Bloomin’ Brands Struggles in Quarter, as Chain Restaurants Face New Chef-Inspired Concepts

November 9, 2015

Justine Griffin
© 2015 Tampa Bay Times

While the “anti-chain” movement across the U.S. isn’t new, it is slowing down sales at some of the best known restaurant brands, including Outback Steakhouse and Carrabba’s Italian Grill. Bloomin’ Brands, the Tampa parent of Outback and Carrabba’s, is the most muscular restaurant company in Tampa Bay with $4.4 billion in revenue last year and 1,500 restaurants worldwide. But it’s anything but local to consumers here.

The company on Tuesday reported disappointing sales for the third quarter for most of its brands. CEO Liz Smith said casual dining as a segment in the hospitality industry was down from July to September, not just at their in-house brands.
“We knew the trends would be challenged,” Smith said. “And our marketing didn’t break through as expected.”

Bonefish Grill, which was intended to be the engine powering new growth for Bloomin’ Brands’ restaurant portfolio this year, saw the steepest declines, with sales down 6.1 percent for the quarter and traffic down 8.5 percent. It’s the second quarter of decline for Bonefish, which is in a competitive class of “polished casual” chain restaurants, and tends to be more pricey than dining experiences like a TGI Fridays or Olive Garden. The menu quality is more on par with restaurants like Seasons 52 or Carmel Cafe.

Carrabba’s Italian Grill reported a decline in the quarter of 2 percent sales and Fleming’s Prime Steakhouse & Wine Bar saw a 0.6 percent drop.

Outback Steakhouse, which performed well in new international markets like Brazil, was the only brand to report modest growth, at 0.1 percent, this quarter.

Chain restaurants are struggling to meet the changing trends fueled by younger demographics in the U.S., said Darren Tristano, executive vice president with Technomic, a restaurant research firm in Chicago.

“These are the same issues that most casual dining restaurants face today,” Tristano said. “Bloomin’ is no different than Darden” — the Orlando parent of Olive Garden and several other chains — “and most others in this regard.”

Another blow landed this summer when Bloomin’ Brands lost a bid to open an Outback Steakhouse and a Bonefish Grill in Tampa International Airport after $953 million in terminal renovations. The aviation authority board sought to make the airport’s restaurants feel more local, and one board member noted the company’s widely located chains made it feel less so. The Carrabba’s in the main terminal, which opened in 2008, is slated to close next spring.

Millennials and generation X-ers look for value but tend to try locally owned or chef-inspired restaurants rather than a chain, so it’s difficult for the casual dining chain restaurant to stand out in what’s become a very competitive market, Tristano said.

“It’s hard for chains to add more regional flavors to a menu, like local craft beer or local food options that the independent restaurants can do so easily,” he said. “They need to be more innovative and focus on the strengths that they do have, which usually is price, to get the attention of this next generation customer.”

Outback Steakhouse will roll out a new mobile phone app next year, which the restaurant chain has been testing in Tampa Bay. Through the app, customers can add their names to the wait list before they arrive at a restaurant, place take out orders and use to pay at the table.

“We will continue to invest in this kind of innovative tech platforms,” Smith said during Tuesday’s earnings call.

Carrabba’s Italian Grill will debut a simpler menu next year. Fewer items will be available, but the chain will add a new small plates category for tapas-style sharing at the table. Bloomin’ also changed the menu at Bonefish Grill earlier this year, with the same “less is more” theme.

“Too much on the menu overwhelms the customer,” Tristano said.

It also keeps food costs down, said Brian Connors, with Connors Davis Hospitality, a restaurant consulting firm in South Florida.

“Chains are the safe choice. Customers know what they’re going to get there and the restaurants know what they’re good at,” Connors said.

Bloomin’ Brands plans to continue to expand aggressively in new international markets like Korea and China. Much of the company’s growth has come from international openings this year.

“They don’t have to reinvent the wheel this way,” Connors said. But in this country, he suggested, they’ll need to come up with something new to keep attracting diners.

“We’ve entered this new age of adventure eating. Food recipes is one of the highest pinned categories on Pinterest,” Connors said. “People are willing and wanting to try something new.”

