Beef Bits

Cattle Market & Farm Reports, Editorials
Mar 14, 2005
by WLJ

McDonald's reports sales increase
McDonald's Corporation last week announced a 4.4 percent increase in February for global systemwide sales, compared with February 2004. Comparable sales for McDonald's restaurants worldwide increased 1.6 percent, marking the 22nd consecutive month McDonald's has reported an increase in global comparable sales. McDonald's CEO Jim Skinner said, "The ongoing strength of the strategic U.S. menu, marketing and service initiatives, as well as strong consumer response to our nationally advertised Chicken Selects sampling event, contributed to the monthly performance.”

Wendy's reports weak February
Wendy's International Inc. said its same-store sales last month were down 2.4 percent, compared to February of 2004. Last year same-store sales increased 9.9 percent for April. Wendy's franchises fared better, slipping only .7 percent to .9 percent, compared to last year's eight percent increase. The company's Tim Hortons restaurants posted a 6.2 percent increase in Canada to 6.6 percent, and an 8.1 percent increase to 8.5 percent in the U.S. Company CEO Jack Schuessler said Wendy's poor results were because of winter storms, particularly in the eastern half of the country.

Fast-food burger traffic up
Quick-service hamburger outlets served more than 500 million more customers last year than the previous year, a four percent increase in overall foot traffic, according to industry research group The NPD Group. By comparison, coffee restaurants served in excess of 200 million more customers in 2004, while donut shops served about 150 million more people than the previous year. Traffic at all restaurants in 2004 grew by two percent, the first solid growth since 2001, NPD said. By category, NPD said quick-service and casual-dining operators each grew by two percent, while mid-scale restaurants dropped one percent in traffic.

Drought forces Aussie cattle sale
About 11,000 head of cattle were auctioned off in the Australian city of Roma as the continuing dry conditions force graziers to sell-off stock Livestock agent Jason Carswell said cattle were trucked in from western Queensland, South Australia and the Northern Territory. "The panic has sort of set in some places where it's drier than most and we're seeing that now with large numbers coming through that people have sort of waited for the rain and it's just getting to the stage to do something before it does get proper dry," he said.

Chain restaurant sales growing
The chain-restaurant industry has enjoyed more than a year and a half of sales growth, according to market research firm The NPD Group. Based on data collected from more than 40,000 units, for the week ending Feb. 21, same-store sales rose 4.6 percent from the year earlier period. The average increase in same-store sales for the 86 weeks was 4.4 percent. Chains also continue to erode the market share of independents. According to NPD, major chain restaurants captured an additional three percent of the market between 2001 and 2004.

Texas targets genome project
The Texas Beef Council board of directors, representing the state’s beef producers, approved funding of $100,000 in Texas checkoff funds for the international bovine genome project. This funding represents the second of up to three annual installments of $100,000 each that TBC has committed to this $53 million research. Other U.S. contributors include the national beef checkoff program, the state of Texas, the National Institutes of Health and USDA.

Meat cutters may be replaced
Tops Markets LLC and the union representing local meat cutters met in Cleveland, OH, last week to discuss the chain's plan to stock 49 Northeast Ohio stores with prepackaged meat, which would effectively eliminate the need for retail meat cutters. The company has already lined up a vendor to handle the meat packaging. Tops is going against the trend of other grocery chains to provide more and better service in its meat departments in order to compete with nonunion Wal-Mart Stores Inc. After meat cutters at a Texas Wal-Mart voted to join a union in 2000, Wal-Mart eliminated butchers in its grocery departments and switched to prepackaged meat.

McDonald's launches fitness ads
McDonald's Corp. is now encouraging customers to get fit with a new advertising campaign. The promotion leads with the slogan, "It's what I eat and what I do … I'm lovin' it," and features athletes, including Venus and Serena Williams. The campaign will use animation to show McDonald's drink cups, lettuce, straws and burgers performing exercises. One commercial even suggests, "Maybe you should spend less time with your TV.” The effort includes new packaging, an updated Web site and a series of videos featuring Ronald McDonald—the new fitness mascot—teaching children how to eat well and stay active.

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