Burger King Franchises Sue Over $1.00 Double Cheeseburger
Posted by Dr. James McSaddle | Labels: big burgers, burgers, franchises, legal action, news | Posted On Monday, December 14, 2009 at 3:33 AM
A Home Of The Whopper Divided Cannot Stand
On behalf of the Burger King franchisees, the National Franchisee Association has filed another lawsuit against Burger King. The Association represents more than 80 percent of the Burger King franchisees in the US.
This lawsuit is the franchisees attempt to stop Burger King from setting the maximum price for the $1 double cheeseburger that Burger King has added to their value menu. According to the franchisees, it costs them ten cents more to make the sandwich than what Burger King is allowing them to sell it for.
Burger King added the $1 double cheeseburger to its value menu to attract price-conscious customers and compete with other fast food restaurants' value menus. Burger King has had its value menu since 2002.
Twice this year, the franchisees have voted against adding the $1 double cheeseburger to the value menu. In June, the US Court of Appeals for the Eleventh Circuit ruled on Burger King's side.
The Appeals Court said that Burger King was able to contractually require their franchisees to participate in its BK Value Menu program. Burger King required all franchisees to add the $1 double cheeseburger to the value menu on October 19th.
Burger King is the world's second largest hamburger chain. Their franchise owners operate 90 percent of Burger King's restaurants.
The Association filed another lawsuit against Burger King back in May over rebate revenues from soda companies. In that lawsuit, the franchisees claim Burger King was diverting rebate revenues that belonged to them to the corporate advertising budget.
Burger King is known as the place to have it your way. The franchisees are suing Burger King over not being able to have it their way with the pricing of the $1 double cheeseburger.
Source: huliq.com
I wonder what kind of profit margin exists for McDonalds McDouble and Double cheeseburger?
There's no way they are losing money on those.