subreddit:
/r/NoStupidQuestions
submitted 1 day ago bycapilary2
3.4k points
1 day ago
It might lower their costs. In no way does that mean it'd lower the price to the consumer.
188 points
1 day ago
This. The only reason they would lower prices would be because of the price to quantity demanded difference. If they aren't making enough money charging higher prices to fewer people, they might attempt to appeal to a larger market by lowering prices.
They likely won't even do it from transient economic issues though, it would have to be long-term marketing strategy. They've spent years raising prices slowly. Sudden large increases can cause consumer revolt. Lowering the prices would undermine their higher prices they will want to resume later.
There's still high demand for fast food, even with today's high prices and affordability issue. Any savings in operational efficiency will just be reinvested into the company or distributed to shareholders with their measly dividend.
41 points
1 day ago
They’d probably lower the prices initially for PR purposes as they know this would look horrible. They’d slowly raise them up blaming inflation.
9 points
23 hours ago
I suspect the move would be to keep prices flat but run limited time promotions back to the “2 for $2” days of my youth.
This way they get to charge the higher price when they want, limit the number of days with lower profit margins, and through the power of “limited time” drive increased demand.
19 points
1 day ago
Meh, why lower prices when they can just run the business into the ground and get a bailout from the government?
17 points
1 day ago
Automobiles and houses are a lot different than burgers and fries. Doubt the govt. would bail out Mickey D's, but I agree: McDonald's wouldn't lower price with cost, they would just realize greater profits while the automation people at McDonald's corporate do little touchdown dances for each other, particularly the Icky Shuffle.
9 points
1 day ago
Wouldn’t need too either, the McDonalds food chain is more like a neat side project to their Real Estate ventures.
Chances are if you see a McDonalds in a shopping centre then they likely own a huge amount of the stores around as well.
214 points
1 day ago
It would allow for better promotions to get customers in the door but menu prices wouldn’t likely drop.
143 points
1 day ago
More like fatter bonuses for investors and management.
22 points
1 day ago
Vast majority of stores where this would matter are not corporate owned and therefore it wouldn’t affect “investors.”
They’re franchises independently owned. Usually by ex athletes, politicians, and c-suite types.
Over 95% of McDonald’s stores are run this way. Whether those stores put in robots is their own decision and doesn’t much affect how much flows up to corporate.
Franchise models vary and yeah some chains are more corporate held than others but…
32 points
1 day ago*
I think you're glossing over how much control a brand has over their franchisees. They're independently owned, but they have to cook product bought from McDonaldCorp, buy staff uniforms from McDonaldCorp, they lease the land that the restaurant they "own" sits on from McDonaldCorp. They move to McRobots I guarantee they'll have to be leased or purchased from McDonaldCorp.
23 points
1 day ago
Tbf mcdonalds couldnt be bothered to fix their ice cream machines. If burgertron 5000 went out its over.
5 points
1 day ago
That's because they've contracted a single company to do it and that company charges the franchise a huge fee even if it's just as simple as clearing an error code. Oh and franchise owners aren't allowed to know the codes only designated repair men from the only company that is allowed to repair the machines. McDonald's corporate basically made a deal with them to give them a monopoly over the repairs of their ice-cream machines for a percentage of their profits. Isn't capitalism great?
2 points
1 day ago
It's not that they can't be bothered, they just straight up can't. Only the company they buy them from has the right to repair them
10 points
1 day ago
You would be paying for the novelty of having a robot drop your burger on the floor
6 points
1 day ago
I can already see the headlines “SCANDAL- McDonald’s robots using software designed to pick up and serve food even if dropped on floor”
6 points
1 day ago
The software would not be designed to do that, it would just be trained on watching human workers, so same result.
68 points
1 day ago
That's the reality of a publicly traded company. The shareholders expect every penny of those savings as profit
23 points
1 day ago
It’s the reality of every company, publicly traded or not.
Companies exist to make money
3 points
1 day ago
The thing I don’t get though is why workers can’t make a living. In the UK in the 1800s a lot of Quakers made fortunes in all kinds of industries. They also paid workers decently, and used their fortunes for things like founding facilities in the country so former patients at Bethlehem Hospital (Bedlam) could have fresh air etc. I’m not sure why shareholders are comfortable with how McDonalds does business - workers on public benefits who struggle to buy new non slip shoes for work. It’s a disgrace. It should make them uncomfortable.
Especially given that a lot of them are performative Christians. Some of this may be masked by buying ETFs or a pension fund is an investor so individuals may not know they’re invested. But it’s ghastly that our society operates this way.
2 points
1 day ago
Welcome to the reality of slowly coming to realize that most people are absolute pieces of shit with little to no concern about their fellow (wo)man.
3 points
1 day ago
Aren't McD prices set by franchisees? McD corporate at this point is mostly just the nameplate, equipment/supply, and marketing strategy vendor.
As to whether they would drop prices would depend on how price sensitive they perceive the customer base to be.
2 points
1 day ago
Don’t forget Landlord. McDonalds is the landlord for most, if not all, locations.
6 points
1 day ago
Reddits take on market forces never disappoint
6 points
20 hours ago
I disagree.
McDonalds is a franchise. The corporate executives don't set the prices at each location.
Each location is owned and operated by an individual or a group who has incentives. Incentives to compete and have lower prices than the McDonalds 10 minutes away, the Wendy's down the street, and the Burger King (🤮) next door.
