The most important food of the day is also the most left out of the day, at least according to the two biggest fast-food chains in the country.
The last week of McDonald’s and Wendy, during his earning calls, he said that he was watching the sale of dull breakfast. Companies blamed the economic uncertainty and trend to increase the pressures facing low -income consumers.
“There is a lot of concern and restlessness with that low -income consumer,” McDonald’s CEO Christopher Campsinsky said on 6 August.
Despite the wage benefits, the actual income for low -income consumers is below, which are facing much more financial stress, the CEO said, citing President Trump’s tariff As a potential contributor.
“So the actual income is down with low income consumer, that is going to put pressure on the journey exactly [quick-service retail] Industry. The second thing is that there is a lot of concern and restlessness with that low -income consumer. I think we can all estimate the causes of this, perhaps tariffs and effects, which may be, may be a question about the employment situation, “Campsinski said.
According to Kempczinski, traffic from low-income consumers is a main demographic-one industry tendency for a decline-fast-food restaurant, with a breakfast menu in the quick service industry with a breakfast menu.
Why leave breakfast?
As many Americans Reinforcement of discretionary expenses, Industry analysts and officials say that one of the first items on the chopping block is breakfast. Instead of going to drive-through for a breakfast sandwich, more American are choosing to grab something at home, or leave food completely.
Wendy’s interim CEO Kane Cook said on the company’s earnings call 8 August 8, “When consumers increase uncertainty and choose another meal at home, breakfast is often the first place that they do,” Wendy’s interim CEO Ken Cook said the company’s earnings call on 8 August.
This is contrary to breakfast boom Expand their morning offerStarbucks, which launched egg bits in 2017, now has a breakfast menu with 12 different objects. Wendy Restart Provides 10 items with breakfast and eggs in 2020.
Fast food cost The sky is touched over the past decade, According 2024 report by Financebuzzz. The individual finance site found that the McDonald’s quarter pounder with cheese food from McDonald’s increased by $ 5.39 in 2014, which increased to $ 11.99 in 2014 in 2014.
To ensure this, the report of slowing the traffic in fast-food chains before the recent decline in breakfast sales. On an earning call in May 2024, McDonald’s CEO Campsinsky expressed “increased concern” how the economy was weighing on lower and medium -income Americans. During the same timeCEO of dine brands, who owns Applebee and IHOP, told CNBC’s casual restaurants were also seeing a decline in low -income customers.
Nevertheless, not all fast-food chains are experiencing a decline in breakfast traffic. Both Starbucks and Dunkin told CBS Manivatch that they had seen success with breakfast sale.
Both McDonald’s and Wendy arrived for CBS Manivach’s comment, indicating their earnings reports.
What does breakfast sale say about the economy
Experts say that the decision to leave at breakfast of American consumers at breakfast and numerous economic pressures facing moderate income consumers from sky-high credit cards to inflation to inflation.
Matthew Tod, a director of S&P Global Rating, told CBS Manivatch, “The fact that breakfast is slowing down now, in our opinion, speaks to increase economic uncertainty and less consumer beliefs that we have seen, and actually moved forward as tariff rhetoric,” S&P Global Rating a director Mathew Tod.
Todd said, “The consumer focuses at a very high price, wise and selective how they are spending.
Mark Zandi, the chief economist of Moody’s Analytics, told CBS Manivatch that lower and medium-or-II Americans are spending more carefully than the end of the previous year, a “weak” labor market in part. He said, “This year is adding their nervousness and their caution.”
Most recent Report of jobs Hiring was shown slow in July. The Labor Department also rapidly modified the development of the job by a joint 258,000 for May and June, a sign that was weak than the pre -approximate. With the amendment, the US added 19,000 jobs in May and 14,000 jobs in June.
Experts also told CBS Manivatch that the purchasing power of low-income consumers is already under pressure due to inflation-he said that he said Can increase tariffsIn July, the Consumer Price Index showed inflation on an annual basis at 2.7%. Restaurant prices are 3.9% from last year’s July and 0.3% from June.
“If they have to spend more to buy a pair of shoes or cut their hair more, they are going to be reduced to spend everything again, including breakfast in a fast-food restaurant,” Zandi said.
