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>Johny Harris's take on the matter does not address the 'loss-leader' / Psychological reason that I put forward.

Well, some data would be advisable. Is it a loss leader? Is their ice cream priced lower than wendy's, burger king, in-n-out or similar? To the best of my knowledge, none of those places have this problem.



I speak primarily of international markets. For example : All of Burger King's desserts are priced 3x times that of McDonald's soft cone - which is evidently a loss-leader. Source : https://menuprice.co/in/burger-king-menu & https://menuprice.co/in/mcdonalds-menu


In my observation, in international markets the price of a McDonald's soft-cone dessert is 1/6th of their primary burger ! Source (for example): https://menuprice.co/in/mcdonalds-menu . The pricing is simply unsustainable if folks walk in only to purchase the soft-cone. The clever marketing folks understand this underlying 'loss-leader' dynamic. The consumers would not tell you this explicitly - as it would appear to be 'cheap' on their part, but consider it a good-deal whenever the 'McFlurry' machines work. Further it has been shown sugar is pretty addictive.


What does the price of a cone in relation to the price of a burger have to do with a cone being a loss leader or not? The price of a burger has absolutely nothing to do with their costs on the cone.

If the cone is profitable to sell, then it's not a loss leader and they have every incentive to sell as many of them as they can.


The cone is not profitable at about 25 to 30 Cents US (including local taxes) in international markets - where dairy ingredients, stable electricity and store front rental in a fancy location are expensive. The burgers (about $2.50 USD) on the other hand rake in 100-200 % profits. Regular Coke sells at about $1 USD; again comparable to US market prices.


> dairy ingredients, stable electricity and store front rental in a fancy location are expensive

Two of those three are not really marginal costs. Yes, it costs electricity to make the food, but _stable_ electricity is something you already need in the biz, same as rent. If you need a generator, you already have one.

Also, enlighten me: are markets where electricity grids are unstable the same ones where retail space is expensive?




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