Tuesday, September 23, 2014

McDonald's, feeling the pinch, is experimenting

Most major institutions run their course, especially in the fickle food business. Take McDonald's as a prime example.

I've been reporting on the continual sales slump at the once unbeatable fast-food chain's locations across the country and abroad. What I haven't been reporting on is any particularly innovative responses beyond a little bit of occasional menu tinkering. The reason for that is simple. There hasn't been any -- until now.

McDonald’s Corp. is quietly testing a build-your-own-burger concept at four of its Southern California locations. It allows customers to pick out on a touchscreen their own tastes in burger toppings -- jalapeƱos, tortilla strips, etc. The test market expanded from one to four locations last month.

The world’s largest burger chain reported its same-store sales fell 0.2% in the U.S. last year while those of virtually all its competitors rose. Last week, McDonald's posted its worst monthly same-store sales decline in 11 years, hurt by sluggish demand in the U.S., as well as a food-safety scare at a supplier in China. Sales at its venues open at least 13 months slumped 3.7% in August alone.

The build-your-own-burger experiment can be viewed as a test of McDonald's long-held preference for speed of service over variety. CEO Don Thompson has acknowledged in interviews that this could be a problem for customers used to quick service. To guard against too much time being consumed filling an order, the chain is trying in its test markets to streamline the process to maintain the fast concept while broadening the menu appeal.

No comments:

Post a Comment