> [Graph] - The most efficient merchant charges the optimal price for each customer - the highest each customer is willing to pay.

The graph doesn't show that - it actually shows how to maximise revenue while offering a single price point for all customers.

In reality, this isn't the optimum way to pick a price though - because you probably want to optimise for profit rather than revenue (and these price points aren't likely to be the same).

> [There are multiple items at different price points, and...] It struck me, though, that this was an excellent example of optimal pricing

I wouldn't call this pricing actually - I would call this ranging.

Pricing is the exact pounds and pence put against an item, while ranging is the idea of offering different products and services to meet different segments. Mr Monopoly Man might not want a $1 hamburger, but might settle for an ultra-mcdonalds-premium-delux, so ranging that higher-end product helps the company appeal to wider demographics.

But 'having different products and making them different prices' isn't usually considered a pricing strategy.

really not sure where you can buy those items for a dollar, and if you can find them, not sure you should eat them.

I want these under $1 tasty chicken patties.

What specific PRODUCT at Costco are you saying both taste good while costing under $1/ea?

Or you can get it hot with a drink for $1.50.

Frozen pack of chicken Pattie's is cheap

Mayo

Head of lettuce is a dollar

You can't make one sandwich cheap but you can make eight cheap

This is just one of many things wrong with this article that I had high hopes would explain how to find the optimal pricing, but really just shirks that research off.

> Then again, most successful major corporations are run by heartless conservatives. The companies run by bleeding-heart liberals all went out of business.

Ok, maybe save me the time on the article and put winners like this at the top next time.

It is a lot easier now that I have four people to feed, although the issue now is more that our two kids are insanely picky eaters and it is so hard to find meals everyone can eat.

So I end up just not buying bread for the house.

There’s something to be said for the economics of moving enough volume to enable eating fresh.

I really wouldn't want to eat frozen french fries either, they are just really bad. Might as well make something more edible as a side like macaroni salad.

I guess my point is that only if you're making food for a large family or are a really big eater then the supermarket is cheaper. Otherwise, don't feel bad for "wasting" money at McDonald's. I don't have a horse in this race though, I'm a vegetarian, I don't eat this stuff.

And that's real chicken, not reconstituted shit.

A kilogram of fries is like £1.

You'd have to likely cut, tenderize, and bread the breasts before shallow frying in a pan and heat up some oil to fry the fries/chips in. The patties and prepared chips can just go in the oven while you wait.

Do what you want, but be honest about it.

and buying at small quantities can be even double that.

if you were comparing price of mcdonalds chicken burger to a plainish chicken breast, the 2 arent the same at all, which the previous poster was commenting on.

to turn that raw chicken breast to something close to McDs chicken burger requires quite a bit of time and additional ingredients.

on the fries, i agree. you can buy a KG of shoestring fries for 2-3$, with some salt are the same as mcd fries for the most part

if doing a raw ingredient comparison, buying at scale of 1KG is definitely cheaper.

https://abcnews.go.com/Lifestyle/mcdonalds-reveals-beloved-f...

It would be cheaper, not more expensive, to pad it out so that you end up with like 50g of chicken and 50g of bread or whatever.

are you arguing there is no point to transformative cooking to make something diff as it would be lesser than it originally was?

thats like saying why bother trying to make an apple pie, when you can just eat apples.

also your proportions are whack, have you had a breaded chicken burger? for the most part its externally coating the chicken breast patty with a breading/seasoning mixture and frying it.

you arent padding the meat mixture like say a meatloaf.

A McD's burger has hardly any actual chicken. You need to compare like for like. The cheap ones are even made from mechanically recovered meat.

An apple pie is cheaper than apples.

What are we even talking about? This is just funny.

Prices may have change recently.

I would write employee names on the receipt and give glowing reviews of individuals. Apparently, managers would read the reviews aloud to their teams, so I got creative.

The kind you are most familiar with is the quantity discount from buying a larger package size at the grocery store.

