The decline in consumers’ consumption of fast food in the second quarter hit profits in the packaging business

Fast food restaurant customers are fed up with inflated prices, and it shows: Fast food restaurants Sales have fallen in recent earnings calls. The impact has been felt throughout the supply chain, and packaging suppliers are now hoping for new Fast food Promotions will boost volumes in the coming quarters.

McDonald’s reported a 1% sales decline from a year earlier, its first decline in four years. Many analysts pointed to the July 29 data as a harbinger of the fast-food industry’s quarterly health. Fast food “The industry has slowed significantly in the majority of our markets, and industry traffic has declined,” said McDonald’s CEO Chris Kempczinski, referring to the fast-food giant’s inflation-related price increases in recent years.

Graphic Packaging International executives discussed the impact of McDonald’s sales during their July 30 earnings call, while noting a decline in overall foodservice packaging sales.

“In the restaurant industry, after nine consecutive quarters of year-over-year growth of more than 5%, we have seen a marked slowdown,” said Mike Doss, CEO of GPI.

Other fast-food chains have described similar financial setbacks driven by consumers. Sales at Firehouse Subs and Burger King fell 0.1% in the second quarter, executives at parent company Restaurant Brands International said on Thursday morning’s earnings call. Yum! Brands, the parent company of KFC, Pizza Hut and Taco Bell, reported a 0.1% decline in second-quarter sales. Global sales fell 1% year over year in its earnings call Tuesday; sales at Pizza Hut and KFC declined 3%.

Wendy’s missed Wall Street expectations, and executives cited consumers’ desire for value during its Aug. 1 earnings call. Separately, Starbucks reported a 3% year-over-year sales decline on July 30.

Some packaging companies have already touted their partnerships with Fast food restaurantsincluding Berry Global with Taco Bell, Wendy’s and Burger King; Graphic Packaging with Chick-fil-A; DS Smith and WestRock with Pizza Hut; and WestRock with Domino’s.

So far, major packaging companies have largely avoided mentioning QSR Customers by name — with the exception of McDonald’s — during their recent earnings conference calls. They were generally referring to Fast food restaurants or restaurant customers generally, while noting the industry’s difficult quarter and the fallout throughout the supply chain.

For example, Berry Global executives said on their Aug. 2 call that inflation was behind the decline in restaurant volumes in the second quarter compared with the same quarter last year. They did not specify which restaurant customers were affected or whether the decline in demand was specific to quick-service restaurants.

Fast food restaurants The company explained how it is working to offer better value for money to re-attract cost-weary consumers. Starbucks CEO Laxman Narasimhan said one part of the coffee giant’s three-point turnaround plan is to “demonstrate the value we offer.”

Fast food restaurants Restaurants offering cheap meals in recent months include Carl’s Jr., Burger King, Sonic, Del Taco, Jack in the Box and Taco Bell. McDonald’s has become aware of consumer discontent and has announced that it will extending its value meal beyond the initial four-week period, which began June 25. And on Monday, just four days after its earnings call, Wendy’s launched a $1 Frosty promotion for the remainder of the summer.

Many fast-food executives have made value propositions to attract customers a key talking point during their quarterly calls. “We have increased our focus over the past year on providing affordable options to consumers, with all of our brands delivering disruptive offerings and introducing, or reintroducing, the Everyday Value channel,” said David Gibbs, CEO of Yum! Brands. Joe Erlinger, president of McDonald’s USA, said, “While we always work hard to deliver value to our customers, they are telling us they want to see and experience even more value.”

Some packaging companies have noticed an increase in the number of customers offering deals in recent months. GPI Doss said ” vValue promotions are gaining ground Fast food restaurantsand we’re starting to see it in our order books.” He cited expectations that McDonald’s expanded value meal offerings would hurt GPI’s results.

“I don’t think it’s a secret that the quick-service segment is clearly responding, and started responding in the latter part of the second quarter, to menu pricing and promotional efforts,” said Mike King, CEO of Pactiv Evergreen, noting more than three years of elevated inflation that left consumers “pretty hurting.” As the third quarter begins, Pactiv “is starting to see that stabilization, that trend of those volumes coming back,” he said, cautioning that the company is a little less optimistic about an inflection there, just given the speed at which it’s moving. … We’re seeing a slight improvement or flattening of that, but not what we would call an inflection.”