Here come the price increases!

[ClownLoach]

At Chick-fil-A today because I had a free sandwich b coupon. Basically the entire menu went up $1. A plain sandwich is $6.49. Medium fry $3.49. Large drink $3.99.

[storewanderer]

For the Original in CA I'm seeing a floor price of 6.35 in Auburn and a ceiling price of 6.85 in Los Angeles.

Most locations are 6.49 from Roseville to Fairfield (used to be 3 different price scales along that territory) and down to Bakersfield.

So this appears to be cutting down the number of price zones.

Same price in Daly City as Fresno, 6.49. Never seen that before. Great way to screw over the consumers in lower income parts of the state.

But great higher royalties for the franchisors statewide! Another win for the big corporations. Way to go!

[ClownLoach]

For the Original in CA I'm seeing a floor price of 6.35 in Auburn and a ceiling price of 6.85 in Los Angeles.

Most locations are 6.49 from Roseville to Fairfield (used to be 3 different price scales along that territory) and down to Bakersfield.

So this appears to be cutting down the number of price zones.

Same price in Daly City as Fresno, 6.49. Never seen that before. Great way to screw over the consumers in lower income parts of the state.

But great higher royalties for the franchisors statewide! Another win for the big corporations. Way to go!

Staffing is also slashed to the bone. Employees look frustrated, exhausted and unhappy. Zero of the normal CFA friendly. Yelling through the kitchen which never happened before.

[pseudo3d]

For the Original in CA I'm seeing a floor price of 6.35 in Auburn and a ceiling price of 6.85 in Los Angeles.

Most locations are 6.49 from Roseville to Fairfield (used to be 3 different price scales along that territory) and down to Bakersfield.

So this appears to be cutting down the number of price zones.

Same price in Daly City as Fresno, 6.49. Never seen that before. Great way to screw over the consumers in lower income parts of the state.

But great higher royalties for the franchisors statewide! Another win for the big corporations. Way to go!

Staffing is also slashed to the bone. Employees look frustrated, exhausted and unhappy. Zero of the normal CFA friendly. Yelling through the kitchen which never happened before.

I imagine this is because of extensive staffing redirected to drive-through, which is only cannibalizing dine-in and not sustainable.

[storewanderer]

For the Original in CA I'm seeing a floor price of 6.35 in Auburn and a ceiling price of 6.85 in Los Angeles.

Most locations are 6.49 from Roseville to Fairfield (used to be 3 different price scales along that territory) and down to Bakersfield.

So this appears to be cutting down the number of price zones.

Same price in Daly City as Fresno, 6.49. Never seen that before. Great way to screw over the consumers in lower income parts of the state.

But great higher royalties for the franchisors statewide! Another win for the big corporations. Way to go!

Staffing is also slashed to the bone. Employees look frustrated, exhausted and unhappy. Zero of the normal CFA friendly. Yelling through the kitchen which never happened before.

What is the issue with the employees? They appear to have cut down on how many employees are on duty so "wage expense" stays the same? So as a result the employees are all getting less hours per week? That probably won't last long once they get the quasi-union thing going which will ensure minimum number of hours for the employees. By then assuming these places are even still in business because by then there will be another round of price hikes driven by inflation, there should be enough attrition that the employees still there will have enough hours.

Chickfila probably needs to move to order kiosks and self serve drinks.

I haven't heard "my pleasure" at the Reno Chickfila since 2020. They finally solved the odor issue inside though. That took a couple years.

I'll be interested to see how this effects In N Out. If this turned Chickfila into being understaffed and unhappy that is very bad. Chickfila I used to consider the gold standard of fast food operations (NOT anymore). For me they were right up there with In N Out in terms of quality of operation but they seem to have really fallen down in operational quality. I'd rather have Popeyes chicken from a taste perspective and rather have a Steak N Shake burger/fries from a taste perspective but the quality of operations out of those two just aren't the same.

[ClownLoach]

Looks like Del Taco has started their increases. I noticed the giant "Over 20 items $2 and under Menu" ad signs were all removed last week. Looks like half those items went over the $2 mark. A single "The Del Taco" went from $1.79 or $1.89 (two closest restaurants were a dime apart in pricing) to $2.29. The puny Snack Taco has broken the dollar mark and is $1.09.

Similar to Chick-fil-A, drinks and fries are taking the brunt of the price increases. Small fries have moved off the value menu where they were two bucks and shot straight to $2.79, medium $3.19 and large $3.49. Drinks the exact same cadence, $2.79, $3.19, $3.49.

More important, both used to save you a bit on a combo but it does not appear to do much more than round off the spare change now. Medium #1 combo was in the $7s within the last 18 months depending on the franchisee, $9.79 today.

I think I'm going back to the days of putting an ice chest in my car and packing sodas and water. Not going to be paying $4 after tax for a drink. Or going to Circle K or somewhere that charges 99 cents for a massive size then just order the entrée at fast food places.