Bloomin’s brands: Tough quarter for sales
U.S. sales in the last four quarters
BrandQ3Q2Q1Q4 (2014)
Outback Steakhouse0.1 %4%5%6.4%
Carrabba’s Italian Grill- 2%2%1.9%0.3%
Bonefish Grill- 6.1%-4.6%0.9%0.7%
Fleming’s Prime Steakhouse & Wine Bar- 0.6%3.2%3.0%3.4%
Source: Bloomin’ Brands

Mcdonald’s Earnings Does the Company Think We’ve Reached Peak Burger

November 6, 2015

pictureBeth Kowitt

The company’s executives seem to have other products on their mind, if yesterday’s analyst call was any indication.
Where’s the beef? McDonald’s is the biggest burger restaurant in the world, but you wouldn’t have known it from its third-quarter earnings call yesterday. Executives at the fast food giant uttered the b-word a mere six times. Two of the mentions came at the beginning and end of the call when CEO Steve Easterbrook repeated that the company was repositioning itself to be a “modern, progressive burger company.” By comparison, the execs referred to breakfast 17 times and chicken eight times.

The rare mention of the iconic product that has long defined McDonald’s MCD 0.19% is a sign that being a “modern, progressive burger company” might means focusing a lot of attention on…other things.

“I think you’re going to see them become more and more about other things and less about burgers and fries,” says Edward Jones analyst Jack Russo. “They want to be seen as giving people choice and being more healthy.”

If you look at the numbers, it’s clear why. The U.S. public may be burgered-out. There are 50,000 burger restaurants in the U.S.—that’s one for every 6,300 people, according to industry analyst Aaron Allen, who says that Americans eat 46 hamburgers a year on average. Of all the sandwiches sold in the U.S., he says three out of every five are burgers, and more than two-thirds of all the beef we consume comes in the form of a patty on a bun.

Of course, there’s been a surge in at least one category: the ballooning “better burger” segment. Allen found that some 50 national chains—from Shake Shack to Five Guys to Smashburger—have plans to expand, which will add thousands of locations in the coming years. And the proliferation is not just at burger joints. Darren Tristano of industry research firm Technomic says that the burger is also popping up in unexpected places, such as on Olive Garden’s menu or integrated into tacos.

But the pace of growth of the better burger segment is not in line with the growth of burger consumption, which Allen says lags behind population growth. We are already one of the top beef-eating countries in the world. How much more beef can we stomach?

“The only growth is coming from cannibalization,” Allen says. “We’ve capped out on the number of burgers we can eat. They’re really just swapping dollars.” He thinks McDonald’s has taken the biggest hit, noting that if you look at the growth of units added in fast-casual hamburger restaurants in the last three years, that’s approximately equivalent to the number of locations McDonald’s has closed.

The fast-growing chicken sandwich is giving the hamburger a run for its money. According to research firm NPD Group’s Harry Balzer, 2044 will be the year the number of chicken sandwiches consumed at lunch at all chains will surpass burgers for the first time. “Hamburgers are not on a growth cycle,” Balzer says, “but they’ve got a place in our lives.” He says that the chicken sandwich is not cannibalizing from hamburgers; instead it’s a change in how we eat chicken.

Allen, who has done an analysis of McDonald’s menu, says there are now more chicken-related items than anything else on the its menu, and McDonald’s now sells more chicken than beef.

It makes sense if McDonald’s wants to go whole hog on chicken. But McDonald’s can’t forget its roots. As Fortune noted last year in a story detailing McDonald’s woes, the company has a perception problem when it comes to quality:
A survey in Consumer Reports showed that McDonald’s customers ranked its burgers significantly below those of 20 competitors. It also had the lowest rank in food quality of all rated hamburger chains in the Nation’s Restaurant News 2014 Consumer Picks survey. Worse, McDonald’s ratings among diners put the chain at No. 104—on a list of 105 restaurants without table service. (Only Chuck E. Cheese’s scored lower.)

Whether it likes it or not and no matter how much chicken it sells, McDonald’s will always be known first and foremost for the hamburger. That doesn’t mean it has to compete with the better burger chains. It just needs to convince consumers that its burger has gotten better.

We want a ‘natural’ Big Mac. Why fast-food giants are finding it tough to deliver

November 4, 2015

2015-11-04_1641Peter Frost
Copyright © 2015 Crain Communication, Inc.

Chain restaurants that want to jump on the all-natural beef, chicken or pork bandwagon better expect to wait in line.

While higher-end restaurants in Chicago and other big cities have long turned to niche natural-meat suppliers, McDonald’s, Subway, Chick-fil-A and smaller companies are competing for a limited supply of “clean-label” meats. In many cases, they’re being forced to get supplies from the other side of the globe or wait years for suppliers to catch up to the types of proteins consumers want today.

