Despite sensational headlines like “Why McDonald’s Killed the Dollar Menu — In One Chart,” the dollar menu isn’t dead. No more than dollar stores that price some things above $1 are.
The rebranded Dollar Menu & More will hit all restaurants on Nov. 4, Bloomberg Businessweek says. It will still feature items for $1, but also some sandwiches for $2 and things like a 20-piece McNugget box for $5.
McDonald’s CEO Don Thompson described it as a “value ladder of sorts” on an earnings call this week. His hope is that the cheap items will keep bringing people in, and the more expensive items will take some of the pressure off of franchisees.
Since the dollar menu was launched in 2002, “the low price point has been a point of contention with McDonald’s franchisees,” Quartz says. McDonald’s corporate arm wanted pricing to be uniform across restaurants, because it’s hard to market a dollar menu with inconsistent prices. But franchisees didn’t want to be stuck with the rising cost of ingredients. The $1 McDouble was born out of those fights; it’s just a double cheeseburger with one less slice of cheese. And now that McDonald’s is lifting the price cap on the dollar menu, franchisees will be allowed to charge more for that too.
The new menu may also be a way of conditioning us to higher burger prices, Businessweek suggests: “The new menu will help customers become accustomed to seeing the higher prices at [the] low end of the menu.”
More from Money Talks News
- Consumer Discretionary
- Arts & Entertainment
- Dollar Menu