Posted on 05/03/2024 6:46:20 AM PDT by Red Badger
Economy, other factors have put pressure on consumers
People seem to be buying less food from quick-service restaurants (QSR).
That appears to be the case after companies such as Yum! Brands, Starbucks and McDonald’s offered their latest quarterly updates on their businesses.
In the first quarter, the corporate parent of KFC, Taco Bell and Pizza Hut said its overall same-store sales narrowed by 3%, which was "expected," said Yum! Brands CEO David Gibbs in the company’s press release Wednesday.
CFO Chris Turner told analysts and investors who tuned into the earnings call that Yum! Brands had expected the first quarter to "be our most challenged" in terms of same-store sales "due to prior year lapse, a return to a more normal inflationary environment and discrete consumer demand pressures, including markets impacted by the Middle East conflict."
Of the three major brands owned by Yum! Brands, Pizza Hut and KFC both experienced decreases in same-store sales in the first quarter, at 7% for the pizza chain and 2% for the fried chicken chain. But the same metric at Taco Bell went up 1%, according to the company.
"As far as the international consumer goes, it’s probably more of an emphasis on value than there has been in past quarters," Gibbs said about KFC. "We are seeing the same thing in the U.S."
In the earnings release, he also said Yum! Brands was "encouraged by strong 2-year same-store sales growth and positive momentum exiting the quarter" for its chains.
There was a decrease of 4% in Starbucks’ global comparable store sales for its second quarter. That, the company said Tuesday, was "driven by a 6% decline in comparable transactions, partially offset by a 2% increase in average ticket."
"Headwinds discussed last quarter have continued in a number of key markets; we continue to feel the impact of a more cautious consumer, particularly with our more occasional customer, and a deteriorating economic outlook has weighed on customer traffic and impact felt broadly across the industry," CEO Laxman Narasimhan said. "In the U.S., severe weather impacted both our U.S. and total company comp by nearly 3% during the quarter. The remainder of our challenges were attributable to fewer visits from our more occasional customers."
McDonald’s, known for menu items like the Quarter Pounder and Big Mac, said its first-quarter comparable sales went up 1.9%. In comparison, it showed increases of 3.4% in the prior quarter and 12.6% in 2023’s first quarter.
Chris Kempczinski, the CEO of McDonald’s, said it was "clear that broad-based consumer pressures persist around the world."
"Consumers continue to be even more discriminating with every dollar that they spend as they [face] elevated prices in their day-to-day spending, which is putting pressure on the QSR industry," he said. "It is worth noting the Q1 industry traffic was flat to declining in the U.S., Australia, Canada, Germany, Japan and the U.K. And across almost all major markets, industry traffic is slowing."
Many quick-service restaurants, including McDonald’s, Yum! Brands and Starbucks, have been emphasizing value and deals amid the current economy that has pushed some consumers to prioritize eating at home more to save money.
And some others in the industry, meanwhile, experienced comparable sales growth in their most recently reported quarters. Chipotle and Restaurant Brands International were among them.
Yum! Brands, Starbucks and McDonald’s each have a major global presence, with each having tens of thousands of locations around the world.
Yes, I remember I had a hard time holding it. Not a problem today.
We went to our local McDonald’s back last summer for the first time in well over 20 years, maybe even 30.
We ordered two ‘Big Macs’. They were a whole lot smaller than what we remembered. How can they even call them ‘BIG’?
When we want burgers, we go to a local chain burger place that is drive-thru only. Always a line of cars there.
Big fat juicy greasy burgers just like we had in the 50’s and 60’s before the national chains took it all over................
Like with McDonald’s and Kentucky Fried Chicken, Wendy’s service is all over the map. The one here in Scottsdale, AZ is very nice, with old ladies taking the order.
US Inflation Calculator says 59 cents in 1972 is $4.41 today.
When we go on trips we take chicken salad sandwiches using Costo’s canned chicken. We put them in a cooler with bottles of water (or soda) and separate lettuce that we put on the sandwich when we eat them. We also bring a few carrots and celery or snap peas. It costs practically nothing, tastes great and it’s safer.
When we’re home and it’s been a very busy day our local grocery store has take-out bistro meals that are half the price of take-out and you don’t have to pay a tip to a distracted kid who just hands you your food. I see some people buying multiple ready to eat meals. They much cheaper and have less salt than the drive-thru places.
“eating out was not even thought of when she was growing up”
My “eating out” treat was that Mom and Dad took me to a restaurant on my birthday, JUST for a half cantaloupe with a scoop of ice cream in it. I get that it could be done at home, but it was the going-out that was special.
Sometimes the Volunteer Fire Dept. would barbecue chicken and Dad would bring some that home (sometimes but not often) — pieces of chicken, cole slaw, and a roll.
That was about it for us.
Our town had a Freddy’s open up last year. We went once. It was odd. I think the meat was what we used to call minute steak. Tasted fine, but a bit chaotic inside.
Would go back and try again.
Never heard of Culvers.
You forgot the gold standard of surly service, Wingstop.
I had wondered why Steak and Shake had gotten so bad.
I had to take my six year old grandson with me to work this morning for an hour so we hit MickeyD’s. With a discount to $3 for the bagel, I got a steak, egg and cheese bagel, an order of pancakes, a sweet tea and a diet dr. pepper and it was almost $11.
LOL, I have a corned beef in the back of my freezer as well -bought, just as you said, when they were on sale after St.Pat’s Day.
My local grocery store usually has a “meat of the week” on sale, and often another coupon for more savings on that same item - or two for one packages of chicken, so I buy what’s on sale and definitely stock up on the chicken, especially since it’s organic, free range - great to cook with b/c it’s not loaded with water the way the regular chickens are - those dilute whatever I’m cooking, especially in the crock pot.
My mother’s favorite was pot roast so I cook it in her honor - but my family loves loves loves it. It’s in my crock pot now with a mushroom gravy that we like.
I’m starting to enjoy cooking at home now more than ever and the savings has been the best part.
Yes, my parents rarely EVER ate out growing up. My mother's mom would take her to Horn and Hardart Automat once a year on her birthday.
Usually one or another grocery store has some meat on sale nearly every week. When the price becomes good enough, like you do, I stock up.
The only thing I’m willing to pay a premium price for is prime cuts of steak from either Costco or Sam’s, and that’s so that we can enjoy a lovely steak dinner that we prepare instead of going to a steakhouse and pay three or four times the price. I have no need for doing that when my husband can grill a ribeye or NY strip as well as any executive chef, and I make all the sides. I rarely see the point in eating out, unless I really don’t feel like cooking one night, and then we might order pizza or Chinese takeout, which I’ve never mastered (egg rolls especially). I do wish I had a really great pizza dough from scratch recipe.
The burger that I had from Culver’s up here was plump and juicy, not flattened though I do like a good smashburger. Hubby’s are my favorite. I’ve never had a fish sandwich from there. It’s been years since I had a fast food fish sandwich from anywhere. I always wonder, is it even fish?
You have to tell me the name of your drive thru place for the next time I go back to Okaloosa, sometime this summer. I will make a fast food exception for places that make burgers like we had in the old days. Those places rarely disappoint.
TOPS Burgers.
There is one on Beal Parkway about a mile and a half North from 98 and one in Niceville on John Sims Parkway across from McDonald’s....................
https://www.facebook.com/people/Tops-Choice-Hamburgers/100048712636393/
“Notice that there are almost NO families eating at McD anymore.”
Well, as a near-daily McD customer (breakfast, sometimes filet of fish or chicken nuggets later, typically on app reward points), I can confirm that..
What you do still see are grandparents taking their young grandchildren out.
Most every morning I get egg&cheese biscuit, substitute round egg & extra cheese, two hash browns and medium drink for $8.08. Many people don't know to order to take advantage of discounts or too lazy to use app and acquire points.
Thank you, much obliged! You are my go to for info in that area!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.