The Covid-19 pandemic has fundamentally changed the world of hospitality, changes that are profound and ongoing.
Anyone looking back and expecting a business landscape even resembling bye-gone days will become another casualty of the pandemic.
Business fundamentals have changed, are changing, and will continue to for some time before they settle down and become the new normal, a very different world will then emerge.
Trends of recent years are maturing and whilst they have always promised mainstream adoption, at least one is about to deliver on it.
We at H&C News for some time have admired McDonald’s, they research what customers want and deliver it. Not a new strategy, but like all business strategies the execution of it is what makes the difference, and McDonald’s offers an ongoing live case study in strategic execution.
Beyond Meat Down
Last week shares in Beyond Meat fell 16% after reporting year on year revenue growth of 2.7%. The company cited diminishing restaurant sales of 11% in the US alongside international restaurant sales crashing 65% as the reason.
McDonald’s Up
McDonald’s at the same time have not only weathered the pandemic but grown their business through it, prompting Chief Financial Officer, Kevin Ozan to announce that September 2020 was the best month for the company in almost a decade.
McDonald’s Q3 net income of $1.76 billion, is an increase from last year and shows remarkable resilience during the most challenging of times. Sales through McDonald’s digital channels delivered circa 20% of all revenue. Early adoption of digital continues to reap dividends for McDonald’s.
Beyond Meat and McDonald’s Join Forces
May 2019 saw Goldman Sachs, JPMorgan and Credit Suisse compete aggressively to be appointed as lead underwriters on Beyond Meat’s IPO. Prior to the onset of Covid-19 growth in Beyond Meat seemed unstoppable and everyone wanted a slice. But like many in hospitality, even many ‘super brands’ of hospitality, Covid-19 has proved to be an all too capable foe.
Beyond Meat has one priority, land grab, it needs to get product reach and distribution in line with the growth expectations of its investors.
To facilitate that Beyond Meat are partnering with McDonald’s on the launch of the McPlant burger. This has been widely applauded by the financial world and sees analysts forecasting annual sales of the McPlant burger at circa $300 million a year.
A smart move by Beyond Meat and an even smarter one by McDonald’s in our view.
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Hospitality & Catering News: McDonald’s plant based future – 16 November 2020 – McDonald’s plant based future.
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