Not my favorite source and lacked specificity, but Fox Business had an article I won't link that interviewed a restaurant owner who said their McDonald's franchisee is closing 4 of their 7 restaurants permanently due to this. Looking for more details plus I am not sure what happens if you close your McD's franchise, they might have the right to take over immediately and reopen then refranchise so it's possible nobody will notice anything. If the article had any specifics like location I would have linked it. If there are lots of franchisees who are going to reject their franchise then this could turn into a costly exercise for the corporate parents if they have to take over a lot of locations with these high pay rates.

There was another good discussion about this on the radio. They said that a fast food worker who has decent hours and hits this new $20/hour job is going to potentially lose on a tax credit for low wage earners. And that the state is likely to take in a significant tax haul from these raises. So really the joke is on everyone who was picketing for these big wages, because most of the raise is going out the door to the IRS and FTB as soon as it becomes anything close to a "living wage" negating the entire activity. Although I'm sure a qualified tax accountant might question some of the figures or scenarios posted I am not surprised. Always funny how the minimum wage goes up but the standard deductions and tax brackets don't move anywhere near as quickly, if at all...

[ClownLoach]

For the Original in CA I'm seeing a floor price of 6.35 in Auburn and a ceiling price of 6.85 in Los Angeles.

Most locations are 6.49 from Roseville to Fairfield (used to be 3 different price scales along that territory) and down to Bakersfield.

So this appears to be cutting down the number of price zones.

Same price in Daly City as Fresno, 6.49. Never seen that before. Great way to screw over the consumers in lower income parts of the state.

But great higher royalties for the franchisors statewide! Another win for the big corporations. Way to go!

Staffing is also slashed to the bone. Employees look frustrated, exhausted and unhappy. Zero of the normal CFA friendly. Yelling through the kitchen which never happened before.

What is the issue with the employees? They appear to have cut down on how many employees are on duty so "wage expense" stays the same? So as a result the employees are all getting less hours per week? That probably won't last long once they get the quasi-union thing going which will ensure minimum number of hours for the employees. By then assuming these places are even still in business because by then there will be another round of price hikes driven by inflation, there should be enough attrition that the employees still there will have enough hours.

Chickfila probably needs to move to order kiosks and self serve drinks.

I haven't heard "my pleasure" at the Reno Chickfila since 2020. They finally solved the odor issue inside though. That took a couple years.

I'll be interested to see how this effects In N Out. If this turned Chickfila into being understaffed and unhappy that is very bad. Chickfila I used to consider the gold standard of fast food operations (NOT anymore). For me they were right up there with In N Out in terms of quality of operation but they seem to have really fallen down in operational quality. I'd rather have Popeyes chicken from a taste perspective and rather have a Steak N Shake burger/fries from a taste perspective but the quality of operations out of those two just aren't the same.

I need to check the new build CfAs that just opened nearby but I think they have self service drinks now except lemonade and tea. Could be wrong so don't quote me until I confirm it.

I heard an interview with the founder of Raising Cane's explaining the chicken situation. It's pretty simple. Americans eat chicken on about a 2 to 1 ratio versus beef. But hamburger fast food alone outnumbers chicken places 4 to 1. So they see a nearly unlimited ceiling to open chicken restaurants because we have too many burger places and not enough chicken.

Here is where I see a problem. CfA now usually has a Cane's within a block or two, if not directly across the street or even next door. Cane's is taking some of their volume for sure. Couple that with rapid expansion of CfA itself and the cannibalism of the sales of each location when another opens and takes half the business. If I had to guess, I'd say some of the oldest CfA units are down 75% in sales to their peak when they were the only game in town.

As they work to correct this chicken to burgers ratio, they're going to get diminishing returns and reduced sales volume. That means now they have to cut staffing back as the restaurant doesn't need as many workers, the remaining ones have to wear more hats, and now they're less happy. Couple that with hours cuts and higher expectations due to the pay rate change and you've got a even bigger mess. That's why you're not seeing the execution you once did at CfA. The growth is slowing and the competition is catching up.

The other issue is that In-N-Out seems to be able to scale up and down when they add additional locations to a market without negatively impacting service or food quality. CfA has not demonstrated this ability. I think most In-N-Out locations were already hiring at $19 or $20 in the last year so I expect few changes in price or service unless they decide they want to take an activist approach and fight this law... And if anyone would attempt it, it would be In-N-Out...

[storewanderer]

Looks like Del Taco has started their increases. I noticed the giant "Over 20 items $2 and under Menu" ad signs were all removed last week. Looks like half those items went over the $2 mark. A single "The Del Taco" went from $1.79 or $1.89 (two closest restaurants were a dime apart in pricing) to $2.29. The puny Snack Taco has broken the dollar mark and is $1.09.

Similar to Chick-fil-A, drinks and fries are taking the brunt of the price increases. Small fries have moved off the value menu where they were two bucks and shot straight to $2.79, medium $3.19 and large $3.49. Drinks the exact same cadence, $2.79, $3.19, $3.49.

More important, both used to save you a bit on a combo but it does not appear to do much more than round off the spare change now. Medium #1 combo was in the $7s within the last 18 months depending on the franchisee, $9.79 today.

