Exceeding Expectations with Plant-Based in Fast Food
2022-01-31 16:27:21
McDonald’s McPlant burger is more popular than initially expected, according to Piper Sandler analyst Michael Lavery. In December, participating locations sold roughly 70 of the plant-based burgers it created with Beyond Meat per outlet every day in the chain’s initial small test of the menu item.
Lavery wrote in a note to clients on Tuesday that test locations were selling about three times more McPlant burgers than he initially forecast. For comparison, an average McDonald’s restaurant typically sells about 110 Big Macs per day.
Even with such a small sample size, Lavery said that early interest and willingness to try the plant-based product may be greater than expected, which would be a win for Beyond. He initially estimated a $75 million to $100 million boost in Beyond’s U.S. revenue due to the McPlant. “While we believe test stores likely received a lift from exclusivity (drawing some sales from nearby stores that did not offer it), and that sustainable, repeat sales will settle in at a much lower rate; initial McPlant sales could prove to be closer to 8% to 10% of burger sales, or $170 million to $215 million (annualized),” he wrote.
For Beyond Meat, a nationwide launch of the McPlant burger would be a massive opportunity to impress consumers with its meat substitutes, in addition to the revenue lift just from sales to McDonald’s. Consumers seeking holistic wellness offerings are demanding increasing accessibility of plant-based options that meet their expectations for a “traditional” product, as plant-based goes head-to-head with animal proteins for flavor and aesthetics.
