McDonald’s is using machine-learning models to recommend menu prices across nearly 14,000 restaurants, estimating what customers at each location are willing to pay. The system analyzes millions of daily transactions and produces an optimal price for every menu item at every location. Reuters found a Big Mac priced at $5.69 in one Fresno, California restaurant versus $6.89 in another store three kilometers away, a 21 percent difference. Officially, franchisees set their own prices, but the company pressures them to follow its recommendations and tracks their deviations. The system also ingests published menu prices from competitors such as Wendy’s and Burger King.
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