5€ menus in fast-food restaurants: a cyclical effect or an underlying trend?

Why are €5 menus on the rise?

With rising inflation and the purchasing power crisis, consumers are increasingly looking for affordable food options without sacrificing the quality of the plate's contents. This psychological price of €5 corresponds perfectly to this demand, as it offers an attractive compromise between a low price and a certain perceived quality, mainly inherited from the notoriety of the restaurant brand.

Today's consumers are increasingly demanding: they expect affordable meals that are also tasty, quick and convenient. Faced with this economic pressure, many fast-food chains have adapted by offering lower-priced formulas while maintaining a satisfactory customer experience. Customers appreciate these formulas because they meet basic needs (getting food quickly) while offering a sense of satisfaction linked to value for money.

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Moreover, these offerings respond to new consumer habits, particularly in the fast food sector, where meals on the go and small budgets are becoming the norm. The development of these menus therefore responds to an immediate need, but also to long-term expectations in terms of affordable prices and the quality of products on offer.

Chains' strategies for keeping prices low

To offer €5 menus while preserving their margins, fast-food chains are implementing several advantages across their customer-side value chain:

• Optimizing supply costs:By negotiating long-term contracts with their suppliers, chains can secure lower prices for raw materials, while limiting the impact of price fluctuations on their operating costs.
• Menu standardization: By reducing the variety of products offered, fast-food chains simplify their logistics and reduce waste.
• Time-limited offers:By creating €5 menus available for a limited time, chains encourage fast consumption and generate a sense of urgency among customers, temporarily boosting sales without permanently affecting margins.
• Process automation: More and more chains are adopting technological solutions, such as automated ordering kiosks or online ordering applications, to reduce staff costs and optimize efficiency in the kitchen.
• Partnerships with delivery platforms:By integrating their low-cost offerings into delivery services, chains extend their reach without investing heavily in infrastructure, while capturing a wider customer base.

€5 menus, cyclical effect or lasting trend?

Is the emergence of €5 menus a temporary response to the crisis, or a new norm in fast food?

We can consider:

• Adaptation to the economic context: These menus respond above all to cyclical pressure linked to inflation and falling purchasing power. If the economy stabilizes or picks up again, demand for low-price menus could ease, especially if consumers regain greater financial flexibility in the medium term. This psychological price of €5 could be revised upwards to adapt to new needs.
• Sustainable margins for chains: Maintaining €5 menus over the long term could pose significant economic challenges for some chains with low operating margins. Chains must continually adjust their sourcing, production and staffing costs to maintain margins. If these adjustments become too costly, it's likely that low-price menus will no longer be viable in the long term.
• New consumption patterns: Even as economic conditions improve, consumer habits have evolved. Demand for fast, affordable and convenient meals remains strong, which could encourage chains to maintain attractive offers around this price point, relying on technological innovations and partnerships to optimize costs.

To remain competitive in the face of this new landscape of commercial foodservice offerings, fast-food chains need to adapt their model. Thanks to solutions like Adoria's commercial foodservice management software, it's possible to optimize inventory, supply and cost management while meeting consumer expectations.

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