If your morning coffee run feels more expensive lately, you’re not imagining things.
A recent study by FinanceBuzz reveals that breakfast prices at popular fast-food chains have soared by 53% on average since 2019, with some items seeing much steeper increases.
The report highlights how inflation, labor costs, and subtle pricing strategies have transformed breakfast from a budget-friendly meal to a pricier affair.
Breakfast price hikes outpace inflation
FinanceBuzz’s study, which examined 10 major fast-food brands, found that breakfast menu prices have climbed well beyond the overall inflation rate of 23% since 2019.
The study did not include coffee but focused on popular breakfast items such as egg sandwiches and bagels.
At certain chains, like Taco Bell and CKE Restaurants (parent company of Hardee’s and Carl’s Jr.), prices for breakfast items spiked by as much as 72%.
Subway and Starbucks experienced lower increases, with breakfast costs rising by 37% and 32%, respectively, but these hikes still outpaced inflation.
The most startling rise was seen in hash browns. The price hike for that item was as high as 149% at Jack in the Box and ranged from 23% to 110% at other establishments.
Across all chains, hash browns were 77% more expensive on average compared to five years ago.
Cost pressures force fast-food chains to pass expenses on to customers
The breakfast price surge can be traced partly to the economic strains affecting the industry, according to experts.
Inflation in food commodities like potatoes and eggs has directly impacted the cost of breakfast ingredients.
Meanwhile, rising labor costs are hitting chains particularly hard during morning hours when customers expect quick service.
“The operator may require more staff to meet the needs for speed,” Arlene Spiegel, a New York-based restaurant consultant said in a report by MarketWatch.
Breakfast customers are also seen as reliable, if price-tolerant, patrons.
Mark Kalinowski, an analyst who follows fast-food trends, suggests that chains may feel more comfortable raising breakfast prices because morning diners often stick to their habits.
“The operator can take advantage of the fact that it’s your morning ritual,” Kalinowski noted in the news report, suggesting that price hikes may go largely unnoticed by those in a rush to get their day started.
Another reason breakfast hikes appear sharper is the traditionally low cost of breakfast items, making even small increases appear significant on a percentage basis.
A small price increase on a low-cost item like hash browns shows up dramatically percentage-wise.
Source: FinanceBuzz
Breakfast inflation outpaces lunch as fast-food chains test limits
Interestingly, FinanceBuzz’s study found that breakfast prices are rising faster than lunch or dinner items at some chains.
Chick-fil-A’s breakfast items, for example, have jumped 56% in the past five years, compared to a 44% rise in lunch and dinner items.
This trend suggests that breakfast may be facing its unique pressures, with operators relying on breakfast’s loyal customer base to absorb more significant hikes.
Not all chains are following this trend.
McDonald’s, which faced backlash over rising main-menu prices, saw a reverse scenario: its non-breakfast items went up by 80%, while breakfast prices increased by 54%.
Can fast-food chains keep raising prices?
Despite these hikes, some industry experts warn that chains may need to tread carefully.
Steve Zagor, a lecturer on the restaurant industry at Columbia University and New York University, cautions that fast-food restaurants risk pricing customers out of breakfast.
“Some customers are just making those eggs at home,” he pointed out in the MarketWatch report, highlighting how DIY breakfasts offer a cheaper, if less convenient, alternative.
Starbucks CEO Brian Niccol recently announced the company’s decision not to increase menu prices in North America through fiscal year 2025.
“It’s a great start, but we have more work to do to make our pricing architecture straightforward and logical,” he stated.
McDonald’s recently introduced a $5 value meal with options like a McDouble cheeseburger and fries to counter complaints over rising prices.
While fast-food chains have been rolling out value meals to lure customers back for lunch and dinner, they may eventually need to consider similar strategies for breakfast.
Whether breakfast promotions will follow remains to be seen, but Zagor suggests that chains must balance profitability with customer loyalty.
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