Home / Uncategorized / Replacement of McDonald’s dollar menu feeds the industry price war

Replacement of McDonald’s dollar menu feeds the industry price war

The fast food price war is about to get even more intense.

McDonald's Corp., the world's largest restaurant chain, unveiled its new value-priced menu on Monday, with the goal of maintaining its leadership in an increasingly growing industry by the fund. The lineup, which begins on January 4, includes items such as chicken, Happy Meals, soft drinks, triple burgers and Egg McMuffin.

With visits to American fast food restaurants that will remain unchanged next year, the main chains are competing for the position and announcing discounts to keep diners' attention. Taco Bell, the Mexican-themed chain owned by Yum Brands, is responding with what it calls its greatest value momentum in the company's history.

McDonald's will launch a new menu of dollars next month in & # 39; value wars 2.0 & # 39; »

The new offer at McDonald's, which will run along with the regular menu at restaurants, is a balancing act for the Golden Arches. If the items are priced too high, customers feel that they are being cheated and directed to the competition. But if the prices are too low, the McDonald's franchisees will make amends.

That was the case with the company's Dollar Menu, which was eliminated in 2013. McDonald's operators thought it weighed too much on profit margins, but the menu was popular with customers. And his absence was felt. The disappearance of the Dollar Menu was seen as a contributor to a decline in sales that lasted two years.

This time, McDonald's believes it has a formula that can keep franchisees happy. More than 90 percent of restaurant owners signed up to participate in the program, according to Chris Kempczinski, who runs the company's operations in the US. UU

"You have to make sure it's something that we can maintain," he said in an interview.

Andy Barish, an analyst at Jefferies, updated the stock to "buy" on Tuesday and raised its target price to $ 200, in part because the new value menu will help the chain continue to win customers.

McDonald's shares up 2 percent to $ 174 in New York On Tuesday, in the biggest intraday gain in more than two months, the stock had already risen 40 percent this year until the Monday.

McDonald's announced in October that it was planning the menu, although he did not give details until Monday. The idea is to shore up a return based on the success of breakfast throughout the day and more discounts from Ted like McPick 2 for $ 5.

When the new menu arrives next month, customers can get a handful of options for $ 1, $ 2 or $ 3. Cheaper items include soft drinks, McChicken sandwiches, a burrito with sausages and cheeseburgers. The McMuffin sausage with egg is on the menu for $ 3, along with a new chicken sandwich. And the company's buttermilk chicken offerings, which were sold last month after a brief run, are returning to the menu, with an order of two costing $ 2.

One popular item missing is the French fries. Kempczinski said the company spent months trying to figure out the best way to build the new menu and finally decided it was convincing without French fries.

"We do not need French fries to make it attractive," he said.

Taco Bell, meanwhile, seeks to remain in the mix as McDonald's and its rival burgers at Wendy & Burger King are increasingly looking for ways to attract fast-food customers who are looking for discounted rates.

Owner Yum's shares changed little on Monday at $ 83.32

Taco Bell reminds customers of a $ 1 menu with 20 items, and this line will be reinforced by 20 more limited-time offers in 2018. The menu will include nacho fries and a new "stacker" quesadilla – meat and cheese in a flour tortilla. [19659002] "I think many places are reluctantly trying to figure out what foods to serve in these programs. points of ice, "Brian Niccol, executive director of the chain, said in an interview," We chose to rely on it. "

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