How did McDonalds win the price war with other fast food companies?
There are so many fast foods restaurants in the nation: Jack in the Box, In-N-OUT, Burger King, Carl’s Jr, Taco Bell, and etc. But how did McDonalds become the largest chain of fast food restaurants in the world that 123 countries have McDonalds? By winning the price war! When people think of place to dine in with few dollars in their wallet, they think of McDonalds the first. McDonalds has 1 dollar menus such as Sausage Biscuit, Small Coffee, Hash Brown, Sausage Burrito, Sausage McMuffin, McDouble, McChicken, Side Salad, Fruit n Yogurt Parfait, Sweet Tea, Ice cream Cone, and etc. Also compared to other fast food restaurant burgers, its burgers are cheaper. The most expensive McDonalds burger is Angus Burger which costs $3.99 only for the sandwich while the most expensive Burger King burger is “The Burger” at a West London branch of the restaurant, and it costs $186 because it is made of Wagyu beef. How did McDonalds win the war?
McDonalds used cheap ingredients to produce their foods. Chicken Nuggets, for example, is made of these: corn-fed chicken itself, modified cornstarch to bind the pulverized chicken meat, mono-, tri-, and diglycerides, the emulsifiers which keep the fats and water from separating, dextrose; lecithin (another emulsifier), chicken broth to restore some of the flavor that processing leeches out, yellow corn flour and more modified cornstarch for the batter, cornstarch which is a filler, vegetable shortening, and partially hydrogenated corn oil. McDonalds say they only used white meat, but it is not.
These meats are also mechanically separated meats mixed with great amount of citric acid as a preservative. This acid makes the chicken nuggets and even other foods never decay. Because the food never decays, they can keep the food forever until it is sold. This is how McDonalds can do mass production of their products, sell them at a cheap price, and win the price war.
How does McDonalds use the economics of scale to get the cheap ingredients?