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McDonald’s to speed up growth in China

Chain to hire 50,000 workers this year as part of plans to open 700 units by 2013

McDonald’s Corp. said this week that its store growth and hiring are about to accelerate in China, with plans to open 700 new stores in the country by the end of fiscal 2013 to bring its total restaurant count there to 2,000.

McDonald’s China also said it would hire 50,000 people this year to staff new restaurants, a move similar to this month’s National Hiring Day in the domestic McDonald’s system, which resulted in more than 62,000 new “McJobs” after the chain fielded more than 1 million applications.

McDonald’s China chief executive Kenneth Chan said in a statement that 1,000 of the new employees would be college graduates meant for management positions.

“Our people are critical to our long-term success,” he said. