McDonald’s is launching a new value meal to respond to this awful situation

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McDonald’s is trying to remain the leader in value in the age of rising prices.

The fast-food giant wants to find a way to get customers back in the door.

Now McDonald’s is launching a new value meal to respond to this awful situation.

Fast food industry reeling as customers cut back from high prices

Food prices have surged during the inflation created by President Joe Biden.

The price of food is up more than 20% since he took office, well past the normal inflation rate.

That’s forced fast-food restaurants to raise their prices which is pricing out some of their customer base.

McDonald’s and other major chains warned that low-income customers are buckling under the weight of inflation.

“It is clear that broad-based consumer pressures persist around the world,” McDonald’s CEO Chris Kempczinski said on an earnings call. “Consumers continue to be even more discriminating with every dollar that they spend as they faced elevated prices in their day-to-day spending.”

After weaker than expected earnings, Kempczinski vowed that McDonald’s had to be “laser-focused on affordability” because of how price-sensitive consumers have become. 

Gone are the days of dollar menus at fast food chains and value menus carry items that cost as much as $4.

That’s forcing many consumers to reassess their fast food spending. 

An $18 Big Mac at a rest stop in Connecticut generated an avalanche of bad headlines for McDonald’s on social media.

Now the fast food giant is trying to create a new value meal as part of Kempczinksi’s promise. 

McDonald’s is trying to lure cost-conscious customers with a new $5 value meal

McDonald’s is getting ready to launch a new $5 combo meal to get customers in the door.

Bloomberg reported that the combo meal could include a McDouble or McChicken along with fries and a fountain drink.

The $5 combo meal was previously rejected by franchisees who own about 95% of the chain’s locations.

McDonald’s franchisees pay royalty fees to the company and get a vote on promotion campaigns.

Franchisees are leery of the $5 combo meal because of rising labor costs, especially in states like California, which raised the minimum wage for fast food workers to $20 an hour.

Coca-Cola is being recruited by McDonald’s to help pay for the promotional deal, which would help ease costs for franchisees.

McDonald’s franchisee John Palmaccio told Bloomberg News in a statement that McDonald’s, suppliers, and franchisees are working together to provide “great value and affordability” and that “our customers really need it.”

Kempczinski said on the earnings call that McDonald’s was falling behind its competitors in national promotions focused on values.

Burger King is running a $5 promotion for two Whopper Jr.’s and Wendy’s is offering two breakfast sandwiches for $3.

A McDonald’s franchisee group urged the company to bring back its beloved snack wraps because they’re “craveable, relatively simple to produce” and would “easily satisfy the call for more affordable options on the menu.”

Value is gone in fast food and McDonald’s is scrambling to find a solution for inflation-weary consumers.