Sunday, June 21, 2015

If Fast Food Isn’t Fast, Hot, Cheap and Good Tasting - It’s Not Worth It

By Rich Kozlovich

On Friday George Will wrote this article, “McDonald’s, the ‘Progressive Burger Company’”  He starts out saying that In January, McDonald’s, leaning against the winds of fashion, said kale would never replace lettuce on its burgers” and that in May they “will test kale in a breakfast meal”, which according to Will represents 25% of McDonalds trade. 

Although predication – especially about the future – is amazingly hard I’m going to make one right now.  That 25% figure is going to drop like a stone if kale is forced on McDonalds’ breakfast customers.

But this isn’t the end of McDonalds’ efforts to turn their sagging sales around.  Now they say they will end using milk that uses growth hormones and chickens that are treated with human antibiotics, which of course is a logical fallacy.  These aren’t “human” antibiotics….they’re just antibiotics that humans use.  The goal is to kill harmful bacteria and what works to kill bacteria infesting the human body also kills bacteria that infest animals.  Now….did everyone get that?  That really isn’t all that hard to grasp, unless of course you’re a leftist loon making ridiculous demands that will raise the cost of food and lower the health of animals. 

The company has supposedly launched a new slogan, “Lovin’ Beats Hatin’ to turn things around.  Well, I never saw it and quite frankly, I didn’t know they had an old slogan, and didn’t care, and I’m willing to bet most people are in the same boat, and no slogan is going to make me buy McDonalds or Burger King or any other fast food.  Then there are plans to make a bunch of menu changes. Do they really believe all this will increase sales? 

Will goes on to say that “Progressives are forever telling us who is and who is not on “the right side of history.” Many fastidious progressives deplore, and try to control (witness San Francisco’s current crusade against soft drinks), other people’s food choices. It will be instructive watching the progressive burger company try to persuade its chosen constituents to stop at McDonald’s on the way home from Whole Foods, their environmentally responsible, because reusable, shopping bags overflowing with kale.” I think that’s a cogent observation.  The people pushing McDonalds into these silly programs aren’t their core customers. 

About 20-25 years ago one of the polling companies called me to ask if I ate fast foods.  Since I’m an exterminator I’m on the road all day long and …yes I said…. I eat fast foods.  The girl I talked to wanted to know how often, and I said about three days a week.  Then she wanted to know why I ate fast foods.  I said because it was fast, cheap, hot and tastes good.  She asked if I thought it was healthy.   I said no, but I didn’t eat it for my health.  (As a side bar – I’ve completely changed my views on the health aspect of eating fast foods by the way.  It’s no less healthy than the beef, chicken, lettuce, cheese, mayonnaise and pickles at home.  In fact it may be healthier since it’s grilled and not cooked sitting it’s own grease in a frying pan) I eat it because it’s fast, cheap, hot and tastes good.   She asked if fast food was healthier would I eat more of it.  I said no. She asked why.  I said I eat it because it’s cheap, fast, hot and tastes good and I don’t care about anything else.  That was almost impossible for her to grasp as she kept attempting to get me to say I wanted fast foods to be healthier, which is one reason I think people lie to pollsters.  She just couldn't seem to to grasp their core customers want fast food to be fast, hot, cheap and taste good with little concern for the claims and demands of leftists who don't eat fast foods.   

Unfortunately they’ve lost sight of who and what they are.  The food is fast, and hot, but it’s no longer cheap and it no longer tastes that good.  If I order two Sausage and Egg McMuffins (The sausage doesn't taste as good either) with a hash brown and a small coffee it runs almost ten dollars at the window.   I can get that cheaper in a sit down restaurant.  Let’s break this down.  They give us two eggs, two pieces of sausage, two slices of cheese two muffins cut in half a small hash brown and one cup of coffee.  I can get two eggs, two or three pieces of sausage, two slices of bread of my choice and an order of hash browns two to three times the size of McDonalds and a bottomless cup of coffee for seven dollars.  Maybe those two slices of cheese are what's so expensive.   

So what ‘s the real problem?  Is it possible the costs are all out of whack?  To own a McDonalds franchise a franchisee must start with at least $750,000in non-borrowed assets”and the start up can cost between over one or two million dollars.  Then there are the annual fees that can be over a million dollars a year. That’s a lot of burgers, fries, soft drinks, etc.  That's not mentioning a host of other minor fees.
 
McDonalds isn’t alone in this slump.  Burger King, Pizza Hut, Taco Bell, and KFC are all facing difficulty drawing customers and their franchise fees aren’t any cheaper.  Let’s get this right.  First -  the baby boomers who created the fast food boom are retiring at a rate that’s going to change the economics of every fast food business in America.  Secondly, the key for fast foods was it was fast, cheap, hot and tasted good.  That was foundational to success in fast foods.  It’s no longer cheap and it no longer tastes as good.  They’re losing their core customers because they’ve forgotten who and what they are.  And the younger people see it the same way! And no matter how it’s spun embracing leftist clabber isn’t going to save them.

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