McDONALD’S will charge more for Happy Meals and at “high-demand” stores, including at the Royal Children’s Hospital. Most of the outlets where prices will rise are in the city and working class suburbs, because McDonalds believes those consumers are more likely to accept the higher charges, while diners in more affluent areas would complain. The cost of menu items was previously based on restaurant overheads and ingredient prices. 
But the multinational fast-food chain is now using socio-economic factors to determine charges under a new “demand-based pricing” scheme.
A confidential corporate document seen by the Australian Herald Sun reveals McDonald’s Australia has identified an “opportunity to introduce more aggressive price increases” at 52 of Victoria’s 214 outlets.
Melbourne’s CBD restaurants on Collins, Elizabeth, Swanston and Bourke streets will be among those to charge the highest prices.
The Royal Children’s Hospital, Melbourne airport and select restaurants from areas such as Airport West and St Albans through to country Victorian restaurants in Traralgon and Echuca will all be hardest hit.Suburbs such as Werribee and Avondale Heights and country towns such as Benalla will only incur moderate increases.A McDonald’s franchisee, who asked to remain anonymous, said the biggest price rises were concentrated in low-income areas.”If you take the time to analyse the different restaurants, in general the poorer suburbs will pay more,” the franchisee said.
“In essence, areas that the franchiser thinks will pay more for our products will have to. This is so wrong.”
The document says the objective of the new system is for individual stores “to maximise the potential for a price rise” while minimising the risk consumers that will go elsewhere or choose a cheaper meal.The biggest price rise will be for children’s Happy Meals, which will increase by 16.5 per cent from $4.25 to $4.95, at all locations.Other items will rise in two stages by between 1.8 per cent and 3.3 per cent, depending on the location of the restaurant.
McDonald’s corporate communications manager Bronwyn Stubbs denied the prices were forced on franchise owners.”The company’s licensed restaurants have always, and continue to have, the power to set their own pricing based on individual factors,” she said.
