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Quality versus Price

The economic struggle is causing the fast food chains to lower their prices even further making many people think that the US is officially in the gutter. Fast-food chains such as McDonalds, Burger King, and Wendy’s have been lowering the “bar” of food pricing which in turn causes the consumers to think that the quality of the product has gone down with it. I personally believe that this is just something that people are seeing as a sort of “scapegoat” instead of facing reality and seeing that maybe it has always been this low of a quality and the fast food chains are actually just trying to bring in more customers rather than selling them “miscellaneous spam” because they are getting too cheap.

Many fast food places, according to Lisa Scherzer of The Exchange, “contend with increased competition, cost-conscious consumers and a still-uncertain economy, they’re trying to outdo each other by slashing prices ever more in the hopes of getting customers through the door. But some franchisees are grousing, suggesting those rock-bottom prices are getting too cheap for their comfort.” This has always been a given in the business world as companies compete with each other by changing up their pricing, but for their customers to start thinking that the lower prices mean otherwise is a big problem for all the businesses. I think that businesses should be a bit smarter and use this thought to their advantage, an example being the $1 menu at McDonalds. McDonalds knows that people are always going to look for fast cheap food, and during these economic times they knew that they could attract more business by creating the incentive of having a menu in which almost anyone can afford to buy. The economic efficiency was a success in their $1 menu as more and more customers gathered to their restaurants, however as the fast food chains caught on and did the same, the only thing left to do was to lower the prices of their main items; a mistake all the franchises would regret. Though the law of demand states that the lower the price of an item the more consumers would buy it, it also states that if it is too low many people will overlook it.

As the ‘invisible hand’ did its business, the fast food chains realized what was going on with their customers and decided to start bringing back their regular prices that finally brought back their regular amount of customers. This was shown in McDonalds as their “sales trend was up 7.7% in January 2012 (for the U.S.), 11.1% in February and 8.0% in March (Scherzer).” Now all the fast food franchises are relying on promotional goods and are thinking about the opportunity costs of their customers as they decide whether to buy their food because it is cheaper or because the value is respectable to the price, meaning that the customers either buy low quality versus quality that is decent and fair to the price. Honestly, as a customer I would think that if a business is trying to hard in getting people to buy their food then that business is going in the gutter, however if a business does it without shoving commercial after commercial in a person’s face all the time then that business must be thriving more than the rest. So in conclusion, fast food franchises need to keep the bar constant since they are already a low standard of food, and people need to realize that what they are buying is not necessarily bad in quality rather it is not as good as homemade or restaurant food.

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