McDonald's reports dip in sales as competition beefs up

McDonald's reports dip in sales as competition beefs up

According to the company’s latest global comparable sales report, it seems consumers in Asia, Asia Pacific, the Middle East and Africa are taking their money elsewhere, as sales in those regions fell the most at 2.4 percent in October compared to the same period the year before.

The dip in sales, meanwhile, coincides with a few significant shake-ups to the fast food landscape in Asia and the Middle East.

For example, after pulling out of Japan in 2009, Wendy’s re-entered the market last year.

Other major competitors include MOS Burger, the second largest fast food franchise in Japan after McDonald’s with 1,305 restaurants in Japan and 200 outlets in China. Last year, the brand announced ambitious plans to beef up its international presence by opening outposts in Europe and the US.

Mid-sized burger brands becoming big-time rivals

Meanwhile, popular mid-sized US burger brands like Smashburger, Shake Shack and Fatburger are also expanding beyond their borders.

Popular New York burger institution Shake Shack, for instance, opened its first international outposts in Dubai and Kuwait recently, while Denver-based Smashburger announced plans to take its brand to the Middle East as part of international expansion plans.

Fatburger likewise will be exported out to Asia, in countries like China, Hong Kong, Taiwan and Singapore.

Sales also dipped in the US and Europe by 2.2 percent, the company said, where mid-sized burger chains are becoming big-time rivals, and where alternative fast and casual foods including brands like Chipotle, Subway and Pret a Manger and fast ethnic fare are encroaching on their sales.

Overall, global comparable sales decreased by 1.8 percent in October.