This Economy Tarnishes Even the Golden Arches
Cheryl V. Jackson, The Chicago Sun-Times — Chicago Sun Times, January 29, 2008 Tuesday Final Edition
A bleak December chilled McDonald’s Corp.’s 56-month-long record of higher year-over-year same-store sales in the United States.
The company said weak consumer spending in an uncertain economic climate pushed same-store lower compared with a year earlier. [...]
Some franchisees, however, complain the dollar menu offerings — particularly the popular double cheeseburger — hurt their profits.
“Just when we should have pulled the double cheeseburger off the Dollar Menu because of back-door costs, we are now stuck with it for a while,” one owner surveyed said.
[...]
And furthermore…
WASHINGTON (AP) — Consumers, battered by harsh economic crosswinds, spent less in December than at any time in the past 15 months while applications for unemployment benefits soared last week, two more signs the economy is weakening.
…but, on the other hand:
Hardee’s, Carl’s Jr. to focus on pricier sandwiches
As McDonald’s, Burger King and Wendy’s compete head-to-head on value-menu sandwiches, CKE Restaurants said this month that its Hardee’s and Carl’s Jr. chains will continue their focus on premium burgers. “We hope to continue to see benefits from our premium quality focus, as well as our focus on superior service and cutting edge advertising,” CEO Andrew F. Puzder said
[...]Darren Tristano, executive vice president of Technomic Inc., a research and consulting company that serves the food industry, said some fast-food chains are trying to differentiate themselves by becoming more like fast-casual restaurants.Fast casual chains like Panera Bread Co. (nasdaq: PNRA – news – people ) typically offer food at higher prices in a more casual dining atmosphere.
Tristano said companies like CKE have some advantages since they can offer the same quality food but in less time.
He added that CKE’s strategy may be successful, even in a difficult economic environment, since diners less sensitive to price points may still look for a fast food option for convenience.
“You’re still going to have a large group of people who quite frankly don’t care about the price,” he added.
