The restaurant industry in 2016 had another challenging year as a result of uncertainty about the presidential election that pervaded consumer sentiment; lower food costs at grocery stores; and diners’ rekindled desire to eat at home, with same-store sales across the sector declining throughout the year.
Wage inflation added pressure to this already-difficult environment, cutting into restaurant bottom lines. By the summer of 2016, some Wall Street analysts were warning of an impending restaurant recession.
These macroeconomic challenges are reflected in the 2017 FORBES Global 2000: some of the biggest restaurant names on the list — including McDonald’s and Yum! Brands — find themselves sitting at lower rankings than they did just one year ago.
McDonald’s is the top-ranked restaurant company on the Global 2000; it came in at #215 on the overall list, down from #189 in 2016 and sitting lower than the likes of Aflac, Lowe’s and Christian Dior.
McDonald’s has also seen heightened competition from the fast-casual sector (i.e, chains like Shake Shack, Chipotle, Panera Bread), but its all-day breakfast gambit has been a boon to earnings, and Wall Street analysts seem to think that the company has even sunnier days ahead.
“McDonald’s scores have begun to significantly improve–in many cases more than peers,” RBC analyst David Palmer recently said. “While McDonald’s affordability and convenience scores are at-or-below average, we believe these are poised to rise significantly over the next year.”
The other top ranked restaurants in the Forbes Global 2000 include:
- U.S.-based Starbucks (ranked 370 in Global 2000)
- U.K.-based Compass Group (ranked 486 )
- U.S.-based Yum! Brands (ranked 729 )
- Canadian-based Restaurants Brands International (ranked 1066 )
- U.S.-based Yum China Holdings (ranks 1224)
- U.S.-based Aramark (ranked 1237 )
- U.S.-based Darden Restaurants (ranked 1264 )
- U.K.-based Whitbread (ranked 1529)
