Fast food chains revive cheap

Friends Alan Cintas and Sean Dallura sat down at a Del Taco recently for a typical midday meal -- three tacos, nachos, a cheeseburger, chili fries and a chicken quesadilla between them.

Feb 11, 2006 - 10:38
The 19-year-olds are hungry and busy, juggling classes at Saddleback College, sports and jobs. They eat fast food nearly every day. And they can recite by heart the cheap eats at most fast-food chains.

"For $3.52 at Wendy's I can get a junior bacon cheeseburger, chicken nuggets and medium fries -- then I just grab a drink at home," Dallura said.

To keep customers like Cintas and Dallura happy, some fast-food chains are creating, upgrading or tweaking value menus after years of focusing on fancier fare to compete with fast-casual restaurants, which were luring away customers with more upscale food.

Now, fast-food companies, which periodically engage in price wars, want to remind diners that they are still the best place to buy a lot of food for a little money.

But there is a risk to that strategy because too much price-cutting can hurt profits, analysts say.

In Orange County, Calif., and Southern California, Burger King is testing a value menu with several items for $1 including a Whopper Jr., chicken tenders and small fries. And Taco Bell refocused its bargain menu in 2004 with prices ranging from 99 cents to $1.29.

Many fast-food restaurants want to appeal to a wide-range of customers with both premium and low-priced menu items.

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Source - Detroit Free Press