Freakonomics Chatham Style- The Fried Chicken Dilemma

Freakonomics Chatham Style- The Fried Chicken Dilemma


Since the book Freakonomics came out a number of dilemmas and questions have been answered. Unfortunate for some it discovered cheating scandals and how drug dealers and other nefarious individuals hide assets. Well Chatham has a question that Freakonomics can answer. The fried chicken dilemma, how fried chicken stymied economic development in our community.

Several years ago, many of the large chains began to come out with $1 value products as a way to get customers back into their stores and restaurants did it better than anyone else. The largest fried chicken chains began a pricing war that offered customers a deal almost everyday of the week. Kemtucky Fried Chicken(KFC) on Monday, Church's on Tuesday, Popeye's on Wednesday, and so on. These daily dollar specials lasted for quite a while and several regional chains got involved as well. Harold's Fried Chicken ad Brown's Fried Chicken got into the fray as well. Eventually, KFC, Popeyes, Brown's and Harold's raised the white flag and offered deals but got away from the $1 deals. This left Church's as the winner of the pricing war or it appeared that way.

Church's has had a long and sometimes rocky past with the Southside of Chicago. They reached out to African Americans to become franchise owners on a positive note but they became the subject of an Urban Legend after that and this legend still keeps some African American customers away. Overall, the stores are nothing special, poor customer service, average product and angry customers. What keeps customers coming back? Tuesday's $.99 special, the lines are out the door, customers are angry and can get down right nasty and the staff has a nonchalant attitude. They tried to let the special go and customers did a mass exodus from the store and forced Church's to bring it back.

While it sounds like a win for consumers and a win for the business, it has become a loss for the Chatham community. The Brown's store has closed as they couldn't compete, several restaurant entrepreneurs have reported that they are having difficulty obtaining financing from financial institutions because the financial institutions do not see the community supporting a fast casual restaurant because they all they see is the $.99 deal continue and it is rumored that Whole Foods passed on Chatham because of the $.99 deal and several other issues.

So the $1 deal looks good for both business and the consumers but its been bad for community economic development. Sometimes cheaper is not always good. Maybe the Freakonomics team can give us some insight on this dilemma that can be used to stimulate economic development.

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  • I thought that AFC owned both Church's and Popeye's. but apparently they sold Church's. So, so much for that theory.

    You can rest assured that 99 cent fried chicken had nothing to do with Whole Paycheck Foods' decision. I don't think any bank is going to bankroll Charlie Trotter's in Chatham, either, Church's or no Church's.

    Since you bring up Whole Paycheck Foods Market, does Moo & Oink going bankrupt expand or contract the food desert?

    As far as one restaurant undercutting another, forcing it into bankruptcy, and then whoever buying the restaurant out of bankruptcy having a lower cost base than the original undercutter, that has been the economics of of the restaurant business for a long while. I know where you can buy a Denny's cheap, but it is in a predominantly Mexican northern suburb.

  • The Moo and Oink bankruptcy doesn't expand the myth of a "food desert". The food desert myth is being perpetrated by groups interested in getting grant money to expand their programs to the southside of Chicago. Moo and Oink bankruptcy is a function of a family feud and the some of those stores will reopen under a new company.

  • In reply to Worlee:

    On your first two sentences, I figured as much. In fact, I was banking more on the desert contracting, since Moo & Oink didn't feature vegetables, and Mary Mitchell published about 3 weeks before it going under about how those with high blood pressure figured out that eating pork products was not good for their health.

    I figured that the food desert stuff was hooey, for instance when they said that Walgreens at 73rd and Stony was going to break the desert by selling fruit, even though there are a Jewel at 75th and Stony and a Sav-a-lot across the street, and, until recently M&O at 71st.

    The only problem on the south side is that it doesn't have the ethnic produce markets like on the north side (such as Fresh Farms or Jerry's).

  • These days many people run scams to get government grants. It has been that way for years. I am really surprised that the Minister never really got going with his plan for black farmers. The Minister (not a follower) has been preaching healthy eating for years, I still remember the store on the south side that sold bean pies. Regardless there are farmer's markets every year and personal responsibility is in full effect. If a store in your area does not carry something go to another one.

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