It has been a rough year for McDonald’s, which of course has resulted in plenty of Schadenfreude from its critics.
The fast food giant keeps losing market share to fast-casual restaurants such as Chipotle and Panera Bread, and other competitors find a way to thrive while its new marketing campaigns fall flat with customers. Despite a modest uptick in business in its largest markets, Europe and the U.S., last month’s sales dropped overall due to a plunge in revenues within the Middle East, Asia and Africa.
In a world where more people are concerned about their food choices, the company is trying to change. McDonald’s has listened somewhat to consumers’ demands for more healthful and sustainable menu choices. The company now serves 100 percent sustainable fish, and a year ago said it would start sourcing sustainable beef in 2016.
So, how is that working out for McDonald’s?
The short answer is . . . it’s well, . . . going. Slowly. As would be the case with any massive shift in business practices, transforming McDonald’s supply chain is going to take some time. But will this change come soon enough at a time during which customers under the age of 35 are abandoning the company while the company struggles to reinvent itself, digs in its heels, then changes course again?
In fairness to the company, the company’s success, and future survival, depends on the ranchers who supply the company’s most iconic product: beef. While multinationals such as Cargill and Brazil’s JBS control a huge part of the global meat industry, ranching is still at the heart of this sector. And to many of those vested in raising cattle, it is not only a business, but way of life -- one that has not changed too much over generations. Furthermore, many ranchers operate on thin margins — a shift towards a more sustainable operation can only succeed if it allows those at the furthest reaches of the supply chain plenty of time to make these changes, so they do not go bankrupt in the name of making McDonald’s look better.
To that end, last year McDonald’s chose Canada to be the first country in which the company operates to serve only sustainable beef. Much of the work will involve setting up guidelines on everything from animal welfare to environmental stewardship and the development of steps to improve transparency. Arguably, McDonald’s work in Canada is also a pilot program for the recently announced Global Roundtable for Sustainable Beef (GRSB), a tiny step the beef industry has taken to become more accountable and responsible.
This step-by-step approach will be too slow for McDonald’s adversaries, who will also be chagrined to find, as detailed by Joel Makower in Green Biz, that your Big Mac or Quarter Pounder is hardly going to taste like beef raised in Argentina’s pampas: McDonald’s plan is to slowly increase the percentage of “sustainable beef” (as defined by McDonald’s) starting next year, and the company may set a percentage goal for the company 2020.
If McDonald’s can somehow succeed in sourcing beef that is less cruel and more environmentally responsible, it could cause a ricochet effect throughout the global meat industry. Rather annoyingly, McDonald’s tries to put an altruistic spin on why they are doing this, saying it is moving ahead even though its purchases only comprise 2 percent of the world’s total beef and dairy industry. But in the grand scheme of things, that is still an impressive amount for a single company — one that insists on serving pallid hamburgers when diners, foodies and those just looking for a cheap meal are constantly searching for something different.
Even if McDonald’s did not care about animal husbandry practices or greenhouse gas emissions, the company still must confront a huge challenge: Its hamburgers just do not taste good to today’s diner, while new chains from Umami Burger in Los Angeles to Five Guys, Shake Shack and The Habit are cleaning up with a more pleasant dining atmosphere — and better food. It is true that transforming a supply chain takes time. But for McDonald’s shareholders, these shifts have come too late — the company should have seen what was going on in the marketplace and initiated these changes many yesterdays ago.
Image credit: Robivy64
Based in California, Leon Kaye has also been featured in The Guardian, Clean Technica, Sustainable Brands, Earth911, Inhabitat, Architect Magazine and Wired.com. He shares his thoughts on his own site, GreenGoPost.com. Follow him on Twitter and Instagram.
Leon Kaye has written for TriplePundit since 2010, and became its Executive Editor in 2018. He's based in Fresno, CA, from where he happily explores California’s stellar Central Coast and the national parks in the Sierra Nevadas. He's lived in South Korea, the United Arab Emirates and Uruguay, and has traveled to over 70 countries. He's an alum of the University of Maryland, Baltimore County and the University of Southern California.