One other thing to compare is business and health regulations. Compliance with that is certainly more involved and costly today than in 1940 and would account for part of the price.
replyI'd love someone to build a tool that shows the price of that burger, say, and breaks it down to the input cost.
reply Burger: $5.00
----------------
Meat: $0.20
Bun: $0.05
Staff: $0.25
Insurance: $4.50I've heard the rule of thumb in a well run restaurant business is 30/30/30/10:
reply 1. 30% food costs
2. 30% labor costs
3. 30% overhead
4. 10% profit marginThat’s a good rule of thumb, minus the profit margin.
replyThe problem with this model is that the staff and insurance are essentially fixed costs, so if they sell 500 burgers on Saturday but only 250 on Tuesday, then the insurance cost-per-burger on Tues is double what it is on Sat. Staffing might increase by an extra body or two on the busy days but won't double, so it also has a much higher cost-per-burger on Tues.
replyI am not a restauranteur, just a customer (and observer) but I dont think many restaurant operators understand this concept either. Many seem to be raising prices to cover higher costs-per-item due to fewer customers to spread the fixed costs over. And then the higher prices turn more people off, now prices need to be raised again. Death spiraling themselves.
Insurance is not a fixed cost. Property and auto insurance are, but liability is a percentage of sales, its fixed for a year then adjusted for next years planned sales.
replyRestaurant portion sizes have definitely increased - a lot - since the 1940s-50s. Maybe some minor pullback the last few years but still way larger than back then. A McDonald's Quarter-pounder was considered very large, that was in 1971, many sit-down restaurant burgers today are 5-8 oz.
replyIf anything, I think they've probably decreased ("shrinkflation").
replyNot in the US. See "portion distortion".
replyhttps://pmc.ncbi.nlm.nih.gov/articles/PMC1447051/
https://pmc.ncbi.nlm.nih.gov/articles/PMC8667835/
Edit: hamburgers and hotdogs are pretty standardized though
Unfortunately no mention of prices, so increase in portion sizes might be below inflation; and I suspect the former could be a strategy of compensation for inflation by making it seem less drastic ("yes it costs more, but we also made it bigger!")
replyThe cost of labor has gone up faster than the cost of food ingredients so portion size inflation is a rational response by restaurants.
replyEveryone knows what a quarter pounder is!
replyOne time when I was a kid and my dad and I were in line at Fuddruckers, we overhead someone else in line say "I don't think I could eat a third of a pound, so I'll have to get a half a pound instead. It's still a reference we laugh about over two decades later.
replyOr do they? https://www.youtube.com/watch?v=EMNqJQaf08E
replyClearly, you've never seen Pulp Fiction.
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