McDonald’s is pivoting in a radical way to try to appeal to more late-night diners and increase revenues in Summer. The franchise is changing the operating hours of their locations, making them stay up to or past midnight. This new model could help McDonald’s stay competitive with other late-night franchises.
Some locations won’t be included in this change, such as mall and airport locations, which should keep to regular hours. McDonald’s operating for longer hours in the summer could draw in consumers looking for a late-night meal working night shifts or those coming back from events.
An Uptick In Hiring
In order to accommodate for longer operation hours, McDonald’s is hiring nearly 400,000 new employees this summer to avoid understaffing their locations. This means that current staff won’t be overworked as sales expect to increase dramatically across all locations that stay open late into the night and early morning.
This hiring also ensures that consumers can expect quality service and reduces the chances of employee burnout. The focus of the hiring is frontline crew, managers, and support staff to ensure that the operational capacity of the restaurants can keep up with consumer demand.
Menu Availability
McDonald’s should continue to sell their most popular menu items during these extended hours, especially new promotional items like McCrispy Chicken Strips. Although each individual chain has the autonomy to change what menu items they offer during these extended hours. This could lead to a difference in item availability depending on the region and what’s popular.
Breakfast items have not been confirmed to be offered during late night hours, which consumers might want to see. Either way, the extended operational hours should see a large increase in customer traffic throughout the country and could incentivize McDonald’s to rethink their business hours beyond the Summer season.
Sales Declines
Part of extending its operational hours is due to declining sales, which is the worst the franchise has seen since the pandemic. This decline could be due to inflation and changing consumer preferences. As economic uncertainties arise, consumers are changing the way that they spend their money, usually spending less on fast food and prioritizing it towards everyday essentials.
McDonald’s hopes to draw in different kinds of consumers by offering these extended hours. Social crowds, shift workers, and students are expected to be among the late-night diners.
Reaching A New Market
Many popular fast food chains in America already stay up 24 hours a day. McDonald’s is trying to reach a new market and better compete with franchises like Jack in the Box, Waffle House, and Whataburger, which have offered consumers late-night options for many years.
In the past, many customers who preferred McDonald’s would have to seek alternatives past their business hours. This shift could draw back some of the loyal consumer base that McDonald’s has lost, which could strengthen its position in the highly competitive fast food industry.
Drawing Younger Consumers
The night scene in many American cities is thriving, and many young crowds may look for convenient and affordable late-night meals. McDonald’s is a dominant franchise while it is open, and by extending its hours, it could capitalize on social activities, nightlife, and people who don’t work traditional 9 to 5 jobs.
By offering convenience and popular franchise options, McDonald’s could be on track to become one of the most popular 24-hour franchises this summer, but it all depends on overall customer experience, quality of service, and menu variety.
Operational Challenges
Despite McDonald’s offering franchisees the opportunity to stay open to midnight during the summer, each location has its own work hours and will decide if staying open later is economically viable, depending on demand.
Consumers should expect to see many locations keep their doors (or drive-thru) open into the night, but others may stick to traditional business hours. This flexibility ensures that some locations don’t suffer but rather thrive on this new strategy, as some regions will face increased operational and staffing costs with little to no benefit.
Promotions
As part of this new tactic, McDonald’s is spreading awareness and excitement through promotions in big cities like Los Angeles, Detroit, and New York. These promotions include giving away free McCrispy Chicken Strips and branded merchandise to encourage customers to take part in late-night consumer habits.
The company is also leveraging their social media to inform as many customers as possible about their expected new hours. Marketing is an important component in any brand to ensure that customers are not only aware of new business decisions but also aware of any campaigns that might accompany them. Both regulars and new consumers are expected to be attracted to eating at McDonald’s beyond traditional hours.
Benefitting Local Communities
Hiring hundreds of thousands of new employees doesn’t only ensure that quality service, reduced chances of burnout, and successful scaling, but it also has impacts on local economies and communities. A surge of new employment opportunities will supply people across America with new jobs, boosting the economy.
However, this will also increase many costs for the company, such as more wages to pay, more supplies, and increased utilities like electricity and water. If staying open is profitable, the risks will pay off for McDonald’s and could cement them as the next late-hour fast food giant. Franchise owners will need to be diligent during this time to ensure that costs are managed from franchise to franchise.
The Future Of McDonald’s
With a consumer market always changing preferences, McDonald’s is showing adaptability in extending their business hours. Customers are getting increased convenience and a wider variety of options as restaurants try to stay competitively relevant. McDonald’s now has the opportunity to reach new customers and boost its sales, but it hinges on how things are operated.
With enough staff and consumers being given reasons to come in during these new hours, the future of 24/7 fast food could see a permanent new heavyweight. If mismanaged, McDonald’s will most likely move away from changing their hours and prioritize other ventures.
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