Price discrimination happens when it's the same product sold at different prices (e.g. senior discount for movie tickets) - but actually there IS a difference between a $1 burger at McDonalds and one of the $7 premium ones.

I think the canonical example is actually coupons.

Or if I want a tasty treat I'd get the free McCafe with any purchase and get an apple pie. $1.50 for espresso drink and a dessert?

And all those purchases add up for reward points.

Their deals change all the time and the above mentioned aren't there anymore as exactly mentioned, but there's a 6 piece Nuggets for $1 minimum purchase...

I also know I'm not the only one who does this for "optimal" pricing as one time at the drive through I hit the wrong coupon, the cashier rattled off the price before inputting my code...and had to correct himself when the price came up and looked at me dumbfounded wondering why I didn't optimize my order.

Bonus: They have fast Wifi (though I do tethering for security reasons) and power outlets.

Some of the McDonald's I have been to are fairly empty. Like maybe a customer or two in a hour. This is the US where everyone is curbside picking his fat meal. Your workplace is being essentially subsidized by these guys, since the math would not make sense for the place.

The author might be saving money, but they’re also probably going hungry.

For example:

- BigMac: 550 Cal, 30g Total Fat, 25g protein, 45g carbs

- McDouble: 400 Cal, 20g Total Fat, 22g Protein, 33g carbs

So you're saving 30% calories, while only losing 12% of protein.

https://www.mcdonalds.com/us/en-us/product/small-french-frie...

Also, not everyone wants to spend 30 min extra to save $2. I guess he acknowledges this at the end but it’s only after berating dumb people for shopping poorly the whole post.

Yes, the largest margin is in the drinks. Mostly municipal water.

The fries are in the middle. Potatoes are cheap; there's some prepraration that goes into the final product but it's still just one ingredient and pretty minimal labor in cooking and serving.

The sandwiches have the lowest margin. Multiple ingredients from different vendors, and the most labor to cook and assemble.

The McChicken patty is about 2.5oz before cooking. I see the cheapest chicken breast as $3.49/lb on Instacart, so a bit cheaper in person, but that would be $0.55 for the chicken.

Of course, it still is cheaper to make food at home. A chicken patty, a bun, and some lettuce and mayonnaise cost maybe a dollar or so overall. A small handful of frozen fries, far less than a buck. You just have to take the time to put it all together, which we usually do. Making food at home is the ultimate price point for stingy folks, and our default mode of operation (and one reason you can retire on a lot less than you think - my next blog entry).

There's nothing in there about needing to buy food one meal at a time, and if you're trying to live cheaply to retire sooner you're likely buying relatively large packages and freezing/refrigerating across multiple meals.

1/4 lb tri tip is a great sandwich for about $1.5

We buy chicken under $2, pork under $3, and beef under $4.

As a result, many vegetables are more expensive per lb.

Why do so many websites insist on using such small font sizes? I zoomed in to 200% to read this comfortably... It's awful having to do this all the time.

More expensive than optimal -> not enough sales, driving profit down.

Be us a large-ish family ordering 5 hamburgers and 2 Chicken Crips (a chicken burger). Wife gets a full meal set because she is loved. Total cost of about 1500yen, or 12usd. For an extra 70yen you can supersize the fries.

But by bit I up the number of hamburgers. I think my record is 8. I am waiting for the day they refuse my order. An individual hamburger is quick to make, but order enough and you could exhaust the stock of cooked patties. If I remember right it's ten patties per tray. With two trays in rotation. Thus a single order of 20 hamburgers could cripple the production line for 5+ minutes.

They happily filled the orders. It didn't take that long at all. We would do this just about every week.

i have to always ask for my food made "fresh", otherwise you run risk of getting "old" food. the one closest to my house is always slow, wait 5+ minutes for old food... or wait 10-12 minutes for "fresh" (quarter of the time we still have to complain about it being old/dry).

i know plenty of people who do this always, so i guess always backing up the line. really i dont think it backs up much anything as most mcdonalds appear to be overly staffed with people doing nothing at times standing around.