McDonald's Probably Will Hike Prices

The fast-food chain will increase the price of some menu items because of rising beef costs, among other food price increases.

January 26, 2011

OAK BROOK, IL - McDonald€™s Corp. revealed this week that higher menu prices will be coming on some items, the Los Angeles Times reports. The fast-food chain pointed to increases in beef costs and other foods as the reason for the hikes.

The cost of cheese, chicken and wheat €" McDonald€™s most-used ingredients €" is expected to increase 2 percent to 2.5 percent in 2011. "As commodity and other cost pressures become more pronounced as we move throughout the year, we will likely increase prices to offset some but not necessarily all of these cost increases," said Pete Bensen, the chain€™s CFO.

Bensen mentioned that any price hikes would not be on every menu item, just on select ones to keep its menu a good value for consumers.

The burger restaurant is not the only chain or independent foodservice establishment predicted to advance prices this year because of soaring commodity costs. Technomic predicts restaurant prices will jump 2.5 percent to 3 percent in 2011. Grocery stores also have increased prices on food products. Major food manufacturers, such as Kraft and Sara Lee, will be raising prices this year.

"The expectation is we're going to have higher commodity costs, and restaurants are going to have to pass along some of those," said Ron Paul, president of Technomic. "Consumers are already seeing them in grocery stores, so it's not going to be a surprise."

Advertisement
Advertisement
Advertisement