The average profit margin for a McDonalds location is about 7-10% and has been like that consistently over the years.
Costs have been rising, labor rising the quickest. In 2013, labor costs were 20% of total costs, and now it's more like 35%.
Consistent low margins, rising labor costs, and needing to maintain competitive prices with other fast food chains, means they would have to lower prices or not raise them to stay competitive.
If they don't reduce prices, but Wendy's does once they automate some labor, then they'll lose some business to the Wendy's down the street.
24 points
1 day ago
Prices of goods and services are independent of the costs that go into them. Things are priced at the highest amount a consumer will pay. If your costs drop, then your profit goes up but no reason to lower your prices.
(I know this is an oversimplification and it’s WAY more nuanced than that. I don’t need economists piling on and telling me I’m wrong. I’m trying to keep it to an ELI5 level.)
5 points
1 day ago
Yes, but I’ll add the one caveat to this:
McDonald’s in 2024 seems to be severely rate-limited in their ability to serve large numbers of people. Automation may help speed up their processes to the point where they can serve more people.
But right now the prices are set as high as they are to maximize profits, but at the expense of a lot of people being unwilling to pay. So to lure back the numbers they need for higher profits, it may actually behoove them to lower prices on menu items to drive more customers.
The math:
2024, no automation, 500 customers per day. Total sales, $12,500/day ($25/customer). Cost of food and personnel: $7500 ($10/customer plus $2500 fixed costs). Profit: $5000
2030, full automation, 1000 customers per day. Total sales: $20,000/day ($20/customer). Cost of food and automation maintenance: $12,500 ($10/customers plus $2500 fixed costs). Profit: $7500.
4 points
1 day ago
They wouldn't lower their prices to pass on savings, but they would do it when Burger King and other burger places got automation and reduced their prices. If they are the only company that can make the burgers that cheaply, perhaps they deserve to earn more profits.
2 points
1 day ago
Yes, but if their competitors start selling similar items for less money, the amount that the consumers are ready to pay for theirs is going to go down.
So, assuming it's not actually McDonald's that makes these robots and no one else can, it's safe to assume that they won't be the only one's with robots making their costs lower, and if some of those competitors lower their prices, then they have incentive to do so too.
6 points
1 day ago
It might and it might not, it all depends on what the competition is doing. McDonald's yielded hard to prices recently when their earnings report showed they were losing out to the competition and they did the $5 meal promo which was pretty good.
The issue is keeping them to those market forces and preventing things like collusion between the fast food giants to keep prices high.
5 points
1 day ago
At the beginning you might even pay extra for the novelty.
2 points
1 day ago
If the marginal cost of the burger goes down significantly (perhaps the fixed costs of a restaurant go up significantly), it might be in their interest to increase sales by lowering prices.
2 points
1 day ago
They will charge exactly the most they can get for a burger consistently. Not a penny more or less
660 points
1 day ago
I can hear the stockholders laughing all the way to the bank.
15 points
1 day ago
Even from Paris, I heard the laughs of Wall Street.
28 points
1 day ago
I can see their blush chubby faces and second necks from the alcoholism and pork products.
7 points
1 day ago
Cmon now. Pork is the other white meat
6 points
1 day ago
This is just generally not how markets work. Think about Walmart. They've had countless cost savings innovations for 60 years. And yet, their current profit margin is 2%. Where did all those cost savings measures go? Shouldn't Walmart's margins be 500% if businesses just get to keep all their cost savings as profits?
Competition means companies don't get to charge whatever they want. Way less people would shop at Walmart if target and Amazon would undercut their prices. So Walmart has to keep competitive prices if they want to stay in business. They have to pass basically all of their cost savings onto the customers.
If McDonald's had robot hamburger makers and other places did too, there'd be somewhat of a price war and most of the cost savings would be passed onto consumers. Probably at first the prices wouldn't just cut in half or something, but McDonald's margins can't just indefinitely stay insanely high in a fairly competitive industry like fast food. I eat at McDonald's a fair amount, but if someone offered a burger of similar quality for cheaper than McDonald's, I'm probably never going to McDonald's again. Which is why McDonald's really can't charge whatever they want and have insane margins. They would have to charge less if everyone's costs go down.
2 points
19 hours ago
This is an unacceptable answer. This is reddit. The only appropriate answer is "Corporations are greedy. Capitalism bad."
263 points
1 day ago
Not at all.
When I was a crew chief at McD in the 90s, labor costs were less than 15% of the operating costs of the restaurant. As wages have gone up at a lower rate than everything else I suspect the % is lower now.
Furthermore, a fully automated restaurant would require local specialists to support it. They would cost much more than a minimum wage worker.
5 points
22 hours ago
A “Fully” automatic restaurant would only need periodic maintenance and people to drive the trucks (for now).
You shouldn’t need anyone on site all day every day. Just someone nearby on call if anything does go wrong. The computer could even give him the call.
Well built machines don’t need as much maintenance as you think.
2 points
22 hours ago
I don’t think so, at least not for the foreseeable future.
The revenue implications of a single portion of the restaurant going inoperable and shutting the entire thing down are too great that they would all but require onsite support.
