McDonald’s global same-store sales growth sluggish in October

McDonald's Corp. reported on Friday a slight uptick in October U.S. and European same-store sales and a dip elsewhere that led to a global systemwide increase of 0.5 percent for the month.

U.S. October same-store sales rose 0.2 percent, a slight gain that the Oak Brook, Ill.-based chain credited to Pumpkin Spice Lattes, Mighty Wings and the new Southwest McWrap offers.

Same-store sales rose 0.8 percent in Europe. McDonald’s saw positive performance in the United Kingdom, France and Russia, but that was offset somewhat by declining sales in Germany “and other markets within the challenging eating-out industry,” according to the company.

Negative results in Japan contributed to a 2.8-percent same-store sales decline in the Asia-Pacific, Middle East and Africa region. In an earlier conference call, executives indicated Japan saw a 9.7-percent decline in October same-store sales.

Across that region, the company said in a statement, “McDonald's is striving to improve performance by providing consistent value offerings, accelerating growth at breakfast and leveraging brand extensions — drive-thru, delivery, kiosks and McCafé — to enhance the service and convenience of the customer experience.”

October sales comparisons in the U.S. were “dampened” by last year’s Monopoly promotion, which was moved up to summer this year, according to the company.

“Moving forward, the U.S. is intent on strengthening its underlying business momentum by evolving its everyday value options and balancing that with proven core favorites and relevant promotions that will add excitement and variety,” McDonald’s stated in a press release.

Earlier this week, McDonald’s rolled out to the U.S. system’s more than 14,000 restaurants an expanded and tiered value menu that replaced the old Dollar Menu. Tested earlier this year in five markets, the new value menu offers $1 items from the Dollar Menu, as well as sandwiches at prices around $2 and shareable items at around a $5 price point.

National advertising of the Dollar Menu & More offering is scheduled to start Nov. 11. Thompson said franchisees were supporting the new expanded value menu.

“This is one of the ways that we can maintain the Dollar Menu in the face of rising commodity and labor pressures, but also get a little more margin basis on some of the products at $2 and some of the products at higher price points,” said Don Thompson, McDonald’s president and chief executive,during a third-quarter earnings call.

McDonald’s has about 35,000 locations in more than 100 nations.

Contract Ron Ruggless at [email protected].
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