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McDonald's bet on fresh beef is paying off.



Last year, the burger chain moved from frozen to fresh beef to a quarter-pound burger at most stores in the adjacent US. This change has led to a sales increase of an average of 30% for quarter pounders in the last 12 months, the company announced on Monday. It also helped McDonald's ( MCD ) Burgers gain market share in the "informal food" category for the first time in five years.

McDonald & # 39; s made the change to spark consumer interest in ingredient transparency. Buyers today want to know where their food comes from, said Marion Gross, the company's chief supply chain officer for North America, to CNN Business.

McDonald's said the sale of the fresh quarter pound burger was particularly strong in May 201

8 when it first launched, also thanks to marketing efforts. More recently, the company included the burger with fresh beef in its 2-for-5 dollar deal for the first time. The promotion went well, as CFO Kevin Ozan stated in an analyst conference on the first quarter result.

Switching from frozen to fresh beef was a challenge.

"It took a big transformation," said Gross. Among other things, the suppliers needed new packaging systems and more refrigerators to ensure safe handling of fresh beef. Distribution vehicles needed the right temperature control systems to properly transport the beef. In McDonald's kitchens, employees had to introduce new food safety practices.

Overall, the shift was one of the "biggest, boldest moves we've done in a long time," Gross said. It's the biggest change in the supply chain the company has made since the start of the all-day breakfast in 2015.

This also burdened the company's franchisees, who were responsible for some changes, such as: B. different cooling and storage systems had to pay.

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The Company encountered some friction among its franchisees. In October, the National Owners Association – a self-financing advocacy group for McDonald's franchisees – met for the first time to discuss ways to work with McDonald's to improve livelihoods. The company's aggressive transformation plan, which includes the modernization of digital menu and self-service kiosks, has put franchisees under pressure, which also has problems as McDonald's adds new menu items or makes other major changes.

Gross noted that the move was "not easy", but that the franchisees finally came aboard because fresh beef burgers are just better. "The franchisees quickly became believers," she said.

McDonald's reported the improved sales of fresh beef as it raises questions as to whether it will include a vegetable protein burger in its US menu.

Several fast food chains, including Burger King, have added menu items with meatless ingredients to meat as consumers show interest in the product. McDonald's serves a vegan burger in Europe.

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