“The infrastructure just doesn’t exist today,” says Marion Gross, senior vice president of supply chain management at McDonald’s, the nation’s largest fast-food chain. “And no one can turn on a dime, especially when you do the type of volume we do.”

On a quest to improve the quality of its food and lure back customers who left long ago for competitors perceived to have higher food quality, Oak Brook-based McDonald’s is overhauling a portion of its supply chain. It plans to begin using hogs raised outside of gestation crates, eggs from cage-free chickens and chicken not containing antibiotics used to treat humans. On Oct. 19, the company said it also will begin serving sustainable beef in some areas next year.

But the systemwide changes won’t begin to take effect in the United States until 2017, and they won’t be finished until 2025, because of McDonald’s huge size.

U.S. meat suppliers, knowing they’re missing an opportunity, are investing millions of dollars to change farming practices and acquire “natural” brands to fill growing demand. But change takes time.

The primary factor driving deals “is the pursuit of growth and moving into markets where the growth is,” says Heather Jones, a BB&T analyst based in Richmond, Va. “It’s completely being driven by the consumer, and these companies realize it is way cheaper to buy than it is to build this on your own.”

Big meat producers like Austin, Minn.-based Hormel Foods, which in May agreed to buy Applegate Farms for $775 million, and Salisbury, Md.-based Perdue Farms, which bought Natural Food Holdings and its Niman Ranch brand in September for an undisclosed price, are augmenting their portfolios with branded organic and natural products primarily to compete better at retail, where consumers make decisions based on the label.

The takeovers also should help big meat processors learn from the upstarts and apply the lessons throughout their mass-market-sized operations. Randy Day, president of Perdue Foods, the food division of Perdue Farms, says the acquisition of Chipotle’s pork supplier, Niman Ranch, will help his company continue “a slow, thoughtful” expansion into antibiotic-free pork without compromising what made Niman successful in the first place.

Hardees and sister burger chain Carl’s Jr. had to look outside the U.S. to Australia to find enough steroid-free, antibiotic-free, grass-fed beef to supply its 3,000 U.S. restaurants for an unexpected hit. Its “all-natural” quarter-pound burger performed so well in limited tests that the chains are keeping it on menus indefinitely. The sandwich, which retails for $1.50 more than a conventionally sourced burger, has been the company’s best-selling new beef product over the past two years, says Brad Haley, chief marketing officer for Carl’s Jr. and Hardees, subsidiaries of CKE Restaurants of Carpinteria, Calif.
“Earlier generations were more concerned about counting calories, and this generation is more concerned about counting chemicals,” Haley says. “And this is not a surprise to our suppliers. They’re getting asked by everybody for this, but we just couldn’t get enough in the U.S. to meet our volume demands.”


Roti Mediterranean Grill, a Chicago-based fast-casual chain with 21 restaurants, likewise tapped Australian and South American cattle for dishes that will showcase the grass-fed, pasture-raised beef its customers have come to expect, CEO Carl Segal says.

“People absolutely want it,” he says. “There’s such a tight supply in the U.S. right now. Until the big producers realize there’s more and more demand for (natural meat) we’re still going to (have) tight supply, which is going to keep pricing very high. It’s frustrating.”

Market share for organic or natural chicken, beef and pork remains small. Aside from antibiotic-free chicken, which is 6.5 percent of the total chicken market by pounds, no other natural or organic meat holds more than 3.6 percent of its category, according to data from Chicago-based market research firm IRI/FreshLook.

But while analysts say it’s unlikely the majority of consumers will pay hefty premiums for grass-fed beef or chickens raised without antibiotics—supermarket prices of such products sometimes are nearly double those of factory-farmed meat—sales are outpacing conventional products by as much as a factor of six, the IRI data show. And they might have increased even faster if more supplies were available, analysts say.

“It’s going to take time for the farming and (agriculture) community to produce as much organic and antibiotic-free product as demand dictates,” says Darren Tristano, executive vice president of Technomic, a Chicago-based market research firm.

And demand is growing. Subway wants to convert to chicken raised without antibiotics next year and eliminate antibiotics from all meat within 10 years. Chick-fil-A plans to sell only chicken that is entirely free of antibiotics within four years. Earlier this year, Wal-Mart Stores asked its meat and egg suppliers to curb their use of antibiotics and provide animals with more humane living conditions. Perhaps wisely, it didn’t set a deadline.

