Gloomy Economic Sign: People in China Are Eating Less McDonald’s — Dollars and Sense
Fast food sales are on the decline in China, as many popular junk food retailers in that part of the world have reported puny earnings in the third quarter.
Earlier last week, McDonald's posted its shakiest quarterly growth in almost a decade, while KFC/Taco Bell conglomerate Yum Brands watched fried chicken and taco sales growth drop from 19 percent in 2011 to 6 percent. Even soda superstar Coca-Cola took a loss, only experiencing a 2 percent growth versus the 11 percent they saw in 2011.
According to McDonald’s CEO Don Thompson, fourth-quarter earnings are not shaping up to be any better. "Global economies remain challenging and our comparable sales for October are currently trending negative," he said.
These declining sales figures appear to be the result of a jammed-up Chinese economy that, according to the National Bureau of Statistics, is at its lowest point since the beginning of 2009. Fast food isn't the only industry to take a hit. Analysts say that many multinational companies are reporting less than desirable earnings so far this year.