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McDonalds Faces Competitive Challenges

02/05/2019

In a conference call following the release of Q4 and fiscal 2018 results, Steve Easterbrook, President and CEO commented on the need to increase drive-through efficiency to boost breakfast sales which represent 25 percent of revenue. Although the U.S. showed a 2.3 percent increase in same-store sales for the 4th quarter, traffic declined by 2.2 percent in 2018 compared to a 1.0 percent rise in 2017.

For the past year, revenue declined by 3 percent mainly due to refranchising of company-owned stores.

McDonalds has embarked on a program of refurbishing stores including the installation of order kiosks. Expenditure on improvements including installation of a wall between the counter and the kitchen is opposed by franchisees who believe the expenditure is unnecessary and they would rather spend money on upgrading drive-throughs.

The results posted by McDonalds were detailed in the February 1 st edition of EGG-NEWS and can be accessed by entering McDonald's in the SEARCH block.