McDonald's works to win Asia

The company is trying to rev up sales with new approaches.

By Kim Peterson Mar 20, 2012 5:00PM
Image: McDonald’s restaurant © AFP/Getty ImagesMcDonald's (MCD) is killing it in the U.S. -- but needs a little work in Asia.

Look at the company's February sales. The U.S. saw sales growth of 11% -- far more than what analysts expected. Sales in Europe rose 4%, still respectable but a little lower than what analysts were looking for.

But Asia and other parts of the world were a huge disappointment. Analysts projected an 8.1% rise, but McDonald's only came in at 2.4% growth.

That's got to change. So McDonald's is rolling out a number of new initiatives to try to beef up sales.

In Japan, it's testing a service that will let people place orders and pay for their food with a swipe of their mobile phone. Customers order and pass their phone over a special reader device to pay. The whole process takes 30 seconds.

McDonald's says that cutting that processing time by just 1 second will save several millions of dollars a year in Japan, according to the Nikkei.

One analyst gives his take on the company's February sales in the following video. The company had weather problems in Japan in the month, he said, and the Chinese New Year holiday shifted into January. He seemed to dismiss the problems in Asia.

Post continues below.
McDonald's has also rolled out a service that lets Japanese customers order from their car navigation systems and pay before arriving at drive-thru windows. The service works with the "Intel Transport System" that Japanese drivers already use to navigate the roads.

If the service is successful, McDonald's could extend the service to the U.K., which is getting lobbied to launch a network similar to the transport system in Japan, the Telegraph reports.

China is going to be the real test, and McDonald's will go head-to-head with Yum Brands (YUM), which owns Pizza Hut, KFC and Taco Bell. Yum already has a huge presence in China and is still rapidly expanding. Oh, and shares of Yum hit a 52-week high of $69.75 Tuesday.

McDonald's has more than 1,400 restaurants in China and wants to open 250 more this year, according to the Motley Fool.

McDonald's shares fell more than 3% earlier this month after the company missed some of those estimates for February sales. Shares still haven't recovered, and were trading Tuesday at $97.61. McDonald's shares have soared more than 32% in the last year.

Tags: MCDYUM
17Comments
Mar 21, 2012 12:25AM
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Shonan_sand – Sorry but you are grossly exaggerating the situation. I have eaten at various McDonald in the Tokyo area hundreds of times and I don’t recall ever having to wait any longer for my food than I do here in the States. And it taste exactly the same as well. I’ll admit that the overly enthusiastic and friendly greeting rituals that the employees are required to play out can be a little annoying at times but I much prefer that to the rude employees I sometimes run into here. Anyway what’s so bad about having someone vivaciously greet you every time you come into their shop and then thanking you for your business when you leave you leave? Maybe we could use a little bit more of that here.

Mar 21, 2012 12:11AM
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If McDonald's can make Americans    F A T    why not Asians?

Mar 20, 2012 10:13PM
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Just wondering if anyone has gotten a burger or fish sandwich that looked even a little bit like the picture on the menu boards? I wonder how good sales would be if the pictures showed the cheese half off the burger on one side, the meat half off the smashed bun on the other side, and much of the toppings on the wrapper like the ones they hand us to eat. Where else can you put out such a sloppy product and still have a job?
Mar 20, 2012 8:14PM
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Can any of you 5000 IQ people tell me in fact what meat do you KNOW that Mc DOnalds uses other than Beef??  Enlighten me.
Mar 21, 2012 12:18AM
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Before the Asians invest in McDonald's have them come to a typical McDonald's here in America.  In all likely hood these Asian investors would pack the bag and run home thankful they never made the investment.

 

 

 

 

 

Mar 21, 2012 2:36AM
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This idea of fast food is still relatively new to these rapidly developing countries. In these high density areas where the mcdonalds, kfc, pizza hut stores are at, they are still competing with the cheaper traditional food of rice, vegetable, and meat available at the small restaurant beneath your apartment complex. (about half the price) Convenience is of utmost importance here. 1 block could make a huge difference to whether your are successful or not. Mcdonalds has and is still eating up all of the best real estate here in China. Also, they have not really introduced the drive-thru phenomenon to the masses yet (is it even possible with the crazy traffic and limited area?) At the rate of people buying cars (in china) along with the median income rapidly increasing,  No doubt about it, they will continue to grow. Mcdonalds is great at snatching up the best retail spots, even if they are not super profitable now. It's a long term gain and they are making the right moves.

Mar 20, 2012 9:29PM
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What?  I came to this site and it's all about wall street BS?  I was wondering if McDonald's was introducing a new line of food, like fish heads and rice.  Or those half rotted eggs that you suck the half-developed chick out of...

 

Hey, I've witnessed all these events, no harm done, chill out you poor over-sheltered little "pee on your own leg" reporters

Mar 20, 2012 8:12PM
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So, what meat do they use if you are so sure that they don't use beef????
Mar 20, 2012 10:34PM
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japan has the slowest fast food service i've ever experienced. too many bows and too many meaningless words, not to mention the absurd wait for what u've ordered. fast food!!!!!!!!
Mar 20, 2012 7:31PM
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They may use cat in Asia for thier burgers, but I am still trying to figure out what kind of meat there using in the U.S? Any Ideas?

Mar 20, 2012 9:38PM
Mar 21, 2012 12:40PM
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McDonalds has decided they no longer need American beef for their business and I won't eat foreign beef and neither should anyone else that cares about their health.  The sooner they leave the states, the better.
Mar 20, 2012 9:36PM
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Sick cows, diseased cows, cows with fever, broken legs, cancer eye, birth deformities, if you ever saw what their cattle buyers were buying, you'd never go to Mc Donalds again...or Wendy's, or the others.  Now you freaks just shut your frigging pervert mouths... I've sat in sales arenas many, many hours...my boots have cow s--t on them...My after shave smells like sweat and leather...I cut teeth on a cow horn and was raised in the saddle...I know what I'm saying.
Mar 21, 2012 12:41PM
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They can make them convenient but they still taste like crap.
Mar 21, 2012 11:32AM
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Good idea. There are far too many Chinese workers competing with American jobs.

 

Let the fast food industry make them sick like it has us. Since they eat all kind of animals in China, Micky D's won't have to worry about what's in the "filler" for their hamburgers.

Mar 21, 2012 11:30AM
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That nasty garbage should go over well in asia.  I hear it tastes just like dog.

fast food is hideous - esp. MickeyD's

Mar 20, 2012 10:29PM
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If you like disgusting, the McRib is made of pig heart, tripe, stomach, and who knows what else. 

I don't even want to think about what's in those nuggets...
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