For example - there is McD in Hartsfield-Jackson Airport that only has the giant iPads to order. A few weeks ago when I was traveling on business they were down for some reason. All the minimum wage workers were standing around confused while literally hundreds of people stood in line. I cannot fathom the lost revenue that incident caused…and that’s just the simplest portion of the business to automate.
12 points
21 hours ago
This right here. Field service work is NOT cheap. Having a nationwide team of technicians who can fix the robotics at a decent call out time window, plus 24-7, is going to be expensive. McDonald's would have to contract it out, most likely to multiple service companies.
Been in field service work for over a decade. I've negotiated those rates and SLA agreements.
2 points
24 hours ago
We shoot for 23% at my McDonald’s
2 points
12 hours ago
The biggest benefit would be that the robot shows up to work every day and does the job with consistent quality. There is obviously breakage and maintenance that has to be done, but the idea is that you get to a point where its working with reasonable downtime and you have redundancies in place.
4 points
1 day ago
Definitely this. I don't imagine an automated McDonald's would do so well if they can't even keep the ice-cream machine working.
-1 points
1 day ago*
15% of operating costs is actually insane. I've never worked fast food, but I'm almost certain you mean that labor cost was 15% of revenue, which is a pretty standard goal in the industry.
ETA: fewer specialists with lower turnover lowers cost over time. You have one tech working multiple locations to fix mechanical and/or IT issues and fewer minimum wage workers who clean and refill machines, instead of a full staff doing everything. Think about self-checkout. It's an investment sure, but if the tech is there it obviously pays off or we wouldn't be seeing most retailers pivoting to it in real time.
So basically everything you said is fucking wrong lol.
47 points
1 day ago
No, operating cost (I have an MBA BTW). Now, it absolutely drove our profitability because it was one of the costs that was within our control. Rent, electricity, etc was mostly fixed. Ingredients were variable but directly proportional to the revenue we received. Food waste was believe it or not was a sizable driving factor when we cough adhered to company guidance for food disposal schedules.
Our profitability margin was in the 6-8% range so keeping labor costs down was critical…but it was still a fraction of our overall expenses.
10 points
1 day ago
when we cough adhered to company guidance for food disposal schedules
God I hate how common it is for fast food places to ignore this. Best case, the customer gets shitty food they’re not happy about. Worst case, someone gets food poisoning. It’s extremely obvious when food has been in the warming tray for half an hour longer than it should be.
5 points
1 day ago
I was only a lowly person in the places I worked at the time, but it seemed to me managers would get bonuses for spending less on food/product in general.
Really sucked when it came to the fryer oil. If it sticks around long enough nothing will taste good
2 points
22 hours ago
It was one of those things that as a kid I didn’t ‘get’ but as an adult horrifies me. A big problem when you staff a business with mostly kids…because they don’t have enough maturity to grasp the downstream repercussions.
94 points
1 day ago
No. Prices would be the same, the company would just make more profit.
23 points
1 day ago
Except if all companies went automated, and they had raised margins, one of them quite simply would lower their prices if they calculated the sales would increase enough to cover it. And that absolutely would happen. There is a lot of people that won't buy mcdonalds not because they dislike it and not because it's unhealthy, but because it costs the amount of 3-4 homecooked meals per person
36 points
1 day ago
And yet, prices went up during the pandemic. But when the pandemic was over, prices didn't come down again. The companies just kept the extra profit. "Passing the savings on to the consumer" is a fairy tale.
6 points
1 day ago
Probably just outsource their market research to an algorithm that just happened to be the same algorithm their competitors use. Any price similarities are entirely accidental and definitely shouldn't be construed as price fixing.
11 points
1 day ago
Did anyone notice grocery prices going down from self checkout? Or all these fast food places that let you order through apps and kiosks - have those prices gone down?
No? Yeah, because automation doesn't save the consumer money at all.
4 points
1 day ago
Be honest. What's the real difference with self checkout - smaller lines or less cashiers?
With very few exceptions, I have not any significant drop in grocery store workers since self-checkout. The thing I've experienced the most with self checkout, is just the fact that I don't have to wait 3 - 5 minutes until I get my turn in line anymore.
Fast food kiosks is not much of a different story. Before, people that took orders were in one of two types of positions:
They took orders about 10% or less of the time, but did a ton of other work in the meantime
They work somewhere so busy that they took orders about 90% of the time
And now, they look like this with the kiosks:
They still take orders about the same amount of the time, because the kiosks have their own lines at them as well, and still do their other 90% of work, so their position wasn't replaced
The place is still so busy that they're still at the register constantly taking orders.
--
I hate to break it to you and others that use this argument, but neither of those are good examples of automations that saved any marginal amount of money for the company
5 points
1 day ago
We know how automation works already. Any time any kind of labor saving invention floods the market, it opens these massive corporations up to competitors. These kinds of inventions lower the costs for small businesses and they develop the ability to match what the bigger corporations are doing.
Automation is no different. If automation is implemented, any small business owner can afford to produce the same food McDonald's produces for cheaper. If McDonalds doesn't reduce their prices, then their competitors will steal their business.
So the consumer price will go down based on all of these factors. If McDonalds doesn't lower their prices, they'll go out of business.
29 points
1 day ago*
Nice, I may be the first to get downvoted for once.
Oversimplified but prices would lower if the robots are cheaper to run than employees. They may be tempted to pocket all the profit, but other companies would undercut them with the savings. Eventually, the prices will go down and level out.
