Fast food joint Wendy's to implement "Surge Pricing"
(archive.is)
You're viewing a single comment thread. View all comments, or full comment thread.
Comments (72)
sorted by:
I'm gonna start this by saying that I've observed more price increase in fast food since 2020 than I had in all my years previous. Now it's apparently gotten so bad that the traditional means of disguising price increases aren't working and fast food joints are coming up with "clever" (read: "retarded") ways of disguising their price increases. Wendy's has decided that they're going to increase prices (because I guarantee the baseline pricing for this isn't going to be lower than current prices by more than a few percent) based on demand fluctuations throughout the day.
This makes sense (to some extent) in an Uber where the service you receive during a "surge" is likely to have higher associated "costs" for the driver (traffic, namely) and you're on your phone getting a quote before accepting the service, allowing the "surge pricing" to act as a means of smoothing demand and compensating the driver for additional labor.*
With fast food, unless the majority of your customer base is ordering through an app, the service received is completely incomparable. It costs the same in materials and labor to make a burger during high demand as it does during low demand (and I'd argue it probably actually costs less during high demand since you can make multiple burgers at the same time with less labor than if you spread that same number of burgers out over a longer time.) And as far as I know fast food chains generally don't implement increased compensation for employees based on working during high-demand hours (they just try to have more employees available during these times), so compensation for labor isn't part of the increased price.
For fast food, increasing prices during a "surge" also isn't going to smooth the demand curve, it will just lower it. People aren't going to plan ahead to adjust their mealtimes with fast food, they'll just pick another option. Why even go into a Wendy's for lunch if you don't know what the price will be? Just go to the Burger King across the street.
I can't think of anything I've seen this dumb in the fast food sector ever.
*I don't actually use Uber so I'm making some assumptions about how specifically they implement surge pricing.
It’s not quite equal because good Fast food branches will increase the number of employees during those “surge” times as well (lunch time, dinner, etc).
Now the cost has to be averaged over the whole day but if you can surge the price by 50 cents during lunch they can offer 25 cents less during lower times.
In a pre-COVID world where people still went to offices and ate out for lunch this would work. Not so much today.
Frankly they don’t even need ai for this, let alone computers. Places used to do this by hand with separate lunch and dinner prices.
Lunch and dinner prices make sense when you make food to order, not when it's made by assembly line. Fast food was invented specifically to undercut sit-down restaurants.
Fast food assembly lines allowed them to deliver at scale better than regular restaurants, true. But lunch and dinner prices (as well as different/restricted menus) are practiced by both types for the same reason, economics. McDonald's franchisees hated having all day breakfasts even though corporate insisted it brought in more people and that only reverted when Covid came along. My local McDonalds has certain items that are only available during prime business hours and not after a certain time. The prices have also been changing on at least a weekly basis if not more often as the price for my Saturday breakfast burrito habit keeps changing. Honestly - I can't see Wendy's or any other restaurant truly implementing "surge" pricing and this is just a euphemism for intra-day price changes to get on the buzzword bingo chart, with AI tossed in for good measure. How's it going to work with 20 people in line and person #9 gets his burger for $5 but person #10 gets charged $9 for theirs and poor person #20 gets charged $13!!
Except that makes no sense. They make a lot more money during peak hours - it's more expensive compared to profit to stay open during the slow hours, because costs stay roughly the same while income falls dramatically. Their best profit hours are the same hours they want to increase prices on, they just think everybody is fucking stupid.