March 11, 2014 in Business

Weather, new rivals challenge McDonald’s

Associated Press
 

NEW YORK – McDonald’s is fighting to hold on to customers in the U.S. – and all that snow didn’t help.

The world’s biggest hamburger chain said Monday that sales fell 1.4 percent at established U.S. locations. It blamed the harsh winter weather, but conceded that “challenging industry dynamics” also played a role.

After years of outperforming its rivals, McDonald’s has been struggling to boost sales as people increasingly flock to places like Chipotle and Five Guys Burgers and Fries. Those chains have popped up quickly across the country by positioning themselves as a step up from traditional fast food, for a little extra money. They also offer greater customization, meaning diners can dictate exactly what toppings they want.

Executives at McDonald’s, based in Oak Brook, Ill., acknowledge Americans’ changing eating habits.

“A long time ago, mass appeal had to be mass appeal,” Jeff Stratton, the president of McDonald’s USA, said in an interview with the Associated Press last month. “That’s not necessarily the case anymore today.”

The restaurants are adapting to a world where McDonald’s traditional strength – consistency – isn’t always enough.

For example, McDonald’s is rolling out new prep tables that can hold more toppings and sauces, a sign that it plans to give customers greater variety.

In the meantime, McDonald’s has made other changes to its menu, including the option to get egg whites in breakfast sandwiches, and the rollout of chicken McWraps, which are intended to appeal to people who want fresher, healthier food.

Globally, McDonald’s said sales declined 0.3 percent at locations open at least 13 months in February. It warned that its muted performance so far this year could hurt first-quarter profit margins.

© Copyright 2014 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


Thoughts and opinions on this story? Click here to comment >>

Get stories like this in a free daily email