McDonald's works to win Asia
The company is trying to rev up sales with new approaches.
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.
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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.
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.
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.
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.
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
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?
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.
fast food is hideous - esp. MickeyD's
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