McDonald's supersizes sales in UAE

An improving consumer sentiment, increased tourist arrivals and school holidays propel McDonald's sales in the UAE by nearly 10 per cent.

The fast-food giant's sales grew thanks to increased tourist arrivals, school holidays and improving consumer sentiment.

Fast-food diners in the UAE are tucking into McDonald's at a faster rate than their western counterparts as spiralling local sales outpace the global average. Global sales last month for the world's largest chain of hamburger fast food restaurants grew by 4.8 per cent, but it rose by more than double that in the UAE. Rafic Fakih, the managing director of McDonald's Emirates, said sales at its outlets increased by about 10 per cent last month. Across the Asia-Pacific region, the Middle East and Africa, McDonald's sales grew by 10.5 per cent, ahead of the 0.6 per cent growth in the US, and 5.4 in Europe.

The local boost was helped by tourists coming in for the Dubai Shopping Festival, regional school holidays and an improved consumer sentiment in the Emirates, Mr Fakih said. "Psychologically, we are far from the shock of 2008 and the beginning of 2009," he said. "-In general visitors to the UAE are coming back to normal trends." The rebound in McDonald's sales came after a difficult year for retailers across the board. With their budget-friendly menus, fast-food retailers have fared relatively well but the McDonald's global sales growth rate has nearly halved. Its comparable global sales grew by just 3.8 per cent last year, down from an increase of 6.9 per cent in 2008. The impact was more prominent in the Middle East, the Asia-Pacific and Africa, which had same-store sales growth of 3.4 per cent last year, down from 9 per cent. In Europe, the sales growth dropped to 2.6 per cent from 4 per cent, and in the US to 5.2 per cent, from 8.5 per cent.

But McDonald's global sales improved last month, with a growth of 4.8 per cent, up from 1.8 per cent in the same month last year. One contributing factor was the celebration of Chinese New Year in many markets, McDonald's said. The Emirates benefited from this, too, as Chinese tourists flocked to Dubai and Abu Dhabi to celebrate the occasion. The Emirates Palace saw a 600 per cent increase in guests from China during the week surrounding Chinese New Year on February 14. Hunter International Tourism, one of China's largest travel agencies, said tour bookings were up 50 per cent in Dubai and 30 per cent in Abu Dhabi.

Mr Fakih was optimistic that McDonald's Emirates's sales this year would be 7 per cent to 10 per cent more than last year, but the figures were unlikely to reach the 14 per cent growth it saw in 2008. [e-mail]