| Under siege'
New York, Dec. 8: The McDonald’s burger chain, trademark of the American way of life and symbol of its expansion across the world, has been forced into retreat by a series of setbacks at home and abroad.
A surprise decision last week by Jack Greenberg, the McDonald’s chairman and chief executive, to retire early was only the latest symptom of the many ills afflicting the giant corporation and its rivals.
The firm is beset by a series of difficulties, not least the sense that the nation which made the hamburger, fries and milk shake meal into an international symbol of prosperity is slowly beginning the search for a new menu far away from the Golden Arches.
Too fat for its own good, America has had its fill of fast food.
McDonald’s arches and clown mascot have become the victims of poor financial performance, a domestic price war and the upwardly mobile tastes of consumers.
Abroad, the corporation remains a magnet of hate for radical groups around the world. Last week’s bombing of a McDonald’s restaurant in Indonesia, which left three people dead and 11 injured, appeared only the latest attack on a brand which has come to represent US consumer culture.
For whatever reason, McDonald’s corporate headquarters in Oak Brook, Illinois, recently announced it would close all its outlets in three unnamed countries in Latin America and the West Asia. Within the US, supersized Americans are stuffing themselves with excessively large quantities of unhealthy food as never before — yet their appetite for McDonald’s is in decline.
The corporation has resorted to increasingly desperate measures to lure back the crowds, among them a “dollar value menu” cutting prices on items such as the “Big N’ Tasty”, “McChicken” burgers and “Mozzarella Sticks”.
Nevertheless, the company’s stock price hit a seven-year low this autumn, revenue from its US stores is down and the champion of fast food chains now no longer has the most US outlets, having been overtaken by Subway. Burger King is feeling the pain as well, with its second largest US franchisee, AmeriKing, filing for bankruptcy.
To add to its woes, McDonald’s now has to fight off a lawsuit from a group of chronically obese New York teenagers who blame its food for their size and diseases like diabetes, heart problems and high blood pressure.
The spectacle of 25 youngsters suing the company — one of their fathers swore that he “always believed that McDonald’s was healthy for my children” — may have some blackly comic moments.
As a legal precedent for damages, however, the case is anything but funny, threatening the fast food sector with the sort of ruinous litigation suffered by the big tobacco firms.
At the root of the industry’s problems lies the saturation of Main Street, US, with fast food outlets and the changing tastes of Americans going out for meals.
Having brought restaurant fare within reach of blue collar families in the 1950s, McDonald’s and others like it now find that today’s mass consumers are slowly outgrowing the traditional take-out burger-and-fries formula. The McDonald’s menu has gradually evolved over the years, but the changes have lagged well behind the shifts in expectations and income of the majority of Americans.
To hold its own against the new competition, after years of expansion, McDonald’s has embarked on a cull of up to 1,000 older branches and the refurbishment of some 6,000 others.
To broaden their appeal, newly-opened McDonald’s across the States have included Aztec themes or targeted wealthy Florida pensioners with flower arrangements and Impressionist reproductions for decor.
In the US, the future for McDonald’s seems to lie in restaurants with “character” rather than the grim, anonymous eateries familiar in the UK. But the company’s efforts to recruit new customers can backfire.
One mother on Manhattan’s posh Upper East Side was recently shocked to receive advertising in the post from McDonald’s. It was targeted at her new-born baby.