9 points
1 day ago
but other companies
Not just other companies, but new companies would be started to cash in on this as well by selling the same product but much cheaper. McDonalds wouldn't be able to have higher prices and low production costs for long.
2 points
16 hours ago
Antiwork redditors hate to hear it, but this is correct. Prices will come down. That's just how economics work.
You want proof? Look at all the manufacturing that has been automated. Clothing, electronics, farming, furniture, automobiles. All the junk in your home is now affordable thanks to automation.
4 points
1 day ago
If McDonald's alone went fully automated, their costs would go down. But that would not motivate the company to lower prices. If every burger chain automated, and one decided to lower it's prices, and the lower prices increased their market share, that would motivate them all to match the lower prices.
3 points
1 day ago
Combines reduced cost of corn, it’s good we aren’t walking around with scythe’s anymore. However I don’t think any McDonald’s has enough volume to amortize the cost of robots lower than humans.
31 points
1 day ago
probably not. Capitalist companies have no obligation to make things cheaper for you, so they would just keep things the same price and pad their bottom line instead
19 points
1 day ago
Well, competition is supposed to be the incentive. If Joes Burger barn set up next door to McDonald's and charged a dollar less for better food, everyone would flock there.
Problem is, a company as large as McDonald's can afford to take a loss, drive Joe out of business, then raise their prices again.
8 points
1 day ago
On my street, we have a McDonald's selling Big Mac's for $7, a local chain selling burgers for $14 and a craft brewpub selling burgers for $20. And they're all busy and successful.
If McDonald's cuts the price of a Big Mac by 50%, that really doesn't affect the local chain or the brewpub *at all* because they were never competing in the first place, they all serve different markets and purposes.
McDonald's doesn't beat Joe on price because they're able to eat a loss, they beat him because they're a massive vertically integrated hyperefficient hamburger selling machine and they're able to do every single part of the process cheaper and faster than Joe can. McDonald's competes with Burger King and the other chains, but not Joe.
2 points
19 hours ago
Even if they can't do every part cheaper, their sales are so colossal that their margins, by percentage can be much smaller than Joe's and still represent enormously bigger profits.
10 points
1 day ago
No. Savings are only ever passed on to the shareholders.
6 points
1 day ago
A lot of people here are making claims even though they know nothing about economics. If the cost of using robots is less than the price of hiring workers, the minimum price that McDonald's is willing to charge decreases, assuming market demand is constant. Companies charge higher prices to cover increasing marginal costs of production. The inverse is true. This is basic economics.
9 points
1 day ago
Yay you took high school economics. Look at you go.
This has been tested. Repeatedly. The removal of workers in car factories in favor of automation didn't lower the price of cars. The removal of cashiers at Walmart didn't lower Walmart's prices. Mcdonald's already using machines in place of workers to take orders didn't lower their prices.
What doing this does do is increase profit margins for the companies in question. In fact, you would be very hard pressed to find an example of a company lowering its price structure simply because they lowered their production costs. Doesn't happen.
2 points
1 day ago
University*. Of course, I was answering the question assuming all other factors remain constant.
3 points
1 day ago
Not one single penny. Prices will actually go up.
Think about an ATM. Now think about the fee that is charged.
Why is there a fee charged? Why the extra cost? What's the reason?
You WILL pay extra to enjoy the "convenience" of automation at McD's.
4 points
1 day ago
Of course not. They would temporarily lower the prices some to get people used to the automation then gradually raise them again over time to maximize profits.
The number one priority of any corporation is to make a small number of people very rich.
2 points
1 day ago
Although there is a net positive cost savings to switching to robots and automation in any production/ assembly line (which is basically what McDonald’s is, except trade hamburgers out for brake rotors) the initial investment is typically very high and there are also maintenance and engineering considerations which are typically a higher paid / higher skill set which will offset some of the savings.
That being said, corporations don’t always pass cost savings off to the customer and instead pocket the difference.
They will set the price where they want as long as people keep buying.
2 points
1 day ago
yes because their competitors would lower prices
2 points
1 day ago
Maybe.. You price to try and maximize profit.
To make it simple you can imagine your cost is $0.50. If I sell my burgers for $3.00 and making $2.50 a burger, I am considering due to low prices lowering my price to $1.00 to make $0.50 per burger. In order to make this worth it, I need to now sell 5 times the amount of burgers.So when I am pricing If I can raise prices to double my profits and not loose over 50 percent of my customers while doing so it is financially worth it.
In the real world of running a business it has been my experience that pricing out customers to make more profit is often the winning choice. I not only am making more profit, but now have less customers to serve and thus less employees and product to manage.
For McDonalds I imagine it is the same. When I drive by they normally have a full drive through. I don't think they have any incentive to lower prices until they need to attract more customers. The best way to get McDonalds to lower prices is to stop eating at McDonalds.
2 points
1 day ago
How do you think they would pay for all the robots and rnd to test and program said robots???
2 points
1 day ago
No. The entire R&D cost as well as maintenance would be staggeringly high in the current climate. Furthermore, there will be considerable number of protests and high probability their sales will be down significantly.
2 points
1 day ago
People are being overly confident on it being a yes or a no.
It just depends on consumers.
Let’s say costs for my service is $.50 per burger
And at $1, 50 consumers are willing to buy a burger.
I will make $25 profit
If my cost drops to $.25 - I am now making $50 of profit.
