Beef price spike makes $1 McDouble harder to stomach

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Grand Master

Hum

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(Reuters) - McDonald's popular $1 McDouble cheeseburger, which has lured customers to the Golden Arches since 2008, is getting hard to sustain as rising beef prices threaten the company's profit margin.

The world's biggest restaurant chain launched a competing $1 Grilled Onion Cheddar Burger in December. It also made the new sandwich - with one beef patty rather than the McDouble's two - a star of current television commercials, a status it shares with the McDouble.

The dilemma for McDonald's Corp (MCD.N) restaurant operators is that the McDouble has the highest ingredient costs on the Dollar Menu, making it a bad financial proposition unless customers add high-margin sides such as french fries or soda.

"If the McDouble is all the customer buys, you lose money," said Richard Adams, a former franchisee who now advises the chain's restaurant operators. "Depending on what happens to beef prices, McDonald's management should be open to taking the McDouble off the Dollar Menu."

The decision would be a significant one. McDonald's gets 10 to 15 percent of its sales from the Dollar Menu and experts say the McDouble is one of the most popular items on it.

Many franchisees, who pay royalties to the parent company based on overall sales, have exercised their option to move the McDouble off the Dollar Menu by raising its price over $1.

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Grand Master

Sir Topham Hatt

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In the UK, the double cheeseburger is actually ?1.49.

Hamburgers used to be 59p, cheeseburgers were 69p, but since the invention of the "pound saver menu", the double was always ?1.29, steadily rising by 10p every 6 months/year to the ?1.49 it is now.

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Grand Master

Astra.Xtreme

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It's not just beef prices rising, it's everything that depends on corn. Going to see rising food costs across the board this year all because we use corn for fuel.

This is true. Here in the US, we had a horrible drought this past summer which ruined crops and forced farmers to sell off livestock.

So we all knew here that prices of meat and produce would go through the roof.

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Grand Master

game_over

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In the UK, the double cheeseburger is actually ?1.49.

Hamburgers used to be 59p, cheeseburgers were 69p, but since the invention of the "pound saver menu", the double was always ?1.29, steadily rising by 10p every 6 months/year to the ?1.49 it is now.

I've definitely had a 99p double cheese burger (plain, of course).. it didn't last long though i think it went to ?1.19.

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I am Reid

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the ratio of soy to beef is just going to get higher. I hate nothing more than when I go to buy just a regular box of burgers at the store, see it says "Beef patties", and only to find out when I get home that yea its beef, as well as half soy. All the people who claim you cant tell the difference when soy or turkey is substituted for beef are idiots. Now I either buy the ground beef myself and make the patties or only buy frozen ones that say specifically on the box "100% beef", and list only beef under its ingredients.

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Grand Master

DirtyLarry Veteran

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Many franchisees, who pay royalties to the parent company based on overall sales, have exercised their option to move the McDouble off the Dollar Menu by raising its price over $1.

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My local McD's asks $1.99 for the McDouble. So yeah, not really a $1 menu item any more. :laugh:

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techbeck

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Dairy, grain, and meat all will be more expensive this year...should drop next year tho. 2012 was not a good year for farmers. Bad drought and many crops didnt make it. Farmers also slaughtered a lot of their live stock because they could not afford to feed them. So the end of last year, everything was a little cheaper. So its going to be an expensive 2013.

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DAOWAce

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It's fine, they'll just use less meat than they already do and find ways to make it feel and taste like meat. Most of their food is over 50% filler anyway; people eating it shouldn't expect to live healthy lives.

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Grand Master

+Gary7 Subscriber²

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the ratio of soy to beef is just going to get higher. I hate nothing more than when I go to buy just a regular box of burgers at the store, see it says "Beef patties", and only to find out when I get home that yea its beef, as well as half soy. All the people who claim you cant tell the difference when soy or turkey is substituted for beef are idiots. Now I either buy the ground beef myself and make the patties or only buy frozen ones that say specifically on the box "100% beef", and list only beef under its ingredients.

I buy Ground Sirloin that is ground in front of me so I get no soy. Bubba Burgers are kind of good though. Have no idea what is in them..

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techbeck

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people eating it shouldn't expect to live healthy lives.

Depends on how much of it you eat. If you make it a daily habit, then yea. But every now and then wont hurt anything. I will not ever have their chicken nuggets after I saw that it is made out of pink slim. Grossed me out. I mainly just go their for their fries...as long as they are fresh. But again, I maybe go there a couple times a month. If that.

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FloatingFatMan

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Depends on how much of it you eat. If you make it a daily habit, then yea. But every now and then wont hurt anything. I will not ever have their chicken nuggets after I saw that it is made out of pink slim. Grossed me out. I mainly just go their for their fries...as long as they are fresh. But again, I maybe go there a couple times a month. If that.

How can you tell they're fresh? McD's fries are non-biodegradable!

As for their McNuggets.. I don't know about in the US, but in the EU they're made from chicken breast. They have to be by law or they can't call them chicken. :p

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techbeck

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How can you tell they're fresh? McD's fries are non-biodegradable!

As for their McNuggets.. I don't know about in the US, but in the EU they're made from chicken breast. They have to be by law or they can't call them chicken. :p

Do a search pink slim chicken nuggets. And fries are fresh when they are piping hot and have some crispiness to them. You can also tell by taste.

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HawkMan

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the ratio of soy to beef is just going to get higher. I hate nothing more than when I go to buy just a regular box of burgers at the store, see it says "Beef patties", and only to find out when I get home that yea its beef, as well as half soy. All the people who claim you cant tell the difference when soy or turkey is substituted for beef are idiots. Now I either buy the ground beef myself and make the patties or only buy frozen ones that say specifically on the box "100% beef", and list only beef under its ingredients.

And yet in the other thread, americans complain about how useless labeling of the contents of stuff at the super market is and will just increase the price of products.

Personally I've never seen burgers I buy at the store that are anything but near 100% meat. But then we have labeling requirements and people wouldn't buy burgers or burger meat that didn't say it was 50% beef and 50% plants.

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