When you are evaluating a company, one of the items on the list is if the company raises prices, do they retain the same number or grow their customer base. Often times, you will hear people are price sensitive and organization from non profit to profit making companies have many discussions about prices. If the prices are too low, for people see value in paying higher prices, then the normal routine for the organization continues. If prices are too high, people will start or move to prices which are more reflective of their value statement. Many years ago, my residents association was charging $5 for membership, we changed to super member $40, family membership $20 and individual $10. Most of the renewals were at the super membership because the local residents saw value in what the residents association did or was trying to do. To make the change was a 3 month discussion.

In an article by Hilary Russ and Deborah Mary Sophia of Reuters, McDonald’s Corp beat Wall Street expectations for quarterly global comparable sales and profits. Greater numbers of customers visited McDonald’s in all markets and all income groups. Prices for hamburgers and fries were increased, but it translated to a rise in 12.6% sales. Estimates were 8.5% according to Refinitiv IBES data.

Customers are buying fewer items per order, but Chief Executive Chris Kempczinski was optimistic about the rest of the year.

UBS analyst Dennis Geiger noted McDonald’s ability to attract more middle income and upper income consumers highlights the company’s moves to improve the speed of service and food quality.

The average spending per McDonald’s trip was $7.77

On a quarterly basis, McDonald’s total revenue increased 4% to $5.9 billion. That number bested the estimates of a drop in sales to $5.587 billion. The company earned $2.63 a share versus the expected $2.33 and margins increased 14%.

Linking to dividend paying stocks, most companies talk about price and how price sensitive their customers are, for we all like paying less. However profit companies that can pay dividends are able to raise their prices to ensure the margins remain and make a profit. All companies have to do a balancing act to ensure the price matches the value of the profitable customers. If a company does not raise prices, then it is time to find alternatives.

There are more questions than answers, till the next time – to raising questions.