How 10 Food Trends for 2016 Will Transform Restaurants

November 2, 2015

2015 LLC™ All Rights Reserved

At this point a couple years ago, if you asked a restaurant executive how she might user Uber to build sales, she might have guessed as a prefix for the name of her brand’s Oktoberfest-theme burger. But now, Uber and Postmates are just two of the sharing-economy apps rapidly transforming foodservice and shaking up consumers’ expectations everywhere.
Going into 2016, there are dozens of similar forces shifting the ground beneath restaurants, and most of them are far beyond what brands have the power to control. While they are hard to predict, even for a data-rich firm like Technomic, they are easy to identify and understand, because they all spring from evolving consumer demand. Major moves from the biggest restaurant companies—McDonald’s moving its food supply toward more cage-free eggs, for example—aren’t dictated solely by the bottom line. They’re dictated by what consumers need from foodservice brands.

Technomic just released its 10 major food trends for 2016 with this dynamic in mind. Because consumers are the impetus behind all the upheaval, take a look at each trend and see how many of them you’re driving with your own dining out preferences.

The Sriracha Effect: This hot sauce from Thailand will continue to grow in popularity, but the “effect” Technomic predicts is that chefs and chain restaurant executives will search for the next hot ethnic flavor to find lightning in a bottle again. Early indications are that this will drive more use of and consumer interest in ghost pepper from India, sambal from Southeast Asia, gochujang from Korea, and harissa, sumac and dukka from North Africa.

The Delivery Revolution: Popular apps that simplify online and mobile ordering making “dining in” even easier and, in some cases, “dining out” irrelevant. Delivery services like GrubHub are starting to proliferate far beyond urban centers, bringing the convenience of a restaurant meal home, where plenty of people are likely camping out in front of the TV to binge-watch a season or two on Netflix. Other services are muscling in, including the aforementioned Uber and Amazon, which is expanding its Prime Fresh memberships for grocery delivery.

One particular threat to restaurants could be app-only services like Munchery, which delivers restaurant-quality food from a commissary, cutting out brick-and-mortar restaurants completely.

Negative on GMOs: In some cases, consumers have made up their minds before scientists have reached consensus, but many restaurant customers are declaring genetically modified organisms to be nonstarters. Many diners will agree with calls for labels of GMOs on menus and food packaging; some will go further and gravitate toward restaurants that advertise a GMO-free menu. That will be a major issue for the nation’s food supply, since many crops—particularly soy fed to livestock and other animal feeds—have been modified to boost their yields and productivity.

Modernizing the Supply Chain: Speaking of the supply chain, it already has enough challenges to deal with, including climate destabilization, rising costs for transportation and shipping, and pests. These will cause frequent repeats of shortages similar to those witnessed in 2015, like the unseasonable freeze that decimated Florida’s orange crop or the egg shortage that resulted from avian flu. Those hurdles will proliferate while more and more consumers demand food that is “fresh,” “local,” or just free of additives and artificial ingredients. Every brand, from restaurants to grocery stores and convenience stores, will make big investments in supply chain management in 2016.

Year of the Worker: Restaurants will also contend with rising labor costs, because of new mandates to cover full-time staff with health insurance and because the minimum wage could increase sharply depending on the state or city where they’re located. Pressure groups will ratchet up their call for a $15-per-hour wage, and they could possibly succeed in more cities like they have in New York and Seattle. Don’t expect any changes to the federal wage floor of $7.25 per hour, because no cooperation between a Democratic White House and a Republican Congress is possible, especially in an election year.
How will restaurants respond? Most will raise their wages to either comply with a new law or to compete for the best staff—but that means menu prices are going up as well, everywhere from fast food to fine dining. Also, more brands will experiment with technology and automation in the kitchens and the dining rooms to do more with fewer employees.

Fast Food Refresh: Consumers gravitate to “better” quick-service restaurants, which has transformed the industry. That has created a subset of “QSR-Plus” concepts with fresher menus and more contemporary designs, which exploits a price threshold between fast food and fast casual. Culver’s, Chick-fil-A and In-N-Out Burger are examples of this. “Build-your-own” menus are springing up across the industry, and many quick-service brands are adding amenities like alcohol.
QSR-Plus also helps other restaurants clarify their positioning by giving up their attempt to go upscale in a piecemeal approach, and those chains instead are returning to their roots with simplified menus and lower prices.

