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Will drive-throughs drive McDonald's growth in China?

(China Daily)
Updated: 2006-10-11 08:49

Editor's note: To customers in China, McDonald's is more than just a fast food chain, with the famous golden arches representing a branded lifestyle.

Last year, the company's sales growth at its 764 restaurants in over 120 cities throughout China was larger than anywhere else in the world.


Jeffrey Schwartz (2ond from R), CEO of McDonald's China, receives his order from a sales assistant at the fast-food company's new drive-up store in Shanghai. [eastday.com]
But the fast food behemoth, rocked in recent years by criticism of its allegedly unhealthy fare, is still working on innovative ways to push forward in the country's ever-expanding market.

Drive-through outlets are now a key element of the firm's strategy for further growth.

Jeffrey Schwartz, CEO of McDonald's China, told China Daily that drive-throughs will be a major weapon in the company's future expansion.

Q: Having established a presence in almost all the major cities in China, is there still room for growth?

A: We will have 800 restaurants by the end of this year, and by the opening of the 2008 Olympics, we will have 1,000 outlets in China. But we are not only concerned about increasing quantity, we also place great emphasis on the quality of our locations.

Q: Are you introducing a new set of criteria to choose new locations?

A: What interests us most are those "A" locations, the best trading areas able to serve customers in the best way. We are particularly interested in establishing drive-through outlets.

Nationally, the company has just opened its fourth drive-through store, in Zhoushan, East China's Zhejiang Province, adding to the three already operating, in Dongguan and Foshan, in South China's Guangdong Province, and Shanghai's Waigaoqiao Free Trade Zone.

Within the year, we expect to add 10 more drive-throughs and next year they will account for 50 per cent of new outlets, rising to 70 to 80 per cent later on.

Q: Are you testing drive-throughs in some particular cities before opening them in other parts of the country?

A: Drive-throughs are clearly a major part of our future development. We won't confine drive-throughs to any one city and we'll spread them throughout China. Right now, we are running businesses in 120 cities in China, so we are looking at virtually every city we do business in.
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