McDonald’s to Debut Tiered Value Menu Nationwide Amid MCD ‘Challenges’

Will replace its regular dollar menu

   

McDonald’s to Debut Tiered Value Menu Nationwide Amid MCD ‘Challenges’

McDonald’s (MCD)  14,000 restaurants in the United States are set to debut a new Dollar Menu & More beginning Nov. 4, which will replace its usual dollar value menu.

The tiered value menu will offer $1 items from the Dollar Menu, but include additional low-cost price points, such as sandwiches for $2 and other items around $5.

“This is one of the ways that we can maintain the Dollar Menu in the face of rising commodity and labor pressures, but also get a little more margin basis on some of the products at $2 and some of the products at higher price points,” chief executive Don Thompson said during McDonald’s third-quarter earnings call.

“The franchisees support this.”

From Restaurant News:

The introduction will follow a third quarter in which same-store sales rose only 0.7 percent in the United States, when McDonald’s tried to build sales of new core offerings by moving the Monopoly game up into July and putting a major national ad campaign behind the Mighty Wings limited-time offer. However, Thompson said, while those initiatives performed within expectations, they did not offset traffic weakened by lower consumer confidence and a drag on discretionary spending.

According to a research note from securities analyst Andy Barish of Jefferies, same-store sales in the United States dipped 0.1 percent for McDonald’s, and comparable sales are tracking flat for the month of October.

The stagnant informal-eating-out market is not expected to improve in the fourth quarter in the United States, Thompson said, making the rollout of Dollar Menu & More even more important.

McDonald’s continues to debut new or limited-time offerings, such as its recent Mighty Wings.


Article printed from InvestorPlace Media, http://investorplace.com/2013/10/mcdonalds-debut-tiered-value-menu-nationwide-amid-mcd-stock-challenges/.

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