The Global McDonald's Sales Slump: Bad, but Not Getting Worse

McDonald’s warned investors this summer that the expired meat incident in Asia would dent global sales for the year. Three months later, here’s what the impact looks like: Worldwide comparable sales for the year ended in October are down 1 percent, with the steepest declines coming in the Asia/Pacific, Middle East, and Africa region (off 2.9 percent) and the U.S. (down 2.1 percent).

Despite its problems, McDonald’s global same-store sales managed to stay positive until July, when the China supplier issue first surfaced and devastated markets in Asia that together make up 10 percent of McDonald’s global sales.

The encouraging news for McDonald’s is that the impact in Asia is waning. Monthly same-store sales in the broader region dropped 4.2 percent in October, an improvement over the 14.5 percent slump in August.

Of course, the food-safety scare in China doesn’t help explain why comparable sales in the U.S. have been consistently negative or flat this year. Don Thompson, McDonald’s chief executive, addressed the issue in Monday’s press release, saying the company understands that ”consumers increasingly prefer customizable food options, dining in a contemporary, inviting atmosphere and using more convenient ways to order and pay for their meals.” Those are the same solutions McDonald’s has been hyping for a while.

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