Mc Inflation and or Mc Ripoff?

[Hellek]

While I am not a fan of McDonald's (except for it's burnt, watery coffee) the reason for the higher prices is the following:

All persons employed "en blanco" in Argentina in retail stores belong to the Retail Employees Union, known as SEC (Sindicato de Empleados de Comercio). They get a monthly salary, plus full health benefits, unlimited sick days, a yearly bonus equivalent to a month's salary, paid study days (if they are in school), overtime pay, and if they are fired paid an indemnization of 1 months salary for each year they have worked for the company. These higher costs are the reason why generally all retail prices are higher in Argentina. McDonalds employees in the USA get a total of approximately $8 U$S per hour, no health benefits, no vacation pay, no bonus, just the $8 per hour and that is hard if not impossible to live on if you don't live at home with your parents and have 0 expenses.

In Austria people also get a lot of benefits and yet I hardly ever spend more then 5,5€ at McD (the 1$ stuff = 1€, the Menus are mostly around 5 or 5,5, which would be about 30 pesos). Above that, nobody expects you to clean up your stuff when leaving. Instead of waiting in line if they can't serve you immediately, they give you a number to put on your table and bring you your order, etc.
Something IS wrong with the prices of "Arcos Dorados"

PS: Of course your explanation is not wrong either. It explains part of the price, but not all of it. But well, probably they demand extra profit margin due to the risk/unpredictability. That might explain the missing part.

 

[Davidglen77]

While I am not a fan of McDonald's (except for it's burnt, watery coffee) the reason for the higher prices is the following:

All persons employed "en blanco" in Argentina in retail stores belong to the Retail Employees Union, known as SEC (Sindicato de Empleados de Comercio). They get a monthly salary, plus full health benefits, unlimited sick days, a yearly bonus equivalent to a month's salary, paid study days (if they are in school), overtime pay, and if they are fired paid an indemnization of 1 months salary for each year they have worked for the company. These higher costs are the reason why generally all retail prices are higher in Argentina. McDonalds employees in the USA get a total of approximately $8 U$S per hour, no health benefits, no vacation pay, no bonus, just the $8 per hour and that is hard if not impossible to live on if you don't live at home with your parents and have 0 expenses.

I personally don't mind to pay a small % higher than normal if I know the people working there are getting health coverage, have benefits that give them a better quality of life, etc. Even though the salarys are fairly low ($2.500 - $3.000 pesos per month) at least their basic needs are covered. That's a lot more than I can say for retail employees in the USA. I remember the cashiers at a popular drugstore in New York City where I lived - Duane Reade, were paid between $7-$8 U$D per hour, no benefits, no vacation and if you called in sick more than 1 or 2 times you usually ended up fired. And if they did get sick could any of them go to a doctor? NO because they had no health coverage and would end up in an emergency room for a common cold. I know this because there was a store in the office building where I worked and I used to hear these things all the time. In this sense Argentina "WINS" over USA policy 100 times in my book. This is also why I don't agree with people who insist so much on how they got this and that cheaper in the "chino", where most are employed en negro, have no benefits, etc. If you feel you got a "bargain" well it was at other people's expense.

 

[citygirl]

The funniest part is that the big mac is not listed on the menu, but does exist and the combo is for 21 pesos. The quarter pounder combo is roughly 50% higher at 32 pesos.

Rumor has it that the government asked them to take it off and keep the prices low to artificially adjust the Bic Mac Index.

Now that is fascinating to me.

I actually stopped in McDonalds the other day to get a diet coke. The guy in front of me ordered food for himself, his wife and kid. The bill came to 97 pesos. At McDonalds!

 

[argsteve]

Forget the Mac... head to Burger King for the new BK stacker combo... 5 meat patties...... like 42 pesos or something.... probably stop your heart but might be worth it?? haha
But yes I always walk by those places and wonder why is anyone eating a burger combo at McDonalds for 40-50 pesos...
Now if there was a Taco Bell for those drunken Saturdays.. now you would be talking!!!

 

[Matt84]

Forget the Mac... head to Burger King for the new BK stacker combo... 5 meat patties...... like 42 pesos or something.... probably stop your heart but might be worth it?? haha
But yes I always walk by those places and wonder why is anyone eating a burger combo at McDonalds for 40-50 pesos...
Now if there was a Taco Bell for those drunken Saturdays.. now you would be talking!!!

quiet sure I can have a fine saffron risotto and a glass of white wine on a dressed table for a figure within the new MCD ballpark.

 

[stefano]

Here Mc Donalds is not seen as junk food or fast food but rather status food.

That type of thinking is a huge mistake and will result in huge waistlines. I know, I live in California and when I drive by a McDonalds most of the patrons I see are 'supersized'.

 

[elhombresinnombre]

The funniest part is that the big mac is not listed on the menu, but does exist and the combo is for 21 pesos. The quarter pounder combo is roughly 50% higher at 32 pesos.

Rumor has it that the government asked them to take it off and keep the prices low to artificially adjust the Bic Mac Index.

You need to compare the burger-only prices. The Big Mac Index takes the burger-only price, including any and all taxes (ie not necessarily the price on display in some countries but the price actually paid)

Incidentally, I could hardly believe what you were alluding to about government interference but a little footling around with Google comes up with this 'rumour' in several places - including The Economist site!

 

[Philsword]

I think even with the benefits being paid as David mentioned the cost of this stuff seems high. Labor costs are still a fraction of those in the U.S. It seems to me somebody is just making more profit per burger. Maybe the government should look into these burger barons and make them cut their prices?

 

[bigbadwolf]

I think even with the benefits being paid as David mentioned the cost of this stuff seems high. Labor costs are still a fraction of those in the U.S. It seems to me somebody is just making more profit per burger. Maybe the government should look into these burger barons and make them cut their prices?

Labor cost in fast food restaurants is typically about 20% of sales revenue in the US. Must be less in Argentina since I doubt the fast food workers are paid the equivalent of USD 8 an hour. The explanation for the high prices probably lies elsewhere -- rampant inflation? I'm staggered to hear of prices in the 30-40 peso range. When I was last in Argentina in 2006, a meal at McDs or BK was only about 12 pesos (USD 4) -- roughly half the cost of a meal in the US. Now it's more expensive than the US.

Incidentally, I saw the same phenomenon in Panama, where McD and BK prices were roughly comparable to their prices in the US -- but their workers were paid about USD 1 an hour.

 

[Caz]

On the bright side of course cigarettes are definitely cheaper - but when it comes to good scotch or pipe tobacco I would have to say the prices are right up there with back home...