In efforts to better compete with its rivals, namely Yum! Brands (NYSE:YUM), McDonald’s has been pushing add value to its existing menu. At its 9,400 locations in Asia, that means delivery service, value dinners, and even bubble tea, a popular drink in the region. In North America, the chain has been emphasizing its value menu and offering new alternatives, such as the McFish Bites.
Sales fell 3.3 percent in the U.S. and 0.5 percent in Europe, Bloomberg reported. Analysts had projected declines of 3.6 percent and 0.5 percent, respectively, according to Consensus Metrix, a researcher owned by Wayne, New Jersey-based Kaul Advisory Group. Sales in Asia, Africa and the Middle East also declined, but like the global results, they came up short of the decrease projections. Analysts had figured a 1.7 percent drop, the actual figure fell at 1.6.
McDonald’s could be facing a big opportunity in China, where recently, Chinese food regulators put Yum! subsidiary KFC suppliers under investigation for excessive hormone and antibiotic usage. The resulting fallout — social media buzz, boycotting — caused a sharp drop in sales for the company, who insisted all along that the food was “perfectly safe to eat.” While Yum! is still working to regain its trust with the Chinese market, McDonald’s can use this incident as cover to slide a larger presence into the region.
McDonald’s is confident that an array of new product launches for the remainder of the year will help offset the losses accumulated last month.
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