Big Mac tries give-back to keep Moscow munching

February 01, 1992|By Kathy Lally | Kathy Lally,Moscow Bureau of The Sun

MOSCOW -- In a city where waiting is practically an art form, the lines at McDonald's have been awe-inspiring.

In the two years since the world's largest McDonald's opened on Pushkin Square, up to 60,000 people a day have waited in line to buy sandwiches and french fries.

But the gigantic lines that snaked back and forth for a block and stretched across the street into a park abruptly ended in January. The Big Mac had gone up to a whopper of a price.

The Big Mac that once cost 16 rubles has cost 59 rubles since Jan. 8.

The elderly here get a pension of 200 rubles a month. Students in a typical college get a stipend of 100 rubles a month. The average monthly pay has gone up over the past months from 600 rubles to about 960, but it costs nearly a third of that for a family of four to buy a cheeseburger (33 rubles), french fries (20 rubles) and coke (20 rubles) apiece.

Yesterday, McDonald's announced a price cut to celebrate its second anniversary. George Cohon, president of McDonald's of Canada, said that, beginning today, prices would go down by 28 percent.

The 28 percent represents the value-added tax imposed by the Russian government. McDonald's, operated by a Canadian-Russian joint venture, plans to absorb the tax itself.

"We have no argument with the tax," Mr. Cohon said, "but we have a loyal customer base and, starting [today] and throughout the winter, we are going to take the tax off."

That will put a Big Mac at about 44 rubles, still astronomical for most Muscovites, who have been encountering rapidly rising prices in basic necessities ever since food subsidies were withdrawn in January.

McDonald's points out that it is not only their prices that have gone up. The prices they pay have risen too. Two years ago, a kilo (2.2 pounds) of beef cost 2.5 rubles; today, it costs 120.

The high prices have cut the daily line of customers to between 20,000 and 30,000. These past weeks, it has actually been possible to go up to the counter and order almost at once. It's been just like a fast-food restaurant.

Yesterday, at the height of the lunch hour, some of the 27 cash registers actually had no lines at all and, among the 700 seats, there were even several empty tables.

How do people afford to eat there? Some have access to hard foreign currency and exchange that for rubles at a favorable rate. Others save up a long time and go to McDonald's on a splurge.

The restaurant has been serving 15 million people a year instead of the predicted 5 million. The 800 employees have increased to 1,500.

Mr. Cohon said the restaurant would donate 1 million rubles ($9,000) along with $420,000 in hard currency to hospitals and a center for handicapped children.

But the attempts at good will during hard economic times have not lessened the anger many Russians feel at high prices in general and McDonald's in particular.

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