Domino effect: another fast-food boost

Click to follow
The Independent Online

Buckets of chicken, pizza and burgers now dominate the menu for Britain's penny-watching consumers as the recession proves the UK is still a fast food nation.

Today's announcement from Domino's Pizza that profits had grown almost a quarter in 2008, comes after a slew of upbeat results from the sector.

Consumers worried about the state of their wallets appear to be turning away from more conventional restaurants and staying at home with a take-away instead.

And while the rest of the high street struggles for survival, fast food chains are enjoying a surge in popularity.

KFC yesterday announced plans for a £150 million expansion, which would create up to 9,000 jobs in the next five years, sandwich chain Subway intends to open 600 new stores in the UK and Ireland adding 7,000 new staff, McDonald's plans another 20 restaurants and bakery chain Greggs is also looking to grow.

Meanwhile Domino's expects to open 50 stores this year - adding 1,500 roles - and predicts it will almost double its number of UK and Ireland outlets in the next ten years.

For McDonald's in particular, this return to fashion marks a dramatic turnaround from just a few years ago when the film Super Size Me by Morgan Spurlock typified the public's growing antipathy to the chain and fast food in general.

The 2004 film, which showed Mr Spurlock's expanding waistline and deteriorating health after living solely on McDonald's food for a month, contributed to negative publicity the chain could well have done without.

But in contrast to 2006, when McDonald's said UK sales had been in negative territory for a couple of years, the firm recently reported its "strongest ever" performance in 2008.

As with other fast food outlets, McDonald's has worked hard to revamp its image, adding Rainforest Alliance certified coffee and renovating its stores to appeal to a new, more discerning consumer.

KFC said it too has changed. The fried chicken chain said the idea of KFC as merely a take-away was "dated" as it increasingly focussed on drive-through restaurants and outlets that encourage customers to eat in.

Chief executive Martin Shuker said the firm had already spruced up many of its stores, with modern decor and more comfortable seating.

He said KFC was also attempting to attract a more health conscious consumer, with plans to test a grilled chicken option this year and by reducing the salt content of its food.

Some fast food chains are more explicit than others in crediting the slump in consumers' cash for their gains.

Mr Shuker said: "I think KFC is doing well because the taste and quality of our food is very strong and very distinctive and we do offer good value, so you can buy a bargain bucket and feed a family of four for a tenner, [which is] definitely appealing in these difficult economic times."

Domino's have also attributed some of their growth to new customers, drawn to the pizza firm as they cut down on eating out.

The firm has also said a culture of long working hours has meant people were increasingly reliant on prepared food. It added Domino's has a broadening customer base as the young adults originally attracted to take-away pizza had grown into their 30s, "taking their eating habits with them".

Greggs' chief executive Ken McMeikan has said the chain's quality and low prices gave it a head start of its rivals.

"The underlying factor out there is that people are looking at the amount of money in their pocket and looking for the best value," he said.

Comments