McDonald's Korea Announces Price Hike Amid Record Revenue

In an announcement on Thursday, McDonald's Korea revealed plans to increase the prices of 16 key menu items by an average of 2.8%, effective May 2nd. The decision arises from escalating logistics and labor expenditures.

Korea Times reported that the Egg Bulgogi Burger, Bulgogi Burger, Cheese Burger, and Triple Cheese Burger are among the items seeing an uptick in prices. However, the company clarified that the Big Mac and several other menu staples will retain their current pricing.

Historical Price Adjustments and Financial Performance

According to Korea Joongang Daily, this price adjustment follows a trend, with a 3.7% increase on 13 items last November and a 5.4% hike in February of the previous year. Despite these hikes, McDonald's Korea reported a record-breaking revenue of 1.118 trillion won ($814 million) for 2023, up from 994.6 billion won the previous year. Operational losses have seen a reduction to 20.28 billion won from 27.78 billion won, with net losses also narrowing.

Record Revenues and Local Initiatives

McDonald's Korea announced a milestone last week, declaring a historical revenue of 1.29 trillion won ($815.9 million) in Korea last year. Driven by strategic price adjustments and a commitment to localization, these figures also include sales from franchised locations.

Directly managed store revenue alone surged to 1.12 trillion won, marking the first occasion these earnings have crossed the trillion-won threshold, with a notable 12.4% year-over-year growth.

McDonald's Korea credited its success to initiatives focused on local tastes and sustainability, such as the "Taste of Korea" project, the introduction of 100% recycled PET cups, significant local workforce recruitment, and enhanced digital services. Additionally, with eight new outlets inaugurated last year, the chain aims to expand its footprint to 500 stores by 2030 in a bid to solidify its market presence further.

Photo: McDonald's Korea Website