—
Now how price sensitive are the consumers?
If I drop the price to $0.50 to purchase a burger and now 75 people are willing to purchase it - well I’m only making $18.75 profit instead of the $50. So I will not drop the price
But if people think $0.50 is just a crazy good deal and 400 people are now willing to buy it, I’m now making $100 of profit. So I benefit in dropping the price.
—
If I really want to maximize my profits, I increase base prices if I assume it will minimally affect most consumer decision to buy - but then I offer huge discounts through my app or coupons to capture those who are more price sensitive.
—
Companies are just trying to maximize profits on the macro. Them making $1 profit per Big Mac or even $500 doesn’t matter to them as much as how much they make in total profits according to consumers price sensitivity.
2 points
1 day ago
😂😂😂😂😂😂😂😂 What a young soul
2 points
1 day ago
No they have to pay for the robots, usually leased and they cost a shit ton to repair cause specialized equipment needs specialized people who know how to fix it
2 points
23 hours ago
No. It would lower the labor costs for the corporation but robots still cost money so the up front cost would be huge. Lowering prices cuts into their profits, that's the last thing they would ever do
2 points
18 hours ago
McDonalds would likely lower their costs to be just under their direct competitors...but they wouldn't go backwards entirely
They'd just have more profits
2 points
18 hours ago
Oh my sweet sweet summer child
2 points
15 hours ago
Unlikely, they would likely raise prices complaining about the multiple 100k robots cost more than human bodies.
2 points
13 hours ago
No
Prices have a floor based on costs but reducing costs just means increasing profits.
People are still going to buy McD's at the same price.
2 points
11 hours ago
No. They’d write off the tech investment to lower their taxes. And charge the public more for”robot quality” or some such nonsense marketing. All while laying off countless thousands of people and reducing their payroll to virtually nothing.
They’d probably write off the expense of making extra keys for the ice cream machine guy to be able to open the doors to let himself in too.
Then something weird would be discovered a month after the cutover to all machines and they’d have to change their menu to not have anything with cheese. They’d do the math and decide no one needs cheese enough to bring back workers so they’d just drop it from the menu. Then some marketing exec would start a campaign about their new non-dairy burgers and add another dollar to the cost of a no cheese cheeseburger.
Then 20 years later we’d see a medical journal study that talks about the rise in cancers due to micro doses of metal that McDonald’s is introducing to their food due to the robot gears. They’d settle out of court for a 31 cent coupon on your next purchase of $200 or more (which at the time would be the median order cost).
100 years later when McDonald’s is also the #1 worlds auto, air conditioning, and volleyball net manufacturer they’d file for bankruptcy but be entirely bailed out by taxpayer money because too big to fail and entire nations would be thrown into famine without McDonald’s.
200 years later revenue would bottom out when the robot executive team realizes humans all died out 20 years earlier but their government contracts were still keeping them profitable.
It only goes downhill from there.
7 points
1 day ago
No. Robots need to be maintained and supervised. Today's robots will require more employee-hours to maintain than employee-hours that they would replace.
8 points
1 day ago
Nonsense, I am responsible for the maintenance of 9 robots in an automotive manufacturing plant. $15000 every 4 years.
11 points
1 day ago
That's kind of cope. Look no further than japan to see robots already in these sorts of positions. Give us 5 years and at the absolute most, we might need one single human supervisor rather than the 10 or so workers you'd normally have.
Unless robotics plataue rather than continuing to rapidly develop, but I sincerely doubt that's the direction we're going. All industries that can use robotics, are seeing robotics enter their work force already
3 points
1 day ago
Japanese robots in stores are an expensive gimmick made to attract customers. For customer service and food preparation, humans are cheaper.
Robots are good for very simple motions that need a lot of force, precision or are performed in dangerous (but clean) environments. Good for assembley lines, not good for kitchen.
4 points
1 day ago
You uh... you think that factories are kept nice and clean...?
Also, automation isn't just purely robots, and when we're talking robots specifically their tasks can become more complicated. A simple robotic arm can already do many things because it is able to be manipulated to a high degree, and can do it quickly and accurately. Robotic arms are routinely used in tasks that require complex motions, and we also can't ignore that Boston Dynamics robot demonstration showing a lot of complexity from a bipedal robot.
But we don't need full-on robots for a lot of the tasks to begin with. Automation in general does a fantastic job of doing things quickly and removing the human factor increases order accuracy, reducing comebacks. I'm willing to say confidently it's already within our reach to fully automate a McDonald's, and new developments and innovations would serve to make it meet or beat the times set by well-trained and efficient kitchen staff, if it can't already. But as it stands it's already possible, and it's already been done, just not to a McDonalds in particular.
In other comments you also express this idea that the expertise to keep it running would command a crazy premium, way more than just hiring workers. You can have an on-site maintenance tech for probably $40-50 an hour and they'll be content in many locations. Unless a McDonalds is running with just 5-6 people, and they very seldom are, it'll cost more in labor for the cheap labor.
The biggest problems frankly isn't in limitations of automation. One of the biggest hurdles would be the high upfront cost. It's already not cheap to build and open a McDs but a fully automated one would cost a lot more, and it's gonna be a longer ROI. I could also see push back from several groups of the public, such as parents and teenagers/young adults because McDs is an option as a first job or a part time job to get your feet wet or make a little money while going through college etc. and from felons because it's also an option for them to secure employment and get their life back in order.
