For decades, McDonald's was the most popular fast food chain in America, a place where families and children could enjoy a meal at affordable prices.
Now, the soaring cost of several menu items is making the company lose millions of customers and billions in sales every year, resulting in worrying cash flow problems that are accelerating its collapse in the very industry it helped to create.
Although executives said that higher menu prices are helping the company to boost earnings and revenue, analysts argue this is also shrinking the chain's customer base, which will ultimately hurt its bottom line.
Even though same-store sales have risen over the past decade, higher average checks drove these numbers, not customer visits.
During a call with investors, the CFO highlighted that McDonald's cannot survive with declining customer counts.
Considering its enormous operations worldwide and the conditions that led the company to become a huge success, it is very odd to see that instead of investing in keeping and growing its base of customers who can afford to regularly frequent its restaurants, the brand is focusing on gaining a public that already has hundreds of options of higher priced burger chains out there.
Businesses have to adapt constantly and value the customers that they already have.
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