I think I'm going back to the days of putting an ice chest in my car and packing sodas and water. Not going to be paying $4 after tax for a drink. Or going to Circle K or somewhere that charges 99 cents for a massive size then just order the entrée at fast food places.

Not my favorite source and lacked specificity, but Fox Business had an article I won't link that interviewed a restaurant owner who said their McDonald's franchisee is closing 4 of their 7 restaurants permanently due to this. Looking for more details plus I am not sure what happens if you close your McD's franchise, they might have the right to take over immediately and reopen then refranchise so it's possible nobody will notice anything. If the article had any specifics like location I would have linked it.

I do not understand why these chains do not understand what an issue drink pricing is and how it upsets/annoys customers. 2.99 for a fast food drink is simply too high. Wendys still has a 16oz drink at .99 here and Jack in the Box has a 16oz drink at 1.79 (just increased) but you cannot order either on the app/kiosk, only at the cash register.

The basic Del Taco is .99 in Reno so not much different. But I see they still have a 1.49 Iced Tea 28oz but CA locations reverted that to the soda price.

There are certain gas stations who will sell you a "cup of ice" at a very low price. Any size. The corporate Chevron units were doing this at .35 as of around Christmas. Corporate Speedway (not express) at 39 cents but now that they are on 7-Eleven system that may not be an option anymore. Less convenient but the truck stop chains Loves/TA 50cents and Pilot 65cents. In my area for the cup of ice Maverik is 50cents any size and the Jacksons units have a weird scale of prices for a cup of ice depending what cup you use (smallest coffee cup may be about 20 cents but largest soda cup is like 65 cents).

[storewanderer]

I need to check the new build CfAs that just opened nearby but I think they have self service drinks now except lemonade and tea. Could be wrong so don't quote me until I confirm it.

I heard an interview with the founder of Raising Cane's explaining the chicken situation. It's pretty simple. Americans eat chicken on about a 2 to 1 ratio versus beef. But hamburger fast food alone outnumbers chicken places 4 to 1. So they see a nearly unlimited ceiling to open chicken restaurants because we have too many burger places and not enough chicken.

Here is where I see a problem. CfA now usually has a Cane's within a block or two, if not directly across the street or even next door. Cane's is taking some of their volume for sure. Couple that with rapid expansion of CfA itself and the cannibalism of the sales of each location when another opens and takes half the business. If I had to guess, I'd say some of the oldest CfA units are down 75% in sales to their peak when they were the only game in town.

As they work to correct this chicken to burgers ratio, they're going to get diminishing returns and reduced sales volume. That means now they have to cut staffing back as the restaurant doesn't need as many workers, the remaining ones have to wear more hats, and now they're less happy. Couple that with hours cuts and higher expectations due to the pay rate change and you've got a even bigger mess. That's why you're not seeing the execution you once did at CfA. The growth is slowing and the competition is catching up.

The other issue is that In-N-Out seems to be able to scale up and down when they add additional locations to a market without negatively impacting service or food quality. CfA has not demonstrated this ability. I think most In-N-Out locations were already hiring at $19 or $20 in the last year so I expect few changes in price or service unless they decide they want to take an activist approach and fight this law... And if anyone would attempt it, it would be In-N-Out...

In Reno and Sparks there are two locations where Raising Canes and Chickfila operate within about a mile of each other. All of these units are packed with customers and over capacity. There are also 2 dead KFC units located in close proximity to these; they were pretty slow before Raising Canes and Chickfila opened but now they are just completely dead.

I am not sure we will see the chicken to burgers ratio corrected in fast food. The burger chains have more to offer, sell breakfast, etc. Yes Chickfila has breakfast but it seems like they've almost forgotten about it. As these chicken chains so used to high volume open too many units in the future and those units are lower volume and have execution issues, customers will leave. Suddenly the ROI isn't what it once was.

Chicken is a lot more common in fast casual and ethnic environments (Asian, Mexican, etc.) also whereas a big chunk of those do not even slot ground beef products. So don't think it is as simple as the number of chicken fast food vs. number of burger fast food ratio means the chicken fast food chains have unlimited expansion potential. Chickfila and Raising Canes have had an incredible run. Everything has a lifespan.

It isn't very hard to find boneless skinless chicken breasts at 1.99/lb in a supermarket. Just like it has been for years. For a while in 2022 etc. it was not happening and even 2.99/lb was a good deal but prices have come down a little lately or stores have better ads, not sure. Yet these chicken fast food chains have increased prices 40-50% in the past 5 years. At some point the price gets too high. Raising Canes wants 9.89 for a 3 piece/fry/drink in Reno; that is just too much and the size of the Raising Canes tender is much smaller than it was when they opened in Reno. You have these wild Popeyes franchisees in NorCal who want $15 for a 3 piece tender/side/drink/biscuit... I can't believe they even stay in business.

[veteran+]

This all makes me smile.

More than half of these fast food places can disappear and we would all be the better for it as a society.

So the franchisees can handle this new overhead? Good, close up. Perhaps non fast food sit down restaurants will do better.