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McDonald's Steve Easterbrook

Could all-day breakfast turn the corner as McDonald's sales slip?


By Noel Young, Correspondent

March 31, 2015 | 4 min read

McDonald’s, the world’s biggest fast-food chain, is looking at all-day breakfast as a way to revive flagging US sales and Egg McMuffins could be lead the way

McDonald's fights back

The company has confirmed reports that it plans to test all-day breakfast next month in the San Diego area, which could determine the feasibility of expanding what has become arguably its most popular daypart.

McDonald’s has made it clear that it was urgently seeking ways to evolve to meet the changing needs and preferences of consumers.

The move is a sign that new British chief executive Steve Easterbrook is willing to experiment with a range of measures to reinvigorate flagging sales, said the Wall Street Journal .

“We know our customers love McDonald’s breakfast and they tell us they’d like to enjoy it beyond the morning hours,” Terri Hickey, a spokeswoman for McDonald’s, wrote in an email to Nation’s Restaurant News.

“So next month, we will begin testing all-day breakfast at select restaurants in the San Diego area.”Hickey said it was premature to speculate” on any potential outcomes with the test.

A franchisee familiar with the plans told NRN that the test would follow a “McBrunch” test in a small Midwestern market, in which some breakfast items are sold until 2pm But the San Diego test would be a full-fledged, all-day breakfast test.

McDonald’s domestic systemwide sales fell 1.1 per cent in the US in 2014, its first domestic systemwide sales decline in at least 30 years. Sales have struggled in 2015, too, including a 4-per cent same-store sales decline in February.

Despite that, breakfast has been the chain’s strongest part of the day with sales holding steady.

More consumers are demanding breakfast items after the morning hours. According to the National Restaurant Association, 72 per cent of adults said they wished restaurants offered breakfast items all day. Among younger Millennial consumers, that number rises to 77 per cent.

Until now McDonald’s breakfast daypart has ended at 10:30am All-day breakfast has seemed out of the question.

“McDonald’s has been working to simplify its menu, and breakfast would only complicate matters, hurting the chain’s trademark speed,” said Nation’s Restaurant News.

McDonald’s has suggested that the size of its restaurants’ grills make breakfast past 10:30am operationally difficult - but stll they are going to have a go.

McDonald’s makes many of its breakfast items fresh, while other quick-service chains use microwaved eggs.

Experts say all-day breakfast would be easier and cheaper than McDonald’s other sales-expansion plan: Create Your Taste. McDonald’s is testing its burger and chicken sandwich customization platform in restaurants across the US.

There would also be considerable buzz should McDonald’s make breakfast available all day — given the popularity of the daypart.

One observer said the two most craveable items on the McDonald’s menu were its French fries and breakfast items such as McMuffin permutations and the “utterly delicious McGriddles.”

McDonald's Steve Easterbrook

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