McDonald's Shrinks Menu, Gives Up On Healthier Foods To Drive Profit
McDonald's trimmed nutritious foods from its menu, such as salads, grilled chicken sandwiches, and fruit and yogurt parfaits, a move to streamline operations and offer faster drive-thru times with less staff.
BTIG LLC analyst Peter Saleh told Bloomberg that healthier foods wouldn't return to McDonald's anytime soon, which should increase profitability amid soaring commodity and labor costs.
McDonald's has lowered drive-thru wait times by 30 seconds since the pandemic because of the menu cut.
"With the shortage of labor, you're trying to keep your menus as streamlined and as simple as possible," Saleh said. "For many of these restaurants, their menus get bloated with some of these new items, and then you cut it off to help with speed."
The new strategy of a "simplified menu enables speed," said the National Owners Association, a large group of McDonald's franchisees, told Bloomberg. The group said the key to sales growth in these challenging times of soaring costs and lack of labor is an efficient car lane: "We love fast drive-thrus, happy customers, and happy crews."
Health-conscious consumers are the biggest loser from McDonald's new skinny menu. The company said customers' appetites fuel menu changes:
"Our transition to a limited menu, involving taking dozens of less popular national and regional items off menus, helped simplify operations for our restaurant crew while also improving our customers' experience.
"We continue to evaluate our menu through this lens to improve order accuracy and speed," McDonald's said.
Food industry research firm Datassential found restaurant menus in the last few years have been reduced by more than 10% on average. At least 60% of restaurants in 2021 shrunk their menus, axing appetizer, dessert, and beverage categories. Burger King is another fast-food restaurant chain that recently removed salads.
Tom Cook, a principal at restaurant consultancy King-Casey, said McDonald's' healthy options were never a significant revenue driver.
"You always need to have something, some news to drive traffic, particularly these days," said Cook, who worked with McDonald's in the mid-2000s to help introduce a handful of new salads, including one with apples. He said the leafy-green entrees were a big deal at the time — even though management knew they'd never rival burgers sales. The goal with salads was to draw in female diners and especially mothers with children, he said.
"Here's a case of knowing that it's never going to be popular and sell a lot, but we're going to make a big story out of it to communicate that we're healthy," he said. "It was a very high priority." Fast forward to today, and "they're just probably saying, 'we don't really need those,'" Cook said. -Bloomberg
Lindsay Moyer, a senior nutritionist at the food/health watchdog Center for Science in the Public Interest, said McDonald's is taking "a huge step backward" by axing healthy items at 13,000 US locations.
"You have to wonder if McDonald's has almost given up trying to pretend they have something to offer people who want healthier items," Moyer said.
Wonder how McDonald's ESG score will fluctuate after the new unhealthy menu continues making Americans even more obese.