barns. McDonald’s expects it will take about a decade to fully implement cage-free production in Canada. Chickens raised without the antibiotics that are used to treat humans, promised in Canada by 2018, are expected to raise the price of McChickens and McNuggets because farmers will lose more of their inventory to disease and the cost of that will even- tually be passed along. Sylvain Charlebois, professor of food distribution and policy
at the University of Guelph’s Food Institute, is one food expert who believes consumers will be willing to pay for higher-qual- ity food. “The needle is shifting. Consumers are beginning to ask
questions about the origin of their food,” he says. “Any move- ment along these lines has market currency. In recent years, more and more consumers find that they are willing to pay for more expensive food products as a result of procurement changes.” But others aren’t so sure about how higher prices will reso-
nate with McDonald’s customers, who are used to value pricing. “I really don’t think McDonald’s can raise the quality of all its
ingredients if that comes along with price increases,” Friend says. “If people want to pay $8 to $12 per meal, they have many other options.” John Gordon, founder and principal of Pacific Management
Consulting Group, a San Diego-based research firm that focuses on chain restaurants, believes that phasing out cages and antibi- otics is a good thing. But he’s not sure the company has decided what it wants to be as it undergoes this image makeover. He cites the “McPick 2 for $2” in the US, which allows customers to choose two items from among McDoubles, McChickens, small fries and mozzarella sticks for US$2. “They talk about better ingredients, better this and better
that,” Gordon says. “But at the same time they get drawn back to their low-price heritage. That confuses customers.” There also seems to be a bit of confusion out there about whether the company is committed to streamlining its menu, as it has talked about doing, or if it is still trying to woo customers with fancy new menu items. A recent example of this in Canada was the Canadian Holiday Warmers collection, featuring an onion-topped Jolly Burger and ginger cookies. Last fall,
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Canada’s Gold Standard in Governance Education MARCH 2016 | CPA MAGAZINE | 29
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