Rising rents and costs of raw materials cited
McDonald's will be getting pricier in the future. Hong Kong’s teenagers are skeptical about the price increase at McDonald’s.
McDonald’s raised prices at its Hong Kong stores by two per cent on Tuesday amid rising costs, in what an industry expert said was a prelude to more of such moves from the world’s largest fast-food chain.
The restaurant line increased its prices in the city by HK$0.60 to HK$1.50 on menu offerings, which include extra-value breakfasts, extra-value meals, happy meals, and some individual food items and drinks.
Rising operating costs from increased rents and higher ingredient prices prompted the move, according to a statement from the company.
“McDonald’s Hong Kong understands the pressure on citizens from inflation, and did its best to limit the impact on food prices when considering price adjustment,” the company said.
Snehaa Senthamilselvan Easwari, a Li Po Chun United World College student, agrees with the price increase. “Although I’m surprised because the prices have been consistent for a while, they were bound to go up one way or another. In comparison to any food chain/food stores in Hong Kong, McDonald’s pricing is very reasonable and affordable. With the costs of production, rent, and electricity rising - this step is almost inevitable,” said Snehaa, 17.
Nicholas Ng, a South Island School student, disagrees.
“The relatively cheap food they provide is unfortunately a key source of nutrients for many Hongkongers who may not be able to afford healthier meals. Raising prices only means that these people may struggle to fill their stomachs, worsened by the fact this trend in price increase is expected to continue,” said Nicholas, 15.
Snehaa feels the same about helping those in need. “I hope that the company can still price it within a reasonable range that is affordable to lower-income families. I know many people consume McDonald’s frequently due to its pricing, and for many in Hong Kong it's between starvation or unhealthy food. In terms of that McDonald’s, it does provide a closure to hunger so I hope it can still provide to those that may really need it,” she said.
The price rise was relatively milder this year compared with the past two years – in January and December last year, the chain raised prices by 2.3 to 2.5 per cent.
However, Simon Wong Ka-wo, president of the Hong Kong Federation of Restaurants and Related Trades, said there would be more to come from McDonald’s.
“Considering the rise in rents and wages, its overall operating costs should rise more than 2 per cent for the past year,” Wong said. “There is a possibility of gradual price increases in 2018.”
This came after what could be the best year for restaurants in the city since 2012, as the sector saw an upward trend in demand from both local residents and tourists.
“The overall economy was doing well in 2017, and the number of mainland tourists also picked up,” Wong said. “Citizens were more willing to spend on luxury goods and dining.”