Why does McDonald’s Corp. (NYSE: MCD) sell a 1,060-calorie “Big Breakfast With Hot Cakes”? Because it has to. No matter how much pressure food health advocates put on the fast-food chain, and how much it agrees to set a healthier menu, McDonald’s cannot afford to walk away from one of its largest customer bases. Some people still want fat-laden, sugar-heavy foods. If McDonald’s will not sell them, potential customers will go to places like IHOP.
McDonald’s recent sales and revenue problems have been extensively chronicled, as have its very public efforts to satisfy groups that continue to attack its menus. The fast-food company stopped reporting same-store sales, but in May they continued to slide. Stores in the United States open 13 months had a fall off of 2.2%. With the exception of increases in December and January, in the United States the trend continued for a year. In the second quarter, global revenue dropped 10% to $6.5 billion. Same-store traffic dropped 2% in the United States during the same period.
McDonald’s management has been under duress from organizations that include Michelle Obama’s “Let’s Move” program, meant to help give people, particularly children, healthier fast-food choices. McDonald’s has gotten the message that some people who come to its stores want to eat “better.” There are more salads on its menu, but along with a number of items with calorie counts over 500, and high total fat and sodium content as well.
McDonald’s has done nothing more or less than any other business that wants more customers, which is give the people what they want. And what many people continue to want is high-calorie, tasty fast food. This is the kind of food they have expected from McDonald’s for half a century. It is the good stuff, whether it is good for people or not.
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