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List: Posted: 08/09/11
McDonald’s may be the biggest fast food chain in the world, but that doesn't mean that they’re immune to increases in commodity prices. The chain will likely be raising its menu prices in the near future. However, McDonald’s won’t be the only company that will have to increase their prices to offset the increasing prices for the commodities they depend upon.
McDonald’s has been the dominant hamburger restaurant worldwide for many decades. The increases in prices at McDonald’s will likely be mirrored at its competitor restaurants, such as Wendy’s and Burger King. This is simply because it costs the chains more to produce their products, due to increases in the price of pork, beef, wheat and the other ingredients they depend upon. According to reports, McDonald’s doesn't plan on passing the full brunt of these increases along to their customers, but even they cannot avoid small rises, if they are to remain in business.
Aside from McDonald’s, you may see price increases at your favorite grocery store and other sit-down restaurants. When food prices rise, it affects all of the different businesses that depend upon them. McDonald’s customers may not see a significant increase in the price of their meals, but expect sporadic jumps.
Between the various fast-food restaurants, don’t expect competition to have much effect on prices. While you may think of other fast food chains as the main competition for McDonald’s, fast food chains generally see themselves as being in competition with the food you buy at the grocery store, not with other fast food restaurants similar to themselves.
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