Maccas’ praise for Aussie strength

McDonald’s Corporation has singled out the Australian arm of its global hamburger empire as one of its best performers.

McDonald’s stores in Australia have earned praise from their US parent Picture: AFP

US multinational McDonald’s Corporation has singled out the Australian arm of its global hamburger empire as one of its best performing regions through the coronavirus pandemic, with the local chain’s drive-through proving an invaluable asset for contactless food sales.

In an update to US analysts, McDonald’s chief financial officer Kevin Ozan nominated Australia as a very strong market at a time when store closures and a dive in breakfast sales were hurting the group.

“Australia has probably been one of the stronger markets certainly as they remained open similar to the US. They’ve seen big increases in drive-through business and they’ve been kind of consistently remaining positive comp sales,’’ Mr Ozan said.

McDonald’s Australia CEO Andrew Gregory said the fast food company’s drive-through infrastructure was essential in the robust performance from March when social distancing, home isolation and lockdowns impeded customer mobility.

However, much like the rest of the McDonald’s empire, in Australia there was a decline in breakfast sales and the chain’s popular coffees as people working from home were not stopping off on the way to work.

“At the end of February, at that point the change we saw in consumers was they definitely shifted even before restrictions happened. Customers were shifting to drive-through and obviously we were in a strong position,’’ Mr Gregory said.

“The facilities are strong and locations of the real estate are also very strong, so customers voted with their feet — or rather their wheels — and started using drive-through pretty much immediately. We saw an increase in drive-through, a slight slow down in customers coming into the dining rooms, and then also the other platform for us — delivery — which was strong.’’

Mr Gregory said customer behaviour leapt ahead of government regulations, with April a tough month as people stopped going to football and activities like kids sport were cancelled.

“We suffered because of a lack of activity in the community but again customers trusted our drive-through and delivery, and we were also able to introduce our essentials range where people could come and get their bread and milk from us without having to get out of the car. That put us in a strong position.”

Changing work patterns, home isolation and people staying close to home affected store traffic through the day.

“Sales were concentrated at lunch, our lunch business grew but it wasn’t growing sufficiently to compensate for the lack of activity on the normal commute and also our late night, after dinner (business) as people were not doing their normal thing of going to the theatre, the cinema, pubs and clubs, that activity stopped as well. Our store managers, franchisees did a magnificent job in changing the way we operated, making sure we adhered to government restrictions as well as we did and then adjusting our business so quickly to meet changing habits.’’

Mr Gregory said sales were back to growth in May and June compared to the same time last year, with contactless ordering and delivery a core operation of the business as it also deals with states implementing different ­restrictions on in-store dining.