The Changing Fast Food Industry

Posted on 12/14/2014by costsavingsexpert

Fast food is popular among many because they are quick meal solutions to make everyone’s lives easier.  American’s enjoy their fast food and emerging markets are no exception making them one of the fastest growing in the industry. Over the years though fast food restaurants have been feeling increased pressure because of the rising food costs and health conscious consumers particularly Millennials.  Millennials are the ones that reached young adulthood around 2000.  They are the children of the post-WWII baby boomer generation that are known to enjoy fresh ingredients and watch what they eat.  Companies such as Panera, Chipotle, and Starbucks are doing well with the healthy trend while longtime fast food chains such as McDonald’s, Burger King, and Wendy’s have reported a decline in revenue.  Statistics over the years indicate high-income Millennials and low-income Millennials have declined in the consumption of fast food all together.  The fast food industry has taken notice citing customers are paying more attention to nutrition than in previous years.  Traditional fast food chains bottom lines are showing a gradual decline and customer visits to traditional fast-food hamburger chains declined 3 percent from a year ago.  McDonald’s recently had a bad sales slump where same-store sales dropped 1.5 percent for the third straight quarter.  The company reported a 4.6 percent decline in U.S. sales for the month of November.  People are focusing more on the quality of food and market saturation is another reason why sales are down for McDonald’s. McDonald’s is in every town with increased competition from restaurants that offer similar products at relatively the same prices.

The fast food industry is doing its best to change the “bad food” image for 2015.  The New Year has fast food chains seeking to remove their reputation as serving reheated meals loaded with chemicals.  They are rethinking the use of artificial preservatives and want to prepare foods more fresh.  Quick service restaurants want to be recognized as more of a “clean label” with McDonald’s President Mike Andres outlining improvements to include simplification of ingredient labels. More changes are on the way for McDonald’s because Andres feels there should not be as much preservatives in their food.  Subway is also becoming more health conscious by having their chicken strips free of artificial preservatives and flavors.  It will remove an ingredient from its bread that many did not like because the same ingredient was used to make yoga mats.  Chick-fil-A is removing high-fructose corn syrup from buns and artificial dyes from its dressing and has plans to serve only chicken free from antibiotics in the next five years.  Carl Junior recently introduced an “all-natural” burger with no added hormones, steroids, or antibiotics.  Quick service restaurants understand consumers are becoming more educated, discriminating, and adventurous with regard to eating healthy.  Restaurants are doing their best to stay ahead of consumer trends and change their image to attract more healthy eaters.  Will this work for the fast food industry?  Only time is the best indicator.. What we do know is that there has been a switch among people to go the freshly made clean cut meat route with limited artificial flavors and preservatives.  Chains preferred among people now implement innovative technology to their website and apps to make it more convenient for consumers to gain knowledge about their products.