Elevating Peasant Fare: The popularity of street foods and consumers’ demand for portability and affordability have put things like meatballs, sausages and even breads back in the spotlight. But this time, those meatballs might have a nouveau twist, such as a blend of fancier meats like duck or lamb. Multiethnic dumplings will also continue to grow in popularity, from Eastern European pierogi to Asian bao.

Trash to Treasure: Rising prices for proteins will raise the profile of underused cuts of meat, organ meats or “trash fish.” The “use it all” mindset has also moved beyond the center of the plate. Some restaurants will use carrot pulp from the juicer to make a veggie burger patty, and perhaps other chains will follow the lead of Sweetgreen, which last year partnered with celebrity chef Dan Barber to make the wastED Salad, an entrée that saves vegetable scraps like broccoli stalks and cabbage cores and combines them with upscale ingredients like shaved Parmesan and pesto vinaigrette.

Let them eat kale stems!

Burned: Smoke and fire are showing up everywhere on the menu—smoky is the new spicy. Look for more charred- or roasted-vegetable sides, desserts with charred fruits or burnt-sugar toppings, or cocktails featuring smoked salt, smoked ice or smoky syrups.

Bubbly: Effervescence makes light work of the trendiest beverages. Technomic expects rapid sales growth of Champagnes and Proseccos, Campari-and-soda aperitifs, and adults-only “hard” soft drinks like ginger ales and root beers. In the nonalcoholic space, sales will also increase for fruit-based artisanal soda and sparkling teas.

Snacking and Healthier Options are on the Rise

October 30, 2015

pictureSnacking is a growing trend and consumers are snacking more frequently. About half of today’s consumers (51 percent) say they eat snacks at least twice a day and 31 percent say they’re snacking more frequently than they were two years ago.

According to Technomic, Americans also are broadening their definition of a snack to encompass a wider range of foods and beverages.

Smoothies are they a snack or a meal? According to Vitamix and ORC International, 59 percent is snack, 25 percent is part of a meal and 18 percent meal.

“Snacking occasions represent a growth channel for restaurant operators. The retail market is aggressively promoting snacks, but there’s plenty of room for restaurants to expand their snack programs and grab share. By providing more innovative, healthy and easily portable snacks, and boosting variety, restaurants can position themselves to increase incremental traffic and sales –particularly among a younger customer base.” Darren Tristano, executive vice president of Technomic.

In an article by WholeFoods Magazine called “Healthy Snacking on the Rise in the US” this article reports that more Americans are snacking more than ever before – but are also make smarter snacking choices. In a recent survey taken, 33% of the survey population is snacking on healthier foods than they were last year. This number has steadily risen with time, and is something that only stands to increase with nearly a third of all parents surveyed mentioning that they are serving healthier snacks to their children.

What a great opportunity for any restaurant, café, juice or smoothie bar to take advantage of this growing trend. Now more than ever it is important to offer customers what they want and that is healthier options.

The healthy trend is also dominating menus. Gone are the days of serving only indulgent foods or offering calorie laden menu items. The most prominent industry buzzword over that last decade is healthy which appears in various forms on today’s menus. This change has been inspired by the growing public awareness of healthy attributes in food and consumers are leaning on restaurants to go beyond adding a side salad to create a healthy meal.

Has America FINALLY hit ‘peak pumpkin’?

October 28, 2015

pumpkinKatie Little
© 2015 CNBC LLC. All Rights Reserved. A Division of NBCUniversal

More than a decade after Starbucks helped make “pumpkin spice latte” a household name, there is some evidence that “peak pumpkin” may finally be coming to restaurants.

The country’s 500 biggest restaurants launched just 45 pumpkin flavored limited-time offerings, such as Dairy Queen’s Pumpkin Pie Blizzard Cake or Krispy Kreme’s Pumpkin Spice Doughnut, from January to September. That’s down 61 percent from 116 a year ago, according to data from Technomic.

“Although many consumers are still interested in pumpkin spice, recent years have shown heavy saturation with beverages and although the flavor is likely here to stay, the growth of the trend is starting to flatten showing we have reached maturity,” wrote Darren Tristano, executive vice president at Technomic, in an email.

Overall promotions are shrinking as well, falling 11 percent as operators adopt a “less is more” attitude borrowed from fast-casual restaurant hits like Shake Shack and Chipotle.

“Brands are starting to discover the fact that consumers are experiencing new menu burnout,” Tristano wrote. “This year marked the first year in a decade that top chain restaurant menus declined in total menu offering.”

