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When You Say You Get It, But You Clearly Don't
Many consumers are thinking carefully about how they spend every dollar, with some cutting back on visits to quick-service restaurants, as executives told investors on a series of earnings calls last week. To win penny-pinching customers back, some say they’re planning smaller price increases for the rest of the year.
Several fast-food chains described a gloomy outlook. The chief financial officer of Wendy’s, Gunther Plosch, told investors on Thursday that consumers were “still under pressure” — especially those with household incomes under $75,000. “They are reducing frequency, so visitation is down,” he said.
Chains raised prices drastically during the pandemic to offset rising labor and food costs, and it’s coming back to bite them. Some diners are cutting back, saying fast food is too expensive and no longer represents good value.
OK, so…the headline of this article is…
Fast-food chains are getting the message about soaring prices
And one of the first statements is…
To win penny-pinching customers back, some say they’re planning smaller price increases for the rest of the year.
So your plan to win back customers who dislike how high prices have become is to…
…continue to raise prices.
More slowly, but still. Raise.
Are we all that dumb? Number cannot forever go up. Number can drop. Number can stay maybe. But Number does not always go up.
Lower your prices, provide a better experience for employees and customers alike, and people will flock to your restaurants.
“Oh, our profits aren’t high enough!”, you’ll cry. But profits you’ll still have. And in this economy, that is your win.
Wednesday May 8, 2024