McDonald’s plans to open over 10,000 locations worldwide by 2027, perhaps marking the fast-food chain’s biggest expansion era ever, according to a statement released by the company.

Additionally, the firm announced intentions to grow its user base to 250 million subscribers by 2027 and treble sales from its loyalty programme to $45 billion. Currently, 150 million people use the programme, and system-wide sales of over $20 billion are generated annually.

Because of its active promotions, marketing activities, and reasonably priced menu items, McDonald’s has remained mostly unaffected by the choppy state of consumer spending in the United States.

During the business’s investor day, CEO Chris Kempczinski stated that the company has seen consumers to be “very resilient,” therefore he was hesitant to make any forecasts about the upcoming year.

According to CFO Ian Borden, McDonald’s plans to open over 7,000 locations in its worldwide developmental licenced areas, which include China, India, Japan, and Brazil.

More than half of the new locations, according to Borden, are slated for China, the second-biggest market for McDonald’s, where the company just reached an agreement that gives it more authority over operations.

By 2027, the increase would bring the total number of outlets to almost 50,000 worldwide.

By 2026, McDonald’s “Best Burger” campaign, which aims to enhance the quality of its burgers, will also be implemented in almost all markets, having presently just approximately 70 markets.

In contrast to the 1.5% growth it anticipates for 2023, McDonald’s projects approximately 2% rise in system-wide sales from new restaurants for 2024, on a constant currency basis.

“It sounds ambitious, but definitely exciting if they can execute it at scale… there’s no reason to think that they’re not able to achieve this,” Stephens analyst Joshua Long said.

The company added that the ongoing violence was having an effect on commerce in a number of Middle Eastern areas as well as a small number of markets outside the region.

Additionally, McDonald’s teamed up with Alphabet’s Google Cloud to roll out artificial intelligence (AI) solutions across all of its locations globally. This would allow the business to see more into each location, save money, and expedite the delivery of hotter, fresher meals to customers.

On Wednesday, shares of McDonald’s closed unchanged. The stock has increased by roughly 8% so far this year, trailing the benchmark S&P 500 index’s 19% gain.

(Adapted from BusinessTimes.com)

Categories: Economy & Finance, HR & Organization, Strategy, Uncategorized