In these tough economic times everybody is decreasing on everything. Dining out is one among the first areas to go. I should apprehend, I am reducing myself.
I used to be trying at my budget last month, and all I can say is the money flowed freely. Freely from my pocket into the numerous stores and restaurants I frequent. When my girlfriend Linda and I started adding up our expenses, the amount was staggering. I couldn't believe how much cash we have a tendency to spent on entertainment, eating out, groceries, and food.
It seems we have a tendency to were single-handedly supporting the restaurant industry.
I noticed right away, a vital cost was eating out. Despite accounting for less than a third of our meals, the price was a lot of than 0.5 the budget. Like many Americans, we've created a conscious decision to chop back on our expenses. We will reallocate some of the dining out greenbacks to alternative budget items.
The important challenge can be how 2 "foodies" like us are going to deal with the change.
Now, I've got it from a reliable source we tend to're not alone. In line with the Wall Street Journal, 2009 is meant to be another down year for the restaurant industry.
An interesting trend is beginning to develop.
Several individuals are not simply restricting on how often they eat out. Many are also downsizing what they will pay for a meal. Simply take a look at the "quick casual" restaurant. Restaurants like P.F Chang's, TGI Friday's, Chili's, were all massive successes just a few years back. Now they are obtaining hammered by the economic downturn.
Folks are changing their eating habits.
And I don't mean shifting to a high protein diet. People are trying for deals when they eat out... and they are finding them at quick food chains.
There are deals aplenty to be had at the traditional quick food places like McDonald's, Burger King, and Wendy's. The quick food corporations are taking part in into the hands of those consumers. Several are introducing price oriented dining.
For instance, McDonald's encompasses a price menu (I'm positive you've seen it). These are all things that may be had for a buck. It's arduous to argue when you'll be able to feed yourself an entire meal for less than $4.
You cannot get an appetizer at a quick casual restaurant for that price.
Let's look a little additional closely at McDonald's (MCD). Monday the corporate announced fourth quarter results. In one of the toughest economic environments they reported some great numbers. Same store sales (a massive focus in the restaurant trade) are up additional than 7%. All told the corporate serves some fifty eight million customers a day. Wonderful to think about.
However that is not all.
While different chains are closing (assume Bennigan's) McDonald's is growing. This year the corporate can pay $2.one billion building new locations and reworking existing stores.
The company still manages to post solid earnings numbers with additional than $980 million visiting the bottom line. It's down a bit from 2007, but not dramatically.
Management's even being sensible about buying back shares and managing the dividend. McDonald's success shows within the stock price. They were one in every of solely 2 firms to finish 2008 in positive territory.
Not bad, especially once you compare that to say... the financial business!
I think because the recession drags on McDonald's will still outperform. Consumers are going to trade down in each approach they can. For my cash you can't beat a Massive Mac, and you cannot beat an investment in McDonald's stock. Take a look for yourself. You may gobble some up for your own portfolio.
Author Resource:
Jeff Patterson has been writing articles online for nearly 2 years now. Not only does this author specialize in Restaurant Industry, you can also check out his latest website about
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