Americans are revolting against McDonald’s and other fast-food establishments. This is harming French fry suppliers like Lamb Weston.

Lamb Weston, North America’s largest manufacturer of french fries and a significant supplier to fast-food chains, restaurants, and grocery stores, is closing a production facility in Washington state. Last week, the company stated that it would lay off almost 400 employees, or 4% of its workforce, and temporarily shut down manufacturing lines in response to falling customer demand.

Lamb Weston (LW) shares have plummeted 35% this year.

America’s French Fry King Sounds An Alarm

The potato giant is oversupplied at a time when demand is low. In recent years, restaurant prices have risen faster than grocery store prices, prompting shoppers to avoid fast-food establishments.

This move has had an impact on Lamb Weston because individuals are less inclined to prepare French fries at home. According to Lamb Weston, fast-food restaurants account for around 80% of all french fries consumed in the United States.

Fast-food restaurants, such as McDonald’s, are offering bargain menus to entice customers back. McDonald’s has introduced a $5 meal that contains a McDouble cheeseburger or a McChicken sandwich, small french fries, four chicken nuggets, and a small soft drink. However, these promotions are not benefiting Lamb Weston because customers are purchasing fewer portions of fries.

“Many of these promotional meal deals have consumers trading down from a medium fry to a small fry,” Lamb Weston CEO Thomas Werner stated during an earnings call last week.

Lamb Weston did not immediately reply to CNN’s request for comment.

McDonald’s, Lamb Weston’s largest customer, accounts for 13% of revenue. As McDonald’s goes, so does Lamb Weston.

America’s French Fry King Sounds An Alarm

And McDonald’s is struggling. Sales at US restaurants open at least a year declined 0.7% last quarter compared to the same period a year ago, dragged down by fewer consumers visiting the brand.

Lamb Weston is also heavily exposed to other fast-food companies, according to analyst R.J. Hottovy of analytics firm Placer.ai, in a research note to clients last week.

Customer traffic to fast-food restaurants fell 2% last quarter and 3% the prior quarter compared to the same period last year, according to Lamb Weston.

SOURCE | CNN

YouTube’s top stars have launched their competitor to Lunchables.

MrBeast, Logan Paul, and KSI are collaborating on a “groundbreaking new better-for-you lunch option” called Lunchly, combining all their goods into a single meal geared at their younger fans.

The all-in-one meal includes a bottle of Prime Hydration, a sports drink alternative founded by Paul and KSI that has grown in popularity; a Feastables milk chocolate bar created by MrBeast, a popular YouTube star with over 300 million subscribers; and one of three processed food options, including pizza, nachos, or turkey aand cheese with crackers.

Logan Paul And MrBeast Have A Lunchables Competitor That They Say Is Healthy

“Our ultimate goal has always been to offer not only high-quality products, but also healthier alternatives,” Lunchly cofounder Logan Paul stated in a press release. He also stated that the school lunch industry has been “dominated by Lunchables” since he was a child, and that it is “time to provide a better option for those looking for a convenient, healthier choice.”

Lunchly promises to be “healthier” since Prime contains more electrolytes than a Capri Sun in Lunchables, and Mr. Beast’s chocolate bar contains less sugar than a Kit Kat or Crunch bar.

Lunchly’s launch comes after Lunchable, owned by Kraft Heinz, announced a huge initiative last year to participate in school lunch programs. However, the company had to reformulate the components first to guarantee that the items met regulatory rules, which included incorporating fresh fruit into their meals.

Consumer Reports reported in 2024 that it recently studied the nutritional profiles of two Lunchables kits supplied in schools and discovered that they contain significantly more sodium than the Lunchables kits available in stores.

Logan Paul And MrBeast Have A Lunchables Competitor That They Say Is Healthy

Of course, KSI, Paul, and MrBeast know how to create brands, thanks partly to their devoted following. Despite government worries about the caffeine content of some of its drinks, Prime sales have risen, threatening industry leaders such as Gatorade and BodyArmor.

“Prime brings a youthful buying cohort that hasn’t had a lot pitched their way beyond traditional kids’ drinks,” Jeffrey Klineman, editor-in-chief of BevNet, previously told CNN. “Paul is significantly more intriguing to a 13-year-old than a juice box.”

SOURCE | CNN

McDonald’s has become known for its broken ice cream machines; there is even an independent website that tracks broken McFlurry machines. So Wendy’s is taking advantage.

Wendy’s is offering small-sized, $1 Frosty frozen dairy treats until September 30 — and it’s cooperating with McBroken, which tracks which McDonald’s stores have broken ice cream equipment.

The temporary price decrease may also draw value-seeking customers who are eating out less frequently and spending less when they do, slowing fast food sales and reducing restaurant visitation.

Wendy’s Takes Aim At McDonald’s Broken McFlurry Machines With A $1 Frosty

Wendy’s Frosty “has been the go-to sweet treat fix when fans’ cravings strike, while the ice cream machines at the other guys are offline — often for two to three hours at a time,” the chain claimed in a release, without mentioning McDonald’s directly.

McBroken’s data shows that about 15% of McDonald’s ice cream machines are broken as of Thursday. The most common time they are inaccessible is between 11 a.m. and 3 p.m., with Chicago, Houston, Las Vegas, New York, and Los Angeles among the most affected cities.

Wendy’s put the locations of its restaurants, as represented by its logo, to the McBroken map to show fans where to get a “reliable and delicious option.” There is also an ad at the top of the website promoting the $1 Frosty Special.

Rashiq Zahid founded McBroken a few years ago, after becoming dissatisfied with McDonald’s lack of operating ice cream machines. He previously told CNN that it works by combining data from the McDonald’s iOS and Android apps.

If the ice cream machine is not operational, the McDonald’s app will remove the ice cream order from the cart, he explained. When this occurs, a red dot shows on the mcbroken.com map, signifying unavailability in that area.

Wendy’s Takes Aim At McDonald’s Broken McFlurry Machines With A $1 Frosty

In response, McDonald’s previously told CNN, “it is exciting to see customer passion translate into customer-innovated solutions to further make that experience a reality.”

The cold dessert rivalry between Wendy’s and McDonald’s has heated up in recent years. Wendy’s has started adding limited-time flavors, like as pumpkin spice and peppermint, to increase the appeal of the Frosty. McDonald’s frequently pushes new flavours for its McFlurry, but recently added a smaller variant as customers continue to look for bargain.

SOURCE | AP