Tuesday 27 June 2017

McDonald's all-day breakfast fails to fuel US growth

Photo: Reuters
Photo: Reuters

Erich Zann

McDonald's is trying stage a comeback, but still has plenty of work to do in its flagship US market.

The world's biggest burger chain said US sales dipped 1.3pc at established locations for the final three months of 2016. Its performance was better overseas, and the sales figure rose globally.

The company - which has its global HQ in Oak Brook, Illinois - attributed the sales decline at home to a tough comparison from the year-ago period, when it introduced an all-day breakfast menu. The results nevertheless underscore the hurdles McDonald's faces in its push to revitalize its image while facing broader industry challenges, including supermarkets and convenience stores selling more prepared foods and cheaper groceries encouraging people to eat at home.

Earlier this month, The NPD Group said it expects customer traffic for the restaurant industry to remain "stalled" this year, as it was in 2016.

McDonald's isn't alone in struggling to attract more customers. Starbucks CEO Howard Schultz has said the retail landscape would undergo a "seismic" change as people do more of their shopping online, leading to less foot traffic in general. The coffee chain's transactions at established US locations slipped by 1pc in the previous quarter.

McDonald's, meanwhile, has conceded that it failed to keep up with changing tastes and that it's speeding up efforts to transform into a "modern, progressive burger company". It recently introduced its Big Mac in different sizes, for instance, and has been testing fresh beef for some of its burgers.

Heading into 2017, McDonald's said it would focus on growing customer traffic.

(Associated Press)

Irish Independent

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