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Business Comment: Terry Murden

Fast measures needed for Big Mac’s big challenge

Steve Easterbrook McDonalds may think it’s something we all have in common, but the fast food chain is fast losing customers.

A million fewer diners chose to visit a Big Mac last year as the world began to lose its appetite for the 60-year-old company.

Six straight quarters of falling sales and the biggest slump in profits in its history has forced the company’s new British chief executive to unveil a new turnaround strategy to investors on Monday.


They are expecting something special from Steve Easterbrook, 47, (pictured) who joined the company 20 years ago and has promised that his plan will make a big impact and challenge conventional thinking.

His pledge is being taken on trust as Easterbrook has not yet spoken to the media since taking over on 1 March.

Whatever his strategy contains, analysts are united in their belief that McDonald’s has some fundamental issues to resolve, most obviously around changing tastes and trends.

The public, especially the key young demographic or millenials (those who became teenagers at the turn of the century), have become wearied and worried by the links between fast food, obesity and the impact of a poor diet. They still crave something fast and appetising, but they want it to complement their healthier gym-and-juice lifestyles.

Food not only has to be tasty and affordable, it is also a fashion statement. In recent years the once dominant yellow arches have been forced to compete for customers who have an increasing choice of fast food joints. New chains, such as Five Guys, have turned McDonald’s into a tired brand for an earlier generation.

For the loyalists, the expansion of the menu to more than 120 items, is said to be causing problems in McDonald’s kitchens and slowing down service, particular at the drive-thru restaurants, which tests customers’ patience.

Some complain they cannot even pronounce some of the products listed, while there is a growing discontent with the “outdated” interiors. All this has created a tension between the company and the franchisees who run the outlets.

While Easterbrook may have answers to the more solvable problems – better menus, improved turnaround times, and so on –  he has a bigger challenge fighting the tarred reputation of multi-nationals. McDonald’s is among those global enterprises that many customers now avoid in favour of smaller independents often run by local people with a stake in the community and a willingness to offer something “off-menu”.

Big Mac may have entered the worldwide food lexicon but it has come to mean “big” in every sense. Including big problems.



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