Has your wallet felt a little lighter than usual? It’s probably not just your imagination.
Some of the world’s biggest fast food companies have raised prices this year in response to rising food and labor costs, but these giant brands hope you don’t notice. By adopting the sneaky strategy of raising prices by just a few cents and maybe a dollar here, these chains hope to covertly cover their extra costs at the expense of the consumer.
Anyone with bills to pay is well aware of how inflation has skyrocketed this year. Just as millions of Americans have had to slash their budgets and cut spending, so do businesses of all shapes, types, and sizes. The fast food industry is not immune.
According to the National Restaurant Association, the cost of fast food in September 2022 increased by 8.5% compared to just a year ago. Fast food brands are trying to protect their profits without turning their customers away. This is hard work in any industry that aims to save consumers’ money, let alone.
Here is a more detailed breakdown of how Some of the biggest fast food brands raise prices in 2022:
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Golden Arches is synonymous with fast food, but customers have had to spend a little more to enjoy their McFavorite this year. Mickey D’s reported an average annual price increase of 10% in the US for the third quarter of 2022.
Despite these price increases, McDonald’s CEO Chris Kempczinski said in a recent investor call that the chain did not realize that more customers were opting for cheaper menu options. This is probably because many Americans are turning to budget options like McDonald’s rather than the more expensive restaurants they might have eaten at in previous years. Although no longer a “dollar menu,” Kempczinski is confident that McDonald’s is still an attractive dining option.
However, some customers have definitely noticed the price increases. Some McDonald’s employees reported a large increase in customer conflicts over prices this year.
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Wendy’s menu prices are up just under 10% this year, according to the brand’s Q3 earnings release. Interestingly, the iconic fast food brand isn’t all that concerned about consumers looking for cheaper options.
“We still have four for $4 on the menu. We have the $5 Biggie Bag which is very interesting. We brought great things like Strawberry Frosty to the calendar at a great price. We have a $3 croissant dinner there. Wendy’s CEO’ During the interview, Todd Penegor said: “For breakfast right now.
Pizza prices have also increased this year, with Domino’s reporting an average price increase of 5.4% at its US locations in the third quarter of 2022. In fact, the brand is predicting further price increases in the fourth quarter (7%), mostly due to the pizza chain. Increasing the price of the Mix & Match deal from $5.99 to $6.99 in October 2022.6254a4d1642c605c54bf1cab17d50f1e
“The philosophy of how we look at pricing in the company… [has] Sandeep Reddy, Domino’s CFO, said during the earnings call: “We would look at our input costs and essentially what that does for franchisees and our own corporate stores in terms of long-term store profitability. But then we also look at relative consumer price points and market competition. “
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Compared to the third quarter of 2020, Chipotle prices have increased by over 20%!
Most recently, Chipotle CFO Jack Hartung announced during an earnings call that Chipotle increased menu prices at nearly 700 locations in October by approximately 2-3% to “address exorbitant wage inflation.” Overall, these increases boosted prices across the brand by 0.5%.
But CEO Brian Niccol was quick to mention in the same call that Chipotle’s prices are still 10-30% lower than what its direct competitors are charging. He does not believe that recent price increases have damaged the chain’s reputation with consumers.
“When you look at the work, we don’t see people suddenly taking guacamole or changing what they usually add to their order or switching between proteins. Everything has stayed pretty consistent,” he explained.
Similar to the other chains discussed above, Starbucks has been steadily increasing prices in recent years. For example, even add-ons like syrups and sauces are more expensive today than they were a few years ago. Still, the brand swears that shoppers are just as happy as ever to spend their hard-earned money on a Venti or Grande Cappuccino.
CEO Howard Schultz said during the chain’s Q4 earnings call that the Seattle-based coffee supplier has increased prices by nearly 6% in 2022, and customer interest hasn’t waned in any way. “Their commitment to Starbucks was significant and predictable,” he said.
John Anderer is a writer specializing in science, health and lifestyle. Read more about John