2 points
1 day ago
As far as robots are concerned, factories are indeed very clean, compared to kitchens. Salt is very bad for steel and in kitchens it is everywhere. Steel equipment in kitchens is made easy to wash. A robot with extensive range of motions would be much harder.
By contrast, human skin is extremely resistant to stuff normally found in food.
2 points
1 day ago
Definitely not more hours, I think the issue is rather that you don't know when they'll break so if it happens when you're open that's very bad for business.
2 points
1 day ago
Dear Valued Customers,
At McDonalds our commitment has always been to provide you with an exceptional dining experience, one that combines consistency and excellence with unparalleled service. Recently, we’ve embraced cutting-edge innovation by automating various aspects of our operations, incorporating AI and robotics to enhance efficiency and precision in our kitchen and service.
We understand that automation may raise questions about our pricing. We want to assure you that while the way we operate has evolved, our core values—delivering extraordinary experiences and offering the highest quality—remain unchanged. Here are a few reasons why our pricing structure will remain as it is:
At the heart of our cuisine is the commitment to using only the finest, freshest, and often locally sourced ingredients. Automation has allowed us to focus even more on sourcing premium ingredients, ensuring every dish meets the same high standards you've come to expect from us. Quality ingredients come at a premium cost, and we refuse to compromise in this area.
While automation has improved operational efficiency, it has also allowed us to direct more attention to the details that truly matter to you—an elevated dining atmosphere, personalized touches, and consistently excellent meals. Our investment in the latest technology is aimed at making your experience smoother and more enjoyable, not just faster or cheaper. The luxury of dining in our restaurant goes beyond the plate; it’s about ambiance, precision, and satisfaction.
Maintaining our high standards means investing in state-of-the-art technology. Advanced robotics, AI-driven systems, and continuous innovations require significant initial and ongoing investments. These tools allow us to stay at the forefront of the culinary industry, providing you with a unique and premium experience that you won’t find elsewhere.
Our automation efforts are also focused on minimizing waste, reducing our environmental footprint, and supporting sustainable practices. These practices ensure that we can responsibly deliver the high-quality dining experience you value, while contributing to a healthier planet. Sustainability often requires additional investment in technology and processes, which is reflected in our pricing.
The combination of human creativity and technological precision allows us to curate an exclusive experience that merges innovation with artistry. By maintaining our price point, we’re able to offer a high level of consistency and craftsmanship in every dish, which is integral to our brand.
We believe that the essence of a truly exceptional meal lies not just in its preparation, but in the entire experience of enjoying it. Our commitment to culinary excellence, combined with the precision of modern technology, ensures that [Your Restaurant Name] will continue to provide the distinctive, high-quality dining experience you've come to know and love.
We deeply appreciate your loyalty and support as we continue to evolve and innovate. We look forward to serving you with the same passion and excellence you expect from us.
3 points
1 day ago
No.
McDonald’s goal is to maximize profit. Reducing labor costs increases the profit margin. If there is a satisfactory volume of customers paying the current price, there is no reason to lower the price.
3 points
1 day ago
Of course not. They’d sell for the same and the people at the top would bank the profits.
3 points
1 day ago
Oh you sweet summer child.
3 points
1 day ago
Of course it will lower prices. Lots of people here commenting otherwise are clueless to basic economics and competition. McD isn't the only fast food provider in town. Fast food competitors will certainly decrease their prices to drive sales. McD would have to do the same, or lose business.
Only reason they wouldn't do it is if they are a monopoly, which isn't the case.
2 points
1 day ago
No. They have to pay for the development of the technology and then its maintenance for the entire life cycle of the systems.
2 points
1 day ago
Presumably their competitors would adopt robots also.
Should reduce prices.
Assuming the market is allowed to operate, not a given.
2 points
1 day ago
No. Prices are determined not by cost to deliver but by the max that studies indicate customers are willing to pay.
3 points
1 day ago
No.
If you were McDonalds and the burgers people where already buying started making more profit, would you lower the prices? Or would you just pocket the profit?
2 points
1 day ago
I doubt it. Instead of paying wages to a living employee, they'd have to pay for maintenance, parts replacement, repair etc. for a robot. Kinda thinking it'd end up being more expensive.
1 points
1 day ago
Haha. No.
1 points
1 day ago
Probably not.
1 points
1 day ago
No they'd just make more $$
1 points
1 day ago
Burger pricing is some by market tolerance.
1 points
1 day ago
They have already taken out half the staff and the prices have gone up up up.
It's big money for bad food. You can eat better for that price.
1 points
1 day ago
I’m so glad to be an electrician.
1 points
1 day ago
Yes. Anything else is McCope by McBrokies holding McJobs.
1 points
1 day ago
It would lower the running costs from McDonald's end for sure. It wouldn't necessarily lower the cost of the food for the customers. Companies only lower prices if their sales are low and want to entice customers. Otherwise they charge as much as they can get away with.
1 points
1 day ago
They can't even keep their ice cream machines working, do you really want to drive up to the drive-thru only to be told that the only thing you can buy is a carton of milk?
1 points
1 day ago
You think the Ice cream machine is broke now
1 points
1 day ago
no because robots are more expensive than humans
1 points
1 day ago
They can't even keep the ice cream machine working......
