January 24/Oak Brook, Ill./McDonald's Corp. -- McDonald's is turning to a pipeline of new menu items to boost slumping sales, starting with “Fish McBites.”
The company is betting that it will be able to beat back intensifying competition and economic pressures with the lineup, which executives said includes new burgers, chicken entrees and breakfast offerings that are performing well in test markets. The Fish McBites, which will come in three sizes and use the same Alaskan pollock used in the Filet-O-Fish, are set to be launched as a limited-time addition in February.
The stepped up offerings come after McDonald’s managed to eke out a higher profit for the October-to-December period with a series of short-term maneuvers, such as touting its Dollar Menu, shifting the release of its McRib from October to December and pushing franchisees to stay open on Christmas.
In November, the company ousted the president of its U.S. business after a key sales figure dropped for the first time in nearly a decade. CEO Don Thompson said that the figure is expected to drop again in January.
“By no means do we think 2013 is going to be an easy year,” Thompson said in a conference call with analysts. He noted that growth in the restaurant industry has been relatively flat-to-declining around the world, with that trend expected to continue.
In addition a more “robust” pipeline of new products, McDonald’s executives said they’ll boost sales by continuing remodeling efforts and extending store hours around the world.
Although McDonald’s said it increased its U.S. market share this past year, the chain is facing tougher competition from traditional rivals such as Burger King, Taco Bell and Wendy’s, which have been revamping their menus and posing a bigger threat. In addition, people are increasingly heading to eateries such as Chipotle and Panera that offer higher-quality food for slightly higher prices. To help keep its menu fresh in the face of such competition, McDonald’s has said that it plans to increase the frequency of its limited-time offerings.