The McDonald’s burger chain is withdrawing its meat replacement McPlant burger from the stores where it had been on offer over the past two years. McDonald’s is describing it as a pilot project and that the offer is being suspended because customers aren’t buying enough of them to justify continuation of the range.
The McDonald’s burger chain is withdrawing its meat replacement McPlant burger from the stores where it had been on offer over the past two years.
McDonald’s is describing it as a pilot project and that the offer is being suspended because customers aren’t buying enough of them to justify continuation of the range.
This will be a blow to the already struggling Beyond Meat company that manufactures and supplies the McPlant as part of its range of replica meat products made from vegetables and often referred to as fake meat products.
In the first quarter of this year, the company, which reports in US dollars, posted a net loss equivalent to €50.7m on sales equivalent to €70.5m.
In practical terms, this meant that the company lost 72 cents on every euro of sales. Total revenue also fell, down 18% on the first quarter of last year, as did the volume of sales, which were down 16%.
On Wednesday this week, the share price was trading below $7, a very long way from its $240 peak in 2019.
Original is still best
The struggle of companies producing products that are intended to substitute for original meat and dairy products is that they aren’t attracting consumers at a price point that makes them profitable to produce.
Despite a prolonged period of celebrity endorsement and hostility to livestock-origin products, demand for the original meat and dairy products has been remarkably resilient.
Consumer purchasing trends in Europe and North America have shown a negligible decline in demand for beef and dairy, with inflated purchase prices since late 2021 being a bigger threat to consumer demand than plant-based alternatives.
Future direction of travel
Just as is the case with people choosing vegetarian diets, the market for plant-based milk or meat-substitute products is limited and niche.
Across Europe and North America, between 5% and 10% of the population consume a vegetarian diet at all times and there are also a significant number of people that would describe themselves as occasional meat eaters.
Manufacturers of these products, companies such as Beyond Meat and Oatley producing a milk alternative, simply haven’t been able to build a sufficient market to make a successful business, despite the large volume of generally positive publicity that they have succeeded in attracting.
However, it would be wrong for farmers and the meat and dairy processing industries to declare victory in the battle for attracting consumers.
Just because a product hasn’t yet been developed to replace meat and dairy that has commanded consumer attraction, it doesn’t mean that it cannot happen in future.
Consumers in future can still be attracted to non-livestock-based processed or lab-grown products that pass the satisfaction test at an affordable price point.
Conventional meat and dairy products are winning the battle for consumers' attention and spend up to this point and will do for the foreseeable future.
Loyalty to our farm-based products has been retained so far, but we can never assume this will always be the way and, as the jargon from the financial world goes, “past performance is no guarantee of future results”.
SHARING OPTIONS