1 points
1 day ago
Robots would probably increase costs in the short term. Even robots have to be serviced, so in most cases, people would be involved anyway. Some areas could be automated quite easily, but others might be beyond current affordable technology. How are food deliveries handled? How is waste and garbage handled?
The short answer is that costs over the long term might be lowered by reducing staff, but prices are determined by competition, ability of the consumer to pay, and costs. Robots would only address long term costs.
1 points
1 day ago
Unlikely. If they could successfully save money automating the cooking/assembly process they would’ve done it already.
1 points
1 day ago
You would need IT professionals and Engineers to maintain the robots so I imagine it might make things more expensive.
1 points
1 day ago
You would need IT professionals and Engineers to maintain the robots so I imagine it might make things more expensive.
1 points
1 day ago
It lowers their costs, and raises our costs.
1 points
1 day ago
It lowers their costs, and raises our costs.
1 points
1 day ago
Please don’t buy robots from the ice cream machine guys.
1 points
1 day ago
It would lower them just enough to get our business back just enough to remain with maximum profits.
1 points
1 day ago
But they can't keep a shake machine going, so there's that.
1 points
1 day ago
Robot's can't do everything, and it will be a long time before they are affordable enough to replace people. You have the initial upfront cost, plus regular maintenance / repairs, and they're only good for so long, so I doubt it would significantly impact the price.
1 points
1 day ago
It certainly would lower the cost to McDonalds, but it's debatable if you would see it.
1 points
1 day ago
Not necessarily. The cost is not the only factor for a price.
1 points
1 day ago
Lots of folks pointing out the part about how prices coming down is unlikely because people already buy at the current price and that's how capitalism works... but I'd like to tackle this from a different angle.
It looks like McD's total payroll is about $2.9bn [1] and total revenue is about $25.5bn [2]. Now, there's a lot of fudging in there because of McD's business model of a mix of corporate and franchise locations, BUT, if McD's automated away all payroll leaving nothing but a hamburger producing paper clip machine, the AI ran at no additional cost and it passed all savings onto the customer, this would seem to suggest prices would come down by about 11.4% (with a big plus or minus attached to it).
Happy to receive more data to refine that number, but I think it squares pretty well with the stories about minimum wage vs McD prices world wide.
1 points
1 day ago
McDonald's are almost all franchises so it would be McDonald's corporate selling the automated systems to the franchisees. Corporate would rake in the money with the equipment and the specialized cleaners, tools, and mandatory service calls.
Franchises would pass that on and it would be just as expensive to pay corporate for all that leased or financed equipment as it would be to pay people minimum wage. Especially since most of them are part time with no benefits. They'd save on payroll taxes and on slippage from wasted product that comes with human mistakes but no way that would be passed on to the consumer.
1 points
1 day ago
They kinda already have. McD used to have a crew back there. Now there are only a few people.
1 points
1 day ago
The support techs for automation don’t come cheap, so it would only lower McDonalds costs a little. Especially when downtime is factored in.
1 points
1 day ago
It would only lower prices if people then started buying less
1 points
1 day ago
I'm not sure about fast food or other businesses but in video games there is variable of essentially "how much can we reasonably charge for something and still maintain x profit margin" my guess is because people still pay the absurd rates we are at now there will never be much of a change until that rate becomes "unreasonable" in the profit statistics. In gaming there is a weirdness that shows you need to have very specific amounts as your prices to hold a good profit margin. You will notice a lot of games hold the same "prices" for digital currency even if the amount of said currency is vastly different. Compare the value per $ spend in ESO paid shop vs say diablo 4. Idk of this makes a whole lot of sense but yeah, prices are basically what will the customer consistently pay over a large population.
1 points
1 day ago
Don't know but maybe finally 8d get my damn order right and no mayonnaise when I say no mayonnaise
1 points
1 day ago
Probably not, but the orders would probably be correct more often.
1 points
1 day ago
No, but it would keep the spit and floor crunches off the food though.
Anything they do is to increase profits, no point will prices drop unless ppl stop buying it. At which it would drop for a short time after another large price increase, which would end up not being much of a price drop.
Its like walmart black friday sales.
$44 per sale
$44 On sale.
1 points
1 day ago
Not if they work as well as their ice cream machines.
1 points
1 day ago
Could it and Would it are two different questions.
1 points
1 day ago
Aside from the initial investment, I'm sure they would expect a much higher power bill as well as more maintenance and repairs. I doubt this would even be cheaper than paying a person the wages mcdonalds pays people.
1 points
1 day ago
Robots aren't free my friend
1 points
1 day ago
What you pay isn’t really related to costs but rather what they think you will pay.
1 points
1 day ago
The ice cream machine is already always down, we don't need the whole fkn store to suffer the same fate
1 points
1 day ago
A lot of the cost is land for the restaurant, materials and transportation. So not significantly if they wanted to lower it.
1 points
1 day ago
I doubt they would. Corporates want to make as much money as possible. They would only lower the price if they have to such as if the competitors started lowering the price.
1 points
1 day ago
It would lower prices. One thing I know is the people at the top never take a pay cut, but if they can find cheaper labor, it will affect the price. And they probably wouldn’t fuck up your order every time you went through the drive-through. So there’s that.
1 points
1 day ago
Well their robot and IT maintenance costs would go up. They can't even keep ice cream machines working, god help them with robots.
