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Fast-food giant McDonald's has reported its first monthly drop in global sales in almost a decade, with tough economic times in the US blamed.
McDonald's has reported its first monthly drop in global sales in almost a decade.
The Wall Street Journal reported that the fast-food chain's global same-store sales fell 1.8 percent in October — its first monthly sales drop since 2003 — owing to slowing consumer demand.
Economic hardship was blamed, with diners turning to more price-conscious competitors, including Burger King and Wendy's, the Chicago Tribune reported.
However, while sales at McDonald's restaurants in Octoner fell 2.2 percent in the US and Europe, but 2.4 percent in the Asia-Pacific region, Middle East and Africa.
The drop came despite impoved breakfast offerings, improved coffee options and more innovative salads, but competitors have responded by re-doing their menus, pushing "value" offerings to compete with the McDonald's Dollar Menu.
The sales slump sent shares to a year low.
The company's new CEO Don Thompson said:
"Though October's sales results reflect the pervasive challenges of today's global marketplace, I am confident that our strategies and the adjustments we are making in response to the current business headwinds will build sales momentum and drive sustained, profitable growth."
Reuters reported that many restaurant companies had reported cooling demand as diners spent less to cope with tough economic times.
Reuters cited Edward Jones analyst Jack Russo as saying that Thompson, who took the helm at the world's biggest hamburger chain on July 1, was not to blame:
"This has nothing to do with Don being in charge. It's just a matter of bad timing and bad luck. They'll get through it."
He also warned that Hurricane Sandy was likely to weigh on November sales but that McDonald's was likely to answer the challenge with stepped-up promotions.