Will a Fast-Food Chicken Surcharge Be a Thing?

Will a Fast-Food Chicken Surcharge Be a Thing? ...

This year, for those seeking to save money, hasn''t been a pleasant one.

First, visits to refill your gas tank have become a bad realization of how much supply and demand are affected in our daily lives.

In many areas of the United States, pumps increased by more than $4 per gallon, while West Coast states such as California recorded prices as high at $6, causing some to leave their automobiles in their driveways and seek additional modes of transportation.

Third, visits to the local grocery resulted in empty shelves where the products we''re most familiar with are usually served.

For example, grabbing an avocado to make a quick guacamole became an errand you might have to visit multiple grocery stores to accomplish. And even after that, there was a possibility you still might go home alone.

Non seulement were some foods difficult to find, but the costs of the goods improved. According to Goldman Sachs economists, the rate increased by 11% over the past two years, with a projected 5% to 6% increase in 2022.

Now you might have to get a little extra than you''re used to at yet another venue: the fast-food drive-through.

Noodles & Co.

What''''s More Expensive at the Drive-Through?

On April 28, pasta company Noodles & Co. (NDLS) - Get Noodles & Co. Class A Reports indicated that it would add a $1 surcharge to all chicken dishes in order to alleviate the rising costs of poultry.

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Chicken costs in Q1 were 30% higher than they were a year earlier, according to Chief Financial Officer Carl Lukach. More than half of the Broomfield, Colo., chain''s customers order chicken, putting a serious issue on the company''s expenditure.

Lukach stressed that the surcharge was "one-time and relatively short-lived" as the market is expected to normalize quite soon.

Will Other Fast-Food Chains See Increases?

The food industry is dealing with the effect of inflation on the whole. The National Restaurant Association reports that menu prices have increased by 4.9 percent in the last 12 months, while grocery prices have increased by 10% year over year.

Noodles & Co. is one of the many companies working to reduce inflationary imbalances. Following an earnings call where Starbucks (SBUX) - Get Starbucks Corporation Reportfell short of its Wall Street forecast, the coffee chain announced a price increase for its menus later this year.

Get Chipotle Mexican Grill, Inc. Reportmade a similar announcement in its March earnings call, when Chief Financial Officer John R. Hartung said "inflation on beef and freight and, to a lesser extent, avocado costs more than offset the value of our menu-price rises."

Get McDonald''s Corporation Reporthave yet to announce a price rise, but it''s possible it will be next, as it has stated that it''s also dealing with higher costs.

"We saw an increase of 3% in food and paper costs in 2021, and this increase is expected to double in 2022," said the company''s executive vice president and chief financial officer.

Several businesses have tried other methods than raising their rates to counteract the increased costs.

Buffalo Wild Wings, founded by Inspire Brands, has focused its promotions on boneless wings rather than bone-in due to pricing, while Wingstop (WING) - Get Wingstop, Inc. Reportand BJ''s Restaurants, Inc. Reportnow offer chicken thighs on their menus.

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