Despite Slowdown, Best Is Yet to Come: McDonald’s CEO
Jim Skinner, McDonald's outgoing CEO, said that the best is yet to come, despite a slowdown in the U.S. and Europe.
“I think all CEOs have one obligation,” he told CNBC’s “Squawk on the Street.”“That’s to grow the business and to sustain the growth of the enterprise for all the stakeholders, and, most importantly, to provide leadership for the future.”
Among his successes, Skinner highlighted an evolution of the menu that has added beverages and healthier items, as well as improving access to the restaurants and modernizing the dining experience.
Beverages and their attractive margins have also been key to success at drive-in chain Sonic Corp. On "Squawk Box," J. Clifford Hudson, Sonic CEO, said "There’s far more profit in drinks than in food, and far more profit in ice cream than food.” Drinks and ice cream make up 40 percent of Sonic's sales.
Focusing exclusively on the McDonald’s brand and jettisoning other “distractions” was instrumental in improving same-store sales growth, as well, Skinner said.
“Right from the beginning of the revitalization, when we focused on “Brand McDonald’s,” same-store sales growth in that first year of 2003 was significant,” he said. “We were on track then from 2004 through 2012 to grow same-store sales.”
Europe and slowing global economic growth are still concerns and U.S. compshaven’t bottomed yet for the year.
“We’re very concerned about austerity around Europe, particularly in Southern Europe,” Skinner said. “U.K. and Russia continue to do well, which is a signal to us that if we have the right strategies and marketing plans, and have everyday affordability, we’ll continue to do well.”
When things turnaround, Skinner expects McDonald’s to be in the best position of any fast-food chain to continue to grow. “We’re taking market share basically everywhere, so we’re doing better than the rest and I expect we’ll continue to do so,” he said.
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