At the retail level, growth is also showing signs of slowing.

For the year ending July 26, sales of pumpkin-flavored items rose 11.6 percent, the slowest growth in at least three years, according to Nielsen data. Declines in pumpkin-flavored coffee, milk and frozen waffles, pancakes and French toast were especially steep. Still, pumpkin-flavored item sales remain a large market, clocking in at $360 million at retail outlets, including grocery and convenience stores.

So if pumpkin has reached saturation, which seasonal item will start to take share? This is difficult to predict, Tristano says, adding it’s possible other seasonal flavors like gingerbread, molasses, peppermint or eggnog could increase.

5 Things to Know About McDonald’s All-Day Breakfast

October 26, 2015

2015-10-26_0912Brad Tuttle

The world changed at 10:30 a.m. on Tuesday.

McDonald’s Launches All-Day BreakfastThese Are the Best and Worst McDonald’s Breakfast FoodsThe Unlikely Origin Story of the Egg McMuffin

For many years, McDonald’s said that it was pretty much impossible to serve all-day breakfast. The thinking was that the restaurants were too busy, and the kitchens were too small, to handle breakfast orders on top of burgers and the rest of the menu.

But after receiving tens of thousands of demands for all-day breakfast on social media—and after finding itself in a fairly desperate situation in which sales have declined substantially—McDonald’s has capitulated, and the era of all-day breakfast kicks off on Tuesday, October 6. That means that around the nation, McDonald’s customers can order breakfast items past the usual cut-off time of 10:30 a.m. So today, you can expect plenty of fast food enthusiasts to be enjoying McDonald’s breakfast for lunch, brunch, dinner, a mid-afternoon snack, and anything and everything in between.

Here are a handful of things to take note of concerning the arrival of McDonald’s all-day breakfast.

Only part of the breakfast menu is available all day. Because of the complications of adding breakfast to the menu alongside the rest of the usual afternoon options, McDonald’s is limiting the kinds of breakfast items available for the entire day. All-day menu options vary by location, though most will have a core selection of things like hot cakes, fruit and yogurt parfait, oatmeal, sausage burrito, and hash browns.

No Egg McMuffins in the South. The biggest “controversy” over McDonald’s all-day breakfast is that there is a sharp division of North and South. “Maybe the Mason-Dixon line should be renamed the Biscuit-McMuffin line,” industry publication Nation’s Restaurant News deadpanned. It was decided that Southern tastes prefer biscuits over McMuffins, and because it was too difficult for McDonald’s restaurants to serve both all day, locations had to go one way or the other. McMuffins rule most of the country, while the Southeast’s “Biscuit Belt” stretches through Appalachia, and from Louisiana east through to Georgia. Florida, however, has been declared McMuffin territory, presumably because the state is so full of transplants from other parts of the country.

The move is an unusual popular crowd pleaser for McDonald’s. The world’s biggest fast food burger joint has become a magnet for haters over the years, with McDonald’s serving as a high-profile punching bag for anyone who has a beef with obesity, poverty, nutrition, environmental issues, and beyond. So the fact that the switch to all-day breakfast is generating McDonald’s praise by the masses is a very big deal. “This is the consumers’ idea. This is what they want us to do,” McDonald’s president Michael Andres told the Wall Street Journal last month. “That’s why I think this could be the catalyst for our turnaround.”

AdAge noted that McDonald’s new ad campaign highlights the idea that all-day breakfast was driven by customer demands, with people reading random Tweets sent out about the big change: Some McDonald’s are offering freebies to celebrate. While there is no national promotion heralding the era of all-day breakfast, McDonald’s in various parts of the country are hosting specials. On Monday, for instance, a McDonald’s-Uber partnership was offering free delivery of McDonald’s food to customers in the greater Miami area. On Wednesday, Colorado McDonald’s are hosting a special “PJ Day,” in which customers who wear pajamas into restaurants will be rewarded with a free Egg McMuffin; “5 a.m. to midnight offer, shirts and shoes required,” the promotion stipulates.

While popular, all-day breakfast could backfire. McDonald’s is somewhat in danger of cannibalizing sales with all-day breakfast—and because breakfast items are generally cheaper than burgers and sandwiches, profits could remain flat, or even decrease. “The lower check average [of breakfast items] doesn’t drive the margin as much as higher-priced items like premium burgers,” Darren Tristano, an executive vice president at Technomic, explained to CBS News.


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