☕️ Porky arbitrage

The mysterious reappearance of the McRib [Morning Brew] [December 06, 2020]( [Light Roast]( TOGETHER WITH [Mugsy]( Good morning, and welcome to Light Roast, Morning Brew’s premium Sunday newsletter. On a typical week, we send Light Roast to readers with three or more referrals, but every so often we like to open it up to our entire audience so you can see what it’s all about. Read on for a meaty piece about reconstituted pork parts, 10 article recommendations, and a Q&A on graphic design. Bone app the teeth. —[Jamie Wilde]( BIG DEAL [Back in BBQ]( [McRib](The%20McRib%20is%20back%20nationwide%20for%20the%20first%20time%20since%202012) PAUL J. RICHARDS/AFP via Getty Images As of Wednesday, the in/famous McRib is back at McDonald’s for its first nationwide rollout since 2012. Whether or not you’re a fan of the McNugget’s porcine cousin (same chef, same process), you might be wondering, “Why now?” While there’s no direct link between McRib rollouts and the Mayan calendar, there are a few popular conspiracy theories [detailed by]( Willy Staley in The Awl purporting to explain why the McRib occasionally rises from the fast food ashes...but never for long. Theory #1: Porky arbitrage  Axios Does McDonald’s time McRib releases to the [pork price cycle]( for a bigger profit per sandwich? From 2005–12, dips in hog prices have matched up with McRib launches, according to the above chart from Axios. But it’s unclear whether McDonald’s is taking advantage of low pork prices, or causing them. See those price spikes in the summer leading up to each release? They seemingly coincide with the announcement of the McRib, meaning the announcement itself could artificially inflate hog futures. Another snag: Is McDonald’s really that agile? One franchise operator told Freakonomics that McRib launches are planned at least [a year out](. Theory #2: Loss leadership A “loss leader” is a product that costs businesses more to make than customers pay for it. Companies choose to take an L on these items in the hopes that they will lure customers to buy profitable products that recoup the loss. Think of cheap printers that require expensive ink. - By that logic, the McRib could be nothing more than a barbecue-bathed marketing tactic to get customers through the golden arches. Once inside, McDonald’s makes money from the drinks, sides, and other items customers buy to round out their Michelin-star meal. + This theory could tie back to the first one: If the McRib is indeed a loss leader, McDonald’s would have more reason to take advantage of low pork prices. Theory #3: Diminishing marginal utility This is the Occam's razor of the bunch: the McRib just isn’t popular enough to be a full-time member of the menu. According to the same franchise operator quoted above, McRib rollouts follow a repeating pattern: “First few weeks we sell nearly 200 per day and near the end we may sell less than 50 per day.” The menu item makes money in limited runs, but becomes less valuable long-term. So, put another way… The McRib’s a Supreme hoodie, the McNugget’s a North Face fleece Some history: In 1981, McDonald’s was struggling to churn out enough McNuggets. It had overloaded the chicken supply chain, so the same chef who created those pulverized poultry patties made a similar product out of pork parts. Eventually, the chicken supply caught up to McDonald’s demand, while the McRib’s popularity waned. If McRibs were as popular as McNuggets, it’s feasible they’d also become a forever menu item and the pork industry would play catch-up like chicken had. Ergo, McRibs probably just aren’t as popular. Bottom line: Any combination of these theories could be true. But [the mythos]( matters more than the truth, because all of these guesstimations contribute to the McRib’s biggest value-driver: hype. �  �  �  mailto:?subject=Check%20out%20this%20story%20from%20Morning%20Brew%21&body=The%20McRib%E2%80%99s%20Many%20Economic%20Conspiracy%20Theories%3A%20https%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fstories%2F2020%2F12%2F04%2Fmcribs-many-economic-conspiracy-theories%0A%0AWant%20more%20great%20content%3F%20Subscribe%20to%20Light%20Roast%20%E2%80%94%20Premium%20Sunday%20newsletter%2C%20exclusive%20for%20our%20top%20readers.