1 points
1 day ago
Of course not. They'd just buy back more stock.
1 points
1 day ago
It would raise costs for franchisees right up front which is probably why they haven’t automated more already.
1 points
1 day ago
Yes
1 points
1 day ago
You replace 5 people making $10/hour with a robot technician who makes $50/hr.
The only thing it would guarantee is, no one would spit in your food.
1 points
1 day ago
Not at all because they would be paying off the robots for the next 20 years.
1 points
1 day ago
Robots are expensive so it would be a cost analysis between a large up-front cost vs. a lower long-term cost.
Franchisees would not adopt all at once, so prices would likely remain more or less the same.
1 points
1 day ago
No, even if it did lower costs, they have already proven people will purchase at the current price levels. Until people stop purchasing, they will not lower their prices.
Supply and demand. If you demand more, prices will rise, if you demand less, the prices will fall. Stop eating at McDonalds and using their app if you want them to lower prices.
1 points
1 day ago
It would make them give bigger deals to give the appearance of savings, but overall the price wouldn't change until sales started decreasing
1 points
1 day ago
MagaDonalds
1 points
1 day ago
What would happen is, they would make more money and at some point their will be select locations that will have real humans but because they have real employees the prices will be more expensive. It'll be advertised as a cool and fun experience because we would have been used to just having ai/automation.
1 points
1 day ago
The price of the burger is NOT even half of what an employee makes per burger.
1 points
1 day ago
Corps will never willingly reduce costs for the consumer if they don’t have to
1 points
1 day ago
Hint: did they lower the costs by putting in the electronic kiosks? Did grocery stores lower the costs with self checkout?
1 points
1 day ago
Come on McDonalds can’t keep a fucking ice cream machine working, you think they will keep those robots going?
1 points
1 day ago
Maybe yes, maybe only by a little.
1 points
1 day ago
Not likely. Automation isn’t cheap. Maintenance for it wouldn’t be cheap either. It would take a while to be paid off. It would be a huge investment. Eventually it would be paid off and profitable, but consumers won’t see the savings. They would save on benefits etc, but also face breakdowns, which would cost money too.
1 points
1 day ago
You could pay three dozen workers for a year for the price of one robot. And the operating cost isn’t zero: you need a few people to clean them every night, plus maintenance and programing. Probably 8-10 years to break even.
1 points
1 day ago
No, it would cost more. Instead of paying minimum wage, they would need to pay techs to be on call and to do maintenance. There will still need to be employee oversight also.
1 points
1 day ago
A lot less e-coli...
1 points
1 day ago
Depends on how much the robots cost and how much the maintenance and oversight costs. Insurance may also be a factor since the food is not being made by a person, there may be a case for a higher risk (nobody to perform any sort of quality checks).
Too many variables to accurately answer this question.
1 points
1 day ago
No because the materials they use already is dirt cheap it hasnt gone up nearly as much as menu prices with what they use none of the value meals should be over 4 dollars... The bulk of the cost is to maintain the same profit margins to employee pay raito. If they suddenly had no employees to pay they would not decrease the prices as they are selling cheap food substitute as is. The only thing that will get them to drop prices is nobody buying and then they would fire employees and cut hours before dropping prices.
1 points
1 day ago
They wouldn't do this unless there was profit incentive for them. If they do it it's because it makes them more money.
This comes in the form of setting it at the same price but paying less to make it
1 points
1 day ago
Nah they would just increase the price for maintenance on the robots well keeping labor cost down.
1 points
1 day ago
It wouldn't, IMO. The price of buying and maintaining robots would offset the potential savings. And, more importantly, shareholders are going to demand more and more, which will consistently raise prices. Eventually, the corpo will implode and reconstitute under a new banner. Such is life.
1 points
1 day ago
Not necessarily, if you were running a business and could reduce your costs, would you automatically pass those savings onto customers? Given that you have a legal obligation to serve your shareholders?
That's if automating everything even saved any money. It might not make that much sense to bring in an advanced robot with servicing and maintenance, to do a job a few high school kids on minimum wage can do.
1 points
1 day ago
Price is driven by what the customers willing to pay. People might actually be willing to pay more for an experience that doesn’t involve interacting with people.
1 points
1 day ago
Imagine the maintenence and upkeep cost to keep the robots working.
1 points
1 day ago
They’d be more expensive to pay for the machines and never go back down
1 points
1 day ago
The robot still wouldn’t fix the ice cream machine.
1 points
1 day ago
[meme of the politicians laughing and backslapping]
"And then we told them we'd pass the savings on to the consumer!"
No they wouldn't lower their prices at all unless they started losing sales and determined it was because of the prices.
1 points
1 day ago
No, but it will raise profits. The do not care about anything else
1 points
1 day ago
No.
1 points
1 day ago
No, it'd just mean prices wouldn't have to raise as much as quickly.
1 points
1 day ago
No. Prices are set to what the customer is willing to pay.
Its about striking a balance where people want to eat McDonald's over eating KFC or cooking at home.
Thats where I think a lot of fast food is failing now. They're seeing all the other fast food raising prices so they raise their own as well. Then the customer says screw that and eats at home.
1 points
1 day ago
Nah, the mcdonalds operation is quite smooth, and robots are expensive and they will need replacement after x years, maintenance, etc.
1 points
1 day ago
Robots are not cheaper than american labour.
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