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McDonald's is trying to avoid losing customers as he embarks on the "biggest construction project" in the company's history, CEO Steve Easterbrook said Tuesday.
New menu items might help. Easterbrook hinted at new upcoming offerings, including a "classic meal offer" and new breakfast options.
In a conference call with analysts on the company's quarterly results on Tuesday, he also acknowledged that the company's efforts to modernize its restaurants – known as "Future Experience" restaurants – had had a bigger than expected impact on the traffic and sales of franchisees.
Earlier this month, hundreds of McDonald's franchisees met in Florida to discuss the creation of an independent association "to work with McDonald's to make an impact." positive on the system, in the interest of franchise owners, our employees, our customers, the company and ultimately our shareholders ". a summary of the meeting posted on the website of the new National Owners Association.
"You can expect us to work with our owner-operators. Any constructive idea that we are absolutely open to, "said Easterbrook.
Wall Street reacted favorably to McDonald's third quarter results, which outperformed analysts' earnings and profit forecasts. But traffic was down in the third quarter in US restaurants, the company said. Easterbrook said the company's US company was in the process of preparing the renovations.
Same store restaurant sales in US restaurants – restaurants open at least 13 months ago – increased 2.4% in the quarter, driven by growth in the average number of customers, particularly orders placed in restaurants. new self-service order kiosks and deliveries.
But labor costs have also increased, in part because of renovations, said CFO Kevin Ozan. And restaurants that have been partially or completely closed for renovations have resulted in more "downtime" than expected in terms of sales and traffic, Ozan said.
This year, McDonald's plans to modernize more than 4,000 US restaurants, bringing the total number of refurbished sites to approximately half of the company's 14,000 US restaurants. The plan is to reorganize most of the standalone American restaurants by 2020. Experience of the Future stores include touch screen kiosks, more modern decor, table service and delivery.
Worldwide, McDonald's reported a 4.2% increase in store sales for the fiscal quarter, marking a 13th consecutive quarter of comparable and positive global sales.
Overall, McDonald's reported revenue of $ 5.37 billion for the quarter ending September 30, a 7% decrease from the same period last year, primarily due to the company's efforts to transform more corporate-owned stores into franchise-owned stores. Net income was $ 1.63 billion, down 13% from last year.
Twitter @GregTrotterTrib
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