McDonald´s used to be a winner in China, but has started to face dropping sales. Retail analyst Ben Cavender explains why the US firm is likely to keep on dropping in AsiaOne. Food scandals caused loss of confidence among the consumers, and McDonald´s has been unable to repair the damage.
The global sales still represented a sharp drop, however, from what analysts had estimated would be a 0.3 per cent fall in same-restaurant sales, according to those polled by research firm Consensus Metrix.
Those had included declines of 0.7 per cent in the US and 3.1 per cent in APMEA, said Reuters.
Ben Cavender, principal of the Shanghai-based China Market Research, said McDonald’s is likely to continue seeing weakening sales in China.
An undercover local Chinese TV report on July 20 showed workers at Shanghai Husi Food Co Ltd using expired meat and doctoring food production dates.
Regulators immediately closed the factory, which is part of OSI Group LLC, a US food supplier and McDonald’s partner.
Cavander said the company had been unable to rebuild confidence with consumers since the incident and he expected questions over the quality of its food supply to continue, and as buyers increasingly turn to healthier options.
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