It's National Hot Dog Day. Look past today's deals and you'll find plenty of franks that cost $6 (and more)

By Charles Passy

The summertime classic has climbed in price by 6.9% during the past year, according to the latest government figures

Americans can enjoy plenty of deals on frankfurters today, which marks - what else? - National Hot Dog Day. But as for the rest of year? Apparently, they're prepared to pay a pretty penny.

Or, more accurately, $5.88 per frank.

That's part of the findings of a new survey from US Foods, a prominent food-service distributor, that looked at our hot-dog consumption habits. Specifically, the survey of 1,000 Americans asked how much they're willing to pay for the summertime essential foodstuff.

Not that Americans seem to have lost their taste for tube steaks, as franks are sometimes called. They spend billions of dollars on them annually at supermarkets, restaurants and, of course, baseball stadiums. In fact, the sporting venues alone account for sales of nearly 20 million franks each year, according to the National Hot Dog and Sausage Council.

Still, the price of franks has surged by 6.9% in the past year, according to the latest Consumer Price Index report. That's a considerably higher clip than the 2.2% inflationary uptick for food overall - and higher than the 2.6% increase for meats, poultry, fish and eggs.

And it's not like $5.88 will even guarantee that you can get a hot dog. At some baseball stadiums, prices run as high as $7 and up, according to a recent Washington Post analysis. That's for the cheapest frank offered at the venue, by the way.

Moreover, higher-end dining establishments have been touting gourmet-style hot dogs of late. At Serendipity 3, a New York City restaurant famed for its one-of-a-kind frozen hot chocolate treat, the lineup of hot dogs runs from $18.95 to $25.95.

Still, Joe Calderone, the restaurant's creative director, is quick to tout the quality of its franks, to say nothing of the variety of offerings, from an Italian Stallion dog (topped with marinara sauce, melted mozzarella cheese, grated Parmesan and micro basil leaves) to a mac and cheese dog (topped with - what else? - mac and cheese).

Calderone says demand remains solid, with the restaurant selling up to 100,000 hot dogs annually.

"Who doesn't like a hot dog?" he told MarketWatch.

And for those who really like to splurge, Calderone notes that Serendipity 3 occasionally sells a $69 frank, made with Kobe beef and covered in such fancy toppings as foie gras and truffle-flavored onions. It's served on pretzel bun imported from Germany.

Some frank fanatics say things are getting a bit much -literally.

"Overpriced is overpriced," said Rick Miramontez, a New York publicist who prefers a no-nonsense, traditional hot dog, such as the ones he devours at the many baseball games he attends.

Miramontez doesn't balk at the prices at the ballparks, however. He says tube steaks are just part of the game-day experience and he can't deny himself his two franks per outing. "Baseball has essentially branded the hot dog," he said.

A variety of factors are playing into the current high price of hot dogs, food-industry experts and professionals say.

Part of it is the fact that franks are a seasonal product - meaning they're especially popular in the summer, says Kevin Bryla, chief marketing officer at SpotOn, a point-of-sale software provider that works with restaurants. So, just as chicken-wing prices typically rise during football season (and especially during the Super Bowl) because of their appeal at that time of year, hot dogs will tend to be pricier during the warmer months because of all their connection to baseball and barbecue seasons.

'Overpriced is overpriced.'Hot-dog fanatic Rick Miramontez on the high cost of some franks

Steve Zagor, a New York-based restaurant consultant who teaches at Columbia University, also says that hot dogs are a labor-intensive product to make, from the grinding to the adding of spices and stuffing in casings. That's unlike, say, hamburgers, which just require the grinding. So, consumers are paying for that added labor.

But that also means hot dogs can be a relatively easy product for restaurants and food operators to prepare: The real prep has already been done and it can be as simple as putting the hot dogs in boiling water (think the classic New York "dirty water dog").

Which means hot dogs can be a good source of revenue for operators. Indeed, Arlene Spiegel, another New York-based consultant, says the profit margins for them can be greater than for hamburgers. And at baseball stadiums, there's also the fact fans can't exactly shop around for a deal once they're inside the venue.

The stadiums "have a captive audience," said Spiegel.

Those looking for a hot-dog deal don't have to despair entirely, however. Costco (COST) has long been known for its $1.50 hot dog-and-soda combo. Such pricing is a fraction of the $5.88 that consumers are willing to spend for a frank alone, notwithstanding the fact you have to pay for a Costco membership to take advantage of the bargain.

Even though the combo has all the hallmarks of being a loss leader - that is, a deal to get people into the store - Costco executive vice president Richard Galanti once told MarketWatch that the warehouse chain finds ways to make it work. For example, Costco has built its own hot-dog production facility to save on costs.

It also doesn't hurt that Costco sells a lot of hot dogs - some 300 million by Galanti's count. Again, it's the American way.

-Charles Passy

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07-17-24 1404ET

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