The Effect of Cost Control on Menu Pricing in Fast Food Chains: A Case Study of Mr. Bigg's, Lagos State
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Background of the Study
The fast food industry in Nigeria has experienced significant growth, driven by urbanization, changing dietary preferences, and the rising demand for quick-service meals. In Lagos State, a hub of economic activity, fast food chains like Mr. Bigg's have become a prominent part of the food service landscape. However, the success of these businesses is largely dependent on effective cost control and pricing strategies (Adekunle et al., 2024).
Menu pricing in fast food chains is influenced by several factors, including food costs, labor expenses, rent, and overheads. Cost control involves monitoring and managing these expenses to ensure profitability without compromising quality. In an industry where price sensitivity is high, ineffective cost management can result in either overpriced menus, which deter customers, or underpriced items, which erode profit margins (Olaleye, 2025).
This study focuses on the relationship between cost control measures and menu pricing strategies at Mr. Bigg's in Lagos State, providing insights into how cost management practices influence competitive positioning and customer satisfaction.
Statement of the Problem
In a competitive and cost-sensitive market like Lagos, fast food chains face the challenge of maintaining profitability while offering affordable menu items. For Mr. Bigg's, the rising cost of raw materials, inflation, and operational expenses have heightened the need for effective cost control mechanisms (Ibrahim, 2023). However, there is limited research on how cost control directly impacts menu pricing strategies in the Nigerian fast food industry.
Ineffective cost management can lead to financial instability, reduced customer patronage, and compromised service quality. This study aims to address this gap by analyzing the effects of cost control on menu pricing at Mr. Bigg's, providing actionable recommendations for optimization.
Objectives of the Study
1. To evaluate the cost control practices implemented at Mr. Bigg's in Lagos State.
2. To analyze the relationship between cost control and menu pricing strategies.
3. To recommend strategies for improving cost management to achieve optimal menu pricing.
Research Questions
1. What cost control practices are implemented at Mr. Bigg's in Lagos State?
2. How does cost control impact menu pricing strategies at Mr. Bigg's?
3. What strategies can improve cost management and optimize menu pricing?
Research Hypotheses
1. Cost control practices significantly influence menu pricing at Mr. Bigg's in Lagos State.
2. Inefficient cost management negatively impacts profitability and customer satisfaction.
3. Improved cost control measures enhance menu pricing strategies and business performance.
Scope and Limitations of the Study
The study focuses on Mr. Bigg's outlets in Lagos State, examining the relationship between cost control practices and menu pricing strategies. Limitations include the potential variability in cost structures across outlets and challenges in accessing financial data.
Definitions of Terms
• Cost Control: The process of managing and reducing business expenses to maintain profitability.
• Menu Pricing: The determination of prices for food and beverages offered in a restaurant.
• Fast Food Chain: A network of quick-service restaurants offering standardized menus and services.
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