shine trader live reports:
The supply chain crisis and the rise of raw materials are transmitting to the downstream consumer catering. According to the latest news on October 28, McDonald’s said that it would raise the menu prices of American restaurants due to the pressure of rapidly rising costs. In addition, some other chain restaurants in the United States have publicly said that they have raised prices to make up for the loss of rising costs.
The key point of the rising price tide in the United States is still the supply chain crisis. The latest data show that the congestion of major ports in the United States continues. Goldman Sachs estimates that the two ports of Los Angeles and long beach alone have a backlog of $24 billion (about 153.5 billion yuan) of goods, and the congestion may continue until at least mid-2022.
In order to solve the problem of port congestion, the Biden government issued a new policy: from November 1, Los Angeles port and Long Beach port will charge the shipping company a surcharge of $100 / container for overdue containers transported by truck and railway, and an increase of $100 / container per day.
The more serious problem is that the recovery momentum of the US economy is becoming weaker and weaker. On the evening of October 28, the data released by the Bureau of economic analysis of the U.S. Department of Commerce showed that the annualized quarter on quarter growth of real GDP in the third quarter of this year was 2% lower than the initial value, lower than market expectations, and the slowest growth rate in more than a year.
Trillion restaurant giants will also raise prices
McDonald’s can’t bear this round of price rise.
On October 28, according to the Chinese website of the Wall Street Journal, the American fast food giant McDonald’s said it would raise the menu prices of American restaurants to keep up with the rapid rise in costs. So far this year, the wages of employees in American restaurants alone have increased by at least 10%.
McDonald’s cost pressure mainly comes from two aspects: one is the rising wages of American employees; The other is the rise in the prices of raw materials, paper and other supplies.
According to the internal executives of McDonald’s in the United States, since the second quarter, the average salary of McDonald’s American restaurants has been rising, with an average increase of more than 15%, and McDonald’s is still facing recruitment difficulties even if it increases its salary.
In addition to wages, McDonald’s prices of food raw materials, paper and other supplies are also rising. According to McDonald’s executives quoted by foreign media, McDonald’s commodity costs are expected to increase by 3.5% to 4% this year.
Obviously, the overall rise in labor wages and supply chain prices has brought great pressure to McDonald’s. McDonald’s expects that the price on the menu will rise by 6% compared with 2020.
On the eve of the news of price increase, McDonald’s disclosed the latest performance data. Its revenue in the third quarter of this year was US $6.201 billion, a year-on-year increase of 14.6%; The net profit in the third quarter was US $2.15 billion, a year-on-year increase of 5%, both exceeding market expectations. After the announcement of the financial report, McDonald’s share price soared continuously, rising by more than 3.8% in two trading days, and the latest total market value rebounded to US $183.3 billion (about RMB 1171.6 billion).
Compared with rising costs, McDonald’s in South Korea is facing a more severe supply chain crisis. According to local media reports, the lettuce in McDonald’s restaurants in Seoul, South Korea is out of stock and in short supply. There is no lettuce in the hamburgers purchased by consumers, which once boarded the hot search in South Korea.
Downstream consumer giants began to be forced to raise prices, which means that the global supply chain crisis is still fermenting, and the costs in fields such as global distribution, freight transportation, fuel and food are increasing.
In addition to McDonald’s, other food and beverage consumption giants have also begun to raise prices to offset the rise in wages and the rise in the cost of meat, packaging, vegetable oil and other commodities.
Starbucks said on Wednesday that it would raise the average hourly salary of American employees from $14 to $17, but recruitment was still difficult. In addition, the world’s two major daily chemical giants, P & G and Unilever, have also announced that they will increase the prices of some beauty, beauty and oral care products due to cost pressure; PepsiCo also said earlier that the shortage of beverage bottles, the rise in the price of raw materials and the shortage of truck drivers… The challenges from the supply chain are increasing and may raise the price again in early 2022.
Chain restaurants including Mexican restaurant chipotle Mexican Grill, del taco restaurants and chili have publicly said that they have raised prices to make up for the loss of rising costs.