How bad must McDonalds food be if the Chinese think it is too putrid to serve? Have you seen what the Chinese eat? The storyline for the horrible US sales has been that competition is tougher, blah, blah, blah. It’s all a crock. The American lower and middle class are so hard up for cash, they can’t even afford the $5 for a crappy McShits meal. Barnes & Noble sales were also negative. Gap sales were negative. Wal-Mart sales are negative. Target sales are negative. Olive Garden sales are negative. It isn’t competition. It’s a country running on fumes while the oligarchs pillage, rape and gut the remnants of wealth.
McDonald’s sales woes continue in August
By Erin McCarthy
Published: Sept 9, 2014 8:53 a.m. ET
McDonald’s Corp. said its global sales fell 3.7% in August as problems with one of its suppliers in Asia drove a precipitous drop in sales in the region and the core U.S. market continued struggling as well.
The sales decline was steeper than expected as Consensus Metrix had called for a 3.1% drop.
In the Asia/Pacific, Middle East and Africa region, sales at existing locations slid 14.5% last month.
McDonald’s has said it is seeking to restore customer trust in China, where it has more than 2,000 stores, following problems that began in late July with meat supplier Shanghai Husi Food Co., owned by U.S.-based OSI Group LLC.
Authorities accused the Shanghai plant of intentionally selling expired meat to restaurant companies after a television station ran a report alleging the practice.
On Tuesday, McDonald’s said it expects the China supplier issue will hurt third-quarter results by about 15 cents to 20 cents a share, largely because of lost sales, expenses related to its recovery efforts and the effect of these items on the quarter’s tax rate.
Earlier this month, McDonald’s said it is overhauling its food-safety strategy in China after problems with a supplier hit the fast-food chain’s image and eroded its sales in the country.
The Oak Brook, Ill.-based company said in a statement that it will review surveillance video from meat-production sites in China and boost audits of suppliers. Other steps include the creation of anonymous hotlines for suppliers and their employees to report unethical or noncompliant practices and the dispatching of quality-control specialists to all of McDonald’s meat-production facilities in China, the company said.
“We are diligently working to effectively navigate the current market conditions to regain momentum,” Chief Executive Officer Don Thompson said in a statement Tuesday.
In the U.S., sales slid 2.8% as the company faced multiple headwinds, including sluggish industry growth in a competitive marketplace, the company said.
The U.S. has been a particularly challenging market for McDonald’s, where the company has said it has lost relevance with consumers. Mr. Thompson has said that the company first needs to repair fundamentals, such as staffing restaurants appropriately during peak hours, and has noted that the company is working to streamline its menu as previous efforts to roll out numerous menu items served to complicate matters.
Meanwhile, McDonald’s said sales at existing restaurants in Europe ticked down 0.7% as weak performance in Russia offset gains in the U.K. The fast-food chain warned that weak consumer sentiment will likely hurt sales and profitability in the region.
