April 20, 2009

McDonald’s ready to serve Angus burger

U.S. fast-food giant McDonald's said in a memo it would introduce a $3.99 Angus burger nationally this summer, using a larger patty and higher quality beef.

The Angus burger is to appear on McDonald's menus in August as an answer to larger burgers introduced by rival hamburger chains, Crain's Chicago Business reported Monday.

The larger burger -- weighing in at one-third of a pound -- was a challenge to the corporation, which uses electric frying equipment, Crain's reported.

McDonald's did not want franchises saddled with a switch to another cooking system while simultaneously expected them to spend $100,000 per restaurant on new equipment needed for the corporation's move into specialty coffee drinks.

It's always a good strategy to have one or two new products a year to help boost sales, industry analyst Larry Miller at RBC Capital Markets told Crain's. But I wonder how successful it will be to launch two premium products in one year.

In 2007 market testing in Southern California, franchises sold about 70 Angus burgers a day, which would translate to $100,000 per year per restaurant, a 4 percent increase in sales, Crain's reported.