Is McDonald’s Exporting Obesity?

By Scott Reeves  NOV 09, 2009 1:30 PM

Overseas sales are growing, and so are foreigners' waistlines.

 


The United States, long an exporter of popular culture, may be exporting obesity to Europe, Asia, and Africa thanks to strong fast-food sales led by McDonald’s (MCD).

The World Health Organization says about one billion people worldwide are now obese. Since 1980, the number of obese Europeans has tripled. By some estimates, about half the population of the United Kingdom is overweight or obese.

“The medical community is dumbfounded by the problem,” Dr. Bernadine Healy wrote recently in US News & World Report. “Across the developing world, too, obesity has become a major affliction as people move out of poverty.”

Traditionally, a person more than 20% over the ideal weight has been considered obese. The National Institutes of Health defines obesity as a body mass index, a key for relating weight to height, of 30 or above.

In the US, about 65% of the population is overweight and obesity has doubled since 1980. The US Centers for Disease Control and Prevention reports that in 1960, the average weight of women aged 20 to 29 was 128 pounds. By 2000, the average weight for women in that age group had grown to 157 pounds, a 22.6% increase.

The concern isn’t just aesthetic: Obesity cuts lives short and increases the incidence of diabetes, heart disease, stroke and cancer.

Clearly, there's no single cause for increased obesity worldwide. But it’s curious that the rise of obesity apparently follows the growing popularity of fast food and the increased use of high-fructose corn syrup as a sweetener in soft drinks and other products that are served at many fast food restaurants.

The worldwide success of McDonald’s, the world’s largest restaurant company by sales, may offer some insight into the problem.

The company’s October sales fell 0.1% in the US, only the third time monthly sales totals have declined in 6.5 years.

In general, the recession has helped McDonald’s generate strong sales as consumers looking to stretch a buck trade down to cheaper fare, but tough economic times appear to limit breakfast and lunch sales.

Last year, sales at outlets open at least a year rose 5.3% in the US and 8.2% overall.  The weak dollar appears to have goosed October sales overseas, including a 6.4% increase in Europe and a 4.7% increase in Asia/Pacific, Middle East, and Africa.

In the third quarter of 2009, comparable sales at McDonald’s increased 2.5% in the US, 5.8% in Europe, and 2.2% in Asia/Pacific, Middle East, and Africa from the same period a year ago.

The US fast-food market is mature and filled with robust competitors, including Burger King (BK), Wendy’s/Arby’s Group (WEN), and Yum Brands (YUM), the largest fast-food operator in terms of locations and selling under the KFC, Pizza Hut, Taco Bell, and Long John Silver’s brands. So, it’s no mystery why McDonald’s looks overseas for growth.

In 1989, McDonald’s opened its first store in Moscow following a decade of aggressive expansion in Europe. Despite farmer John Bove’s 1999 decision to use his tractor to vandalize a McDonald’s restaurant in the region of France known for Roquefort cheese, the chain recently announced plans to open shop in the Louvre.

In 2007, McDonald’s opened its first drive-thru restaurant in China. McDonald’s cut a deal with China Petroleum & Chemical (SNP) to combine fast-food outlets with gas stations.

Last August, The Independent proclaimed: “Uganda Talks Exclusive: McDonald’s to open in Uganda.”

There are many factors in obesity other than consuming fast food, including exercise and an individual’s genetic makeup. But it’s hard to see how fast food, typically high in fat and sugar, helps.

The famous tagline for a Wendy’s TV commercial in 1984 asked, “Where’s the beef?” For McDonald’s the answer is increasingly strong overseas sales. A growing number of customers worldwide may discover that the result of increased fast-food consumption is hanging over their belt.

Eric Schlosser, author of Fast Food Nation, argues: “Between 1984 and 1993, the number of fast-food restaurants in Great Britain roughly doubled -- and so did obesity rates among adults…The profits of the fast-food chains have been made possible by the losses imposed on the rest of society.”

Maybe. But before we decide that hamburgers are a worldwide plague, let’s remember that while eating broiled cow in great quantity may be unwise, two all-beef patties, special sauce, lettuce, cheese, pickles, and onions on a sesame seed bun is a legal product.


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