While customers love the dollar menu at fast food restaurants like Wendy’s, the store itself may not be as big a fan. In fact, many other fast food restaurants like McDonald’s and Taco Bell are also looking for ways to boost the bottom line while leaving the value menus that customers love. For restaurants, the dollar menu is very much a double-edged sword.

The Value of the Dollar Menu

The actual purpose of the dollar menu at a Wendy’s location is to encourage customers to spend well over one dollar. Order a single burger for a dollar and then add a drink and a side and suddenly you’ve spent closer to $5 rather than the $1 you might have been planning on shelling out. This is the hope, of course. In reality, there are many customers who manage to spend only a dollar or two per visit using the menu, ultimately hurting profits in the long run.

To help move customers into higher spending brackets, the dollar menus at Wendy’s have changed a bit to encourage customers to think of $2 and $3 items as values as well. The Dollar Menu is now the “Right Price, Right Size Menu” carefully jumbled to mix the one dollar items in with the three dollar items for maximum “value” spending.

The company realizes however, that customers aren’t a huge fan of the shift away from the true $1 value menu. “We know our Right Price, Right Size Menu is not a sufficient value proposition to continue to attract value-seeking consumers,” Wendy’s CEO Emil Brolick acknowledged recently in an interview.

Bringing Back the Specials

But Wendy’s can’t seem to let go of the super cheap pricing all together. After all, that is what customers are drawn to. To this end, Wendy’s has also introduced specials like “4 for $4” where customers get a Jr. Bacon Cheeseburger, a small fries, a four-piece chicken nugget and a small drink for only $4. While each item technically only costs $1 in the quartet, the customer leaves the restaurant having spent $4 in a bundle – better than just $1 at least.

In fact, most fast food restaurants are shooting to get customers to spend $5 on a meal. A full meal for $5 means customers are getting a terrific value and stores are still making a profit. It’s considered the sweet spot in fast food. Or it is for now.

Another fast food giant, Burger King, recently warned the public that raising minimum wage for fast food workers could easily destroy the dollar menu at all fast food restaurants. The fast food chains simply won’t be able to meet the payroll selling $1 hamburgers.

Source:

http://time.com/money/4071870/fast-food-dollar-menu-wendys-4-for-4/

Wendy’s Reviews:

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