Well, 2009 is almost over and with the state of the economy as it was, I don’t think too many people will be sad to see it go. Virtually every industry has had a tough go of it this year, and the fast-food business has been no different.
We heard back in October that McDonald’s was pulling out of Iceland. Wendy’s is now retreating from Japan, where the pressure to compete with McDonald’s is just too great. The chain, which has been in Japan since 1980, is going to close all 71 of its stores there come the end of the year.
While this is bad news for investors in these companies, it’s music to the ears of people who like to eat at their restaurants. McDonald’s has announced that starting in January, it’ll be beefing up its $1 value menu with breakfast items. Breakfast sales are down, evidently because so many people have lost their jobs. (Perhaps that means these people are sleeping in till lunch?)
I’m not sure if these deals will be extended outside the United States, but it has got me thinking about McDonald’s and its Canadian profitability. A few months ago, I read From Russia With Fries, which is the memoir of McDonald’s Canada (and Russia) founder George Cohon. In it, he boasted about how the Canadian wing of the chain was among its most profitable.
I suppose that shouldn’t be a surprise given that the $1 American value menu goes for $1.39 here in Canada, despite the exchange difference being only about 5 cents. Is this another sign of how Canadians get hosed for everything? (i.e. our cellphones)