There used to be a saying that, “As General Motors Goes, So Goes the Country”.
The company that replaced GM is fitting to our obese country. Fast food for the worldwide masses has propelled McDonalds to probably the most recognized company on the planet. They are everywhere. They are in every country. They are the canary in the coal mine. The methane gas is building in the worldwide coal mine and the canary is getting sick. We are in the midst of a worldwide recession and McDonalds’ sales declines are proof of that recession. When the middle and lower classes can no longer afford to eat at McDonalds, you’ve got a problem. The 1% aren’t impacted as they continue to dine on caviar and filet mignon, while their stock portfolios get fatter. The signs of collapse are everywhere if you open your eyes.
Our friends at JC Penney are certainly on the verge of a turnaround. Companies that have their act together always layoff 300 people at corporate headquarters after already firing 950 people at HQ in the prior 9 months. JC Penney was the ultimate middle class retailer. They are in freefall, as their customers have run out of money and have shifted to dollar stores and thrift stores. The signs are everywhere – SPACE AVAILABLE.
McDonald’s sales fall again amid weakness in Asia
NEW YORK (AP) — McDonald’s says a key sales figure dropped again in January as the world’s biggest hamburger chain struggled with ongoing weakness in Japan and supply chain issues in China.
The Oak Brook, Ill.-based company said global sales at restaurants open at least 13 months dropped 1.9 percent for the month. The figure is a key metric because it strips out the volatility of newly opened and closed locations.
After years of outperforming rivals, McDonald’s has been struggling amid intensifying competition and challenging economic conditions around the world. Late last year, the company ousted the head of its U.S. business after the sales figure dropped for the first time in nearly a decade. CEO Don Thompson, who took the top spot this summer, has vowed to add business by focusing on value while planning a series of new limited-time offers to attract customers.
But Thompson also warned last month that sales were trending negative for January.
In the region encompassing Asia, the Middle East and Africa, McDonald’s said its sales sank 9.5 percent in January. McDonald’s has been struggling in Japan, where it says customers have been eating at home more often since the earthquake and tsunami in 2011.
In China, the company said the timing of Chinese New Year hurt results. But another factor was the ongoing wariness among diners after reports on Chinese television that chicken producers were ignoring regulators and giving the birds unapproved levels of antibiotics. Yum Brands, which owns KFC and is the biggest Western chain the country, has been slammed by the reports. Yum expects its sales in China to fall by 25 percent in the first quarter.
In Europe, McDonald’s biggest market, sales fell 2.1 percent as Germany and France dragged down results. The company said it remains focused on enhanced value and keeping stores open longer in the region.
In the U.S., McDonald’s said the figure edged up 0.9 percent. The addition of the Grilled Onion Cheddar burger to the Dollar Menu boosted results.
McDonald’s shares were down 10 cents at $94.53 in premarket trading.
Reports: J.C. Penney Plans More Layoffs at Headquarters
J.C. Penney (JCP) is planning layoffs at its headquarters in Plano, Texas, according to reports Wednesday.
The expected layoffs were first reported by the New York Post, which said chief executive Ron Johnson plans a 10% cut of the 3,000 employees who work at the home office.
J.C. Penney already let go 600 workers in April and another 350 in July.
The company did not immediately respond to a request for comment. A J.C. Penney spokeswoman told Dow Jones Newswires that the company doesn’t comment on rumors.
Johnson, a former executive at Apple (AAPL), took the helm at J.C. Penney in November 2011. He has led the company’s move to implement a low-price strategy in lieu of sales and coupons. Sales subsequently fell $2.7 billion over the initial nine months of this fiscal year, as the company accrued $433 million in losses.
The stock is down more than 50% over the last 12 months.