As per reports McDonald's Corp. MCD is adding McGriddle, a breakfast sandwich to its all-day breakfast menu at 1000 locations. It was tested in the state of Oklahoma, where the feasibility of serving all day breakfast was checked. The new item will be first offered at some McDonald’s restaurants in the southern states.
Some select stores in the states of Alabama, Georgia, Louisiana, Mississippi and South Carolina are adding McGriddle to the menu next week. McDonald’s launched its‘ All Day Breakfast’ plan on Oct 6, 2015.
The move came in response to customers’ demand on social media for breakfast items beyond the typical morning hours. McDonald’s breakfast accounts for approximately 25% of its total sales. As more Americans eat breakfast away from home, the battle for the breakfast day part has intensified.
A number of fast food restaurants have launched breakfast day parts over the past few years while others are busy adding new items. Toasts and cereals do not rule the breakfast platter anymore as burgers have slowly made their presence felt in this category. Lately, sandwiches have become popular apart from coffee. The breakfast sandwich is not only nutritious and filling because of ingredients like bread, eggs, cheese and meat whether bacon or sausage, but also convenient to eat while on the move.
For restaurant operators, breakfast generally has lower food cost requirements. Therefore, focusing on this day-part somewhat offsets the adverse impact of rising food costs, thereby boosting margins.
Last year, Yum! Brands, Inc. YUM also launched a breakfast category in its Taco Bell stores.
The list of fast-food chains looking to make the most of breakfast options includes Dunkin' Brands Group, Inc. DNKN, Jack in the Box Inc. JACK and Starbucks Corporation.
Separately, per reports, McDonald's will start enabling mobile ordering in some geographies outside the domestic market this year. Simultaneously, McDonald's is working on its first-ever national loyalty initiative, chalking out the technological infrastructure and e-mail database (through app downloads).This is required to support a successful rewards program. This digital transformation is also likely to add to its customer base and increase sales for the company.
McDonald's currently has a Zacks Rank #3(Hold).
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