McDonalds, Burger King, Wendy’s, KFC, Carl’s Jr., and Taco Bell. These are a few of the names that pop into a person's head when fast food is mentioned.
Despite their status as mega corporations, many of these chains are losing ground to their biggest rivals, small local startups offering healthier and higher quality foods. To counter this they have made desperate changes to maintain their current following.
Take McDonald’s for example, in commercials they use photo editing to make their burgers more appealing. Ronald McDonald, originally marketed towards young children, is now been portrayed as a hip cool clown for the adolescent crowd.
Startups have never had to make these drastic changes in the presentation of their product, they already have the taste, look, and texture established after a few visits from the customers.
Looking at the small businesses that are popular in the Belmont-San Carlos area, many do what the fast food giants seek to accomplish, a more chic menu with healthier foods with fresher ingredients.
For example, McDonald’s new Gilroy garlic fries, the only reason Gilroy is listed is perhaps to emulate what Five Guys does, saying where their potatoes come from in order to give an idea of freshness or locally sourcing ingredients.
Fare PDQ on El Camino is a reflection of what fast food restaurants are trying to be: using locally sourced ingredients, and fresh hand made sliders (instead of reheated).
Steven Spitts, the owner of Fare worked for a money management firm for some large fast-food chains.
“At the firm I worked at we noticed that the stock value and income of many fast food restaurants were falling. While the better burger industry [such as In-N-Out, Five Guys, and the Counter] were gaining more customers, more income, and more recognition. Quality and freshness are what people want.”
Because many people enjoy fresh ingredients, many fast food restaurants are shifting towards higher quality ingredients. According to their website, McDonald’s is taking steps to remove high fructose corn syrup and preservatives from their meals.
Mike Andres the president of McDonald’s USA, said, “More than ever, people care about their food – where it comes from, what goes into it and how it’s prepared.”
Ironically, one contributing factor to fast food mega-chains losing revenue is the attempt appease the growing desire for fresh and healthier meals, but higher quality ingredients means higher prices for customers to pay.
Carlmont sophomore Andrew Joo had this to say about fast food chains’ drastic changes. “I used to go to McDonald’s, Burger King, Wendy’s, and other fast food [chains], but I slowly grew out of it. The french fries tasted soggy and reheated several times. The burgers really had no substance or a lot of flavors. And then they updated their menus which made all the prices almost double. That didn’t make a lot of sense, fast food chains are supposed to be cheap and a quick meal, but changing that gets rid of loyal customers that they rely on for business.”
According to the NASDAQ stock exchange website, Wendy’s has lost profit from its stocks, over $634, 945. McDonald's itself went through a similar rework of its menu and ingredients, and it lost over $2,000,000 in revenue.
This happened to Coca Cola in the 1980s when they introduced a new formula to compete with diet soft drinks. However, loyal customers were against changing the formula even though the taste would hardly change if at all. The feedback was so negative that to save their own company the had to resort back to the classic formula.
Falafel, another startup sells vegetarian street food also noticed how the fast food industry is changing, perhaps too late.
“I think it’s surprising when you go to other [restaurants] and you don’t have the crunch from the vegetables, and tastes like it was prepared much earlier and reheated. And customers enjoy the [crunch] of salads. We put a lot of effort making sure what we make tastes fresh, healthy, and clean. This is because more and more people are wanting to be healthier and more energetic. I think that the fast food industry is changing, because of all the documentaries attacking the industry. And people are eating fast food less, because they know more of what is inside of it.”
Steven Spitts said “People like higher quality foods and freshness in their foods.” This is a large reason that people are gravitating toward local startups rather than large fast food chains.
Despite company mottos and slogans of “I’m lovin it” or “Now that’s better”, many customers are realizing that they just don’t love what the fast food chains are serving and doing. Which has begun the rise of startup restaurants, and the slow downfall of the fast food mega-chains.