%0Ahttps%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fr%2F%3Fkid%3D4904f90a%26utm_source%3Demail_share%0A SPONSORED BY MUGSY [Dad Is Snazz](#) [Mugsy]( We didn’t used to be crazy about strutting around the grocery store or the neighborhood park with our pops, but now that he’s rockin’ the gift of [Mugsy jeans](, well, we’ll take our old man anywhere. Mugsy jeans are like the [anti-jean jeans](. Their high-tech denim is so comfortable, breathable, and soft, you feel like you're wearing sweatpants. They also make the perfect gift for your dad, brother, boyfriend, uncle, brother-in-law, random cousin who always sends you a birthday card, and [any other guy in your life](. So while Dad drones on about how his new Mugsy jeans are [stretchy in all the right places](, and how they’re not too baggy or too tight, we’re just happy he actually looks stylish for once. This holiday season, [give the gift of comfort]( (and make Dad look cool). [Shop Mugsy today](. LONG READS [Top 10](#) - Are female startup founders facing unfair public scrutiny? ([Fortune]() - All about the convenience stores, aka “konbini,” that feed Tokyo. ([grape]() - How large money managers control our economy. ([American Economic Liberties Project]() - What it was like inside the NBA’s pandemic bubble. ([GQ]() - The rise and fall of Tab, Coca-Cola’s quirky, pink-canned sibling. ([The Journal]() - A day at a NYC food pantry in 2020. ([The Daily]() - Five lessons from Dave Chappelle’s 18-minute IGTV special. ([Stratechery]() - Will the anti-racism industry make people less racist...or just make money? ([Elle]() - How a Kyoto mochi shop survived 1,020 years’ worth of crises. ([NYT]() - The Thoroughbred series, Spirit, Black Beauty...they’re all in the Horse Girl Canon. ([Polygon]() MAIL BAG [Frank process] Francis Scialabba Adam from Cleveland’s Q: Hey Morning Brew. Love your newsletter. I’m a graphic designer, so my question is about the graphics that (I think) Francis usually creates. They look really good, so I was just curious what his process is? Jamie’s A: Hi Adam, I’m glad you noticed Francis Scialabba’s awesome images in the newsletter. Every afternoon, a friendly, automated Slackbot pings the daily writers + Frank in a channel called #editoraldesigns. The writer of the top story for the next day’s Brew hops in the channel to give Frank the gist of the news and an idea or two for an image. He then takes our initial direction and comes up with a cool spin or altogether better idea, hops off Slack, and does his magic. Here’s how he created the above image, broken up into six steps: - “I gathered images into a Photoshop document and removed their surroundings using a selection tool to create a transparent background.” - “Next, I positioned the nail and tailored an indent into the balloon to give the illusion of pressure.” - “To create a sense of depth, I added shading to the bottom of the balloon and around the nail using a feathered brush tool.” - “Using the warp tool, I positioned ‘Forever 21’ in a way that accentuates the curvature of the balloon.” - “Then I added a strip of white to the top left of the balloon to create the appearance of an off-image light source.” - “Using the feathered brush tool and transform selection, I positioned some shadows using a darker hue of the background color. This step adds a sense of depth to the illustration.” To see more of Frank’s work, I recommend [following his Instagram](. Have a question for the Brew Crew? Ask us about economic stimuli, pineapple on pizza, and much more by [clicking here](. BREW'S BETS Does your small business have big sales tax challenges? [Avalara]( unifies sales and use tax calculation, returns preparation, and document management in a single, cloud-based solution. Instead of spending time tracking it all, let your team focus on growing your business. [Learn more](.* ASMR: [This subreddit]( is full of oddly satisfying content, but my favorite post is [this flower](. I can't stop staring at it. *This is sponsored advertising content SHARE THE BREW It only takes 3 referrals to earn access to Light Roast, our exclusive Sunday newsletter. Just the right amount of Brew to go with your lazy Sunday morning. You don’t even need to train the dog to fetch it from the driveway. [Click here to get free swag.]( Hit the button below to start sharing the Brew. 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