’s, with its rich profit margin and cash flow, seems best positioned to emerge as the winner. Other fast-food chains may be concerned that undercutting their own profits too much could lead to franchisee failures. For buyers and sellers of retail real estate, understanding the underlying financial health of retail tenants is crucial to maximizing investment dollars. To keep up with the market trends, visit https://bit.ly/4eArrLr, a go-to resource for constantly-updated national and regional cap rates, comparable sales, and consumer traffic for dozens of top retail tenants. #fastfood #cre #inflation #commercialrealestate

McDonald's on Wednesday pushed back against the premise that recent price increases have been unreasonable, arguing the Golden Arches offers "meaningful value" for what it charges. The fast-food industry as a whole is under pressure from a public frustrated by inflation, and is struggling to retain customers as rising prices drive more people to dine in, or find better ways to save money. In a rare open letter, McDonald's USA President Joe Erlinger said the assertion the chain has hiked its prices "significantly beyond inflationary rates" is "inaccurate." He bashed "viral social posts and poorly sourced reports" about price increases, while acknowledging the company has faced "inflationary pressures." He noted that franchisees set prices in the 95%+ locations they own and operate. Erlinger said "prices for many of our menu items have risen less than the rate of inflation – and remain well within the range of other quick service restaurants." The average Big Mac price is $5.29, he said, up 21% from $4.39 in 2019, which the executive said accounts for "historic" hikes in wages, costs and supply chain issues. Last year, the Golden Arches was pushed into damage control mode after reports of an $18 Big Mac meal (it was at one location) exploded on social media, something Erlinger addressed in his letter. "More worrying, though, is when people believe that this is the rule and not the exception, or when folks start to suggest that the prices of a Big Mac have risen 100% since 2019," he wrote. McDonald's overall prices are up 20% since 2022, Bank of America analyst Sara Senatore wrote Tuesday in a research note. That compares to 15% at Wendy's and 16% at major Burger King franchisee Carrols. McDonald's and Burger King are reportedly poised to debut $5 value meals following heightened attention to their price hikes.

It’s never too late to provide value. The $5 Meal from McDonald's is finally back which should substantially drive topline revenue and help many in America who can’t find an affordable meal these days. Why do you think it took QSRs this long to create the value meal campaign when inflation has challenged everyone for a few years? Looking at all the marketplace ads, it’s a race to the hearts and stomachs across all brands. #inflation #value #hungry #qsr

Is inflation impacting consumer spending in the discount sector? According to McDonald's, the answer is yes. The fast-food giant reports that its stock price has decreased slightly, likely due to higher prices causing customers to rethink dining out. And it's not just McDonald's; traditional low-cost retailers are feeling the pinch too. Family Dollar's parent company recently announced the closure of nearly 1,000 stores, citing decreased spending from consumers. As prices continue to rise, it will be interesting to see how consumer behavior evolves in response. #inflation #consumerspending #discountretail https://lnkd.in/eVssXDKm

Violating brand guidelines has new meaning in today's economy. Boy, times have changed from when several food companies went as far as to admit to raising prices in order to pad earnings because they knew consumers would pay. As those days fade fast into the rear view mirror of the economy, companies are now facing a new 'great resignation', as consumers bail on restaurants, supermarkets and big brands due to rising prices. From snacks to fast food, companies are feeling the negative effects, who are scrambling with promotions galore to win them back. The fall of loyalty programs speaks volumes. Just last year, companies including Starbucks and Dunkin' fiddled around with their loyalty programs that essentially required more points (and thus purchases) in order to redeem free items. For many customers, that along with rising prices was the last straw and munchkin. Another example is McDonald's where that 'dollar doesn't go as far' menu has customers looking for value elsewhere. There's nothing happy about its Happy Meals these days, and the promotions have certainly received plenty of social media attention for all the wrong reasons. Like its customers, Ronald is grimacing at mixed earnings results. Everyone wants to be the new Trader Joe's. Consumers are ditching big brands and embracing private labels as they look to stretch their dollars. Made by outside manufacturers but sold under the store's own brand name, private labels aren't just gaining traction with budget-minded buyers but even higher income consumers who are increasingly less hung up on big-name brands. Walmart and Amazon all see the opportunity, which is one reason they're expanding their private label offerings. And of course, you have other stalwarts like Costco and Safeway among others who are all battling for consumer loyalty and a bigger piece of the grocery pie. "They make money the old fashioned way, they earn it"...that old tagline from the way back machine resonates more than it ever has for today's big brands. They may have decades and decades of history and legacy, but reputation only goes so far with today's consumer. Money and loyalty still must be earned over and over again. Brands are getting that reminder as we speak https://lnkd.in/epvqCeNU #fastfood #restaurants #brands #inflation #consumers #economy #privatelabel #retail #customerloyalty #reputation

"Restaurant chains and some food manufacturers are reporting sliding sales or slowing growth that they attribute to consumers’ inability—or refusal—to pay prices that are in some cases a third higher than prepandemic times." For restaurant customers, it's challenging to accept steep price hikes when the experience versus pre-pandemic times is either the same or worse due to labor shortages among wait staff. As for big, national brands at grocery stores, there's only so much that marketing and packaging can do to command premium prices when the quality of private store brands continues to improve (and also boosts grocery store margins). There's a reason that being within a certain radius of a Trader Joe's store (mine is about 3 miles away) can boost home prices. It will be interesting to see how this plays out over time. #foodprices #foodinflation #restaurants #fastfood #inflation #foodmanufactuers #nationalbrands #storebrands