News

McDonald's sales woes deepen in November

December 8, 2014

While some analysts claimed McDonald's sales showed some improvement in October, the same cannot be said of the company's November performance. The Golden Arches today announced that its global comp sales fell 2.2 percent in November, including 4.6 percent in the US market.

Other segments also felt the blow, with Europe down 2 percent and Asia/Pacific, Middle East and Africa down 4 percent.

CEO Don Thompson said the company is working on prioritizing initiaitves to improve these sales performances in the near-term, while also "developing innovations to deliver sustained profitable growth through McDonald's Experience of the Future." 

In a news release, Thompson said the Experience of the Future initiative – first announced in October – will better deliver against consumers' evolving expectations for more choice, convenience and value.

The US segment's performance was hampered by strong competitive activity, the company said. McDonald's is working on its marketing efforts, menu simplification and locally-driven organizational structures to remedy this trend.

In Europe, a positive performance in the UK was offset by "very weak" results in Russia and negative results in France and Germany.

And, in APMEA, the supply chain crisis that erupted in July has had lingering effects on performances in Japan and China, the company said, which were partly offset by positive numbers in Australia.

McDonald's is working onbrand recovery campaignsin the markets affected by the supplier issue. 

McDonald's Other Countries and Corporate segment, which includes Latin America and Canada, experienced strong comp sales during November, the company said.

Create Your Taste expansion  

As today's performance results were released, McDonald's also announced plans to "vastly expand" its "Create Your Taste" test, according to USA Today.

The Create Your Taste platform is part of McDonald's Experience of the Future andhas been in testin a handful of SoCal restaurants for about a year. 

The platform allows customers to order from a kiosk and customize their burgers with a variety of toppings. The create-your-own burgers are then assembled in a separate area in the kitchen and delivered to the customer's table.

USA Today's story said the initiative is expanding to 30 locations in five more states – Illinois, Wisconsin, Georgia, Missouri and Pennsylvania – and then to 2,000 locations in 2015.

McDonald's also plans to expand the new platform to include chicken, allowing customers to create their own chicken sandwiches.

According to the story, the wait-time for such a sandwich at the test locations is about 7 minutes. And, a customized burger with a medium drink and fries is $8.29.

One franchisee, Robert Nibeel, who has been testing Create Your Taste, said the platform has generated incremental sales, especially on the weekends. He also said it appeals to millennials.

Nibeel said the biggest hurdle so far has come from software glitches.