“Bold” price rises at a McDonald’s franchise empire helped sales jump by more than £15m during its latest financial year.
Run by Andrew Gibson, AG Restaurants runs 27 sites in Glasgow, employs more than 3,000 people and is one of the largest in the UK.
The business has reported a turnover of £135.2m for 2023, up from £120.1m in 2022.
Its pre-tax profit also grew from £1.8m to £2.3m over the same period, according to newly-filed accounts with Companies House.
The McDonald’s franchise said that it planned to counter any potential negative impact from its price rises with a “strong marketing calendar”.
Marketing push hoped to offset price rise negatives
In a statement signed off by the board, the McDonald’s franchise said: “2023 economic trends are broadly expected to continue into 2024.
“As in 2023, sales growth in 2024 will be predominately driven by year on year pricing benefit.
“This will particularly benefit Q1 before we annualise price moves made in 2023.
“To counter any potential negative guest count impact from price rises, we have a strong marketing calendar, with particular focus on value at key parts of the year.
“The calendar also includes a high number of innovative promotional pies and McFlurry flavour variants, both of which drive strong incremental sales and visits in 2023.
“Given the uncertain market environment, we will as ever need to remain flexible and adaptive should we begin to see any risks to this plan.
“We also expect to see continued incremental sales benefit in 2024 from the MyMcDonald’s application, with a greater customer base engaged with the MyMcDonald’s Rewards scheme and refined CRM communications to encourage customer frequency.”
More ‘bold’ price rises planned by McDonald’s empire
The business added: “In-stores and drive thrus are likely to see similar levels and phasing of sales growth in 2024, as we move away from any lingering Covid-19 impact.
“The percentage of sales and phasing coming through McDelivery is likely to remain stable year on year.
“The 2023 pricing strategy has been bold, utilising a front-loaded approach’s with five pricing rounds overall.
“The price strategy group will continue to take a strategic, customer-led approach throughout 2024, for which four price moves are planned.
“Rather than utilising a front-loaded approach, the price rounds are expected to be more balanced in 2024, with the timing, scale and menu items included in the pricing recommendations leveraging the exciting marketing plan that is in place.
“As with recent years, the group will remain agile against the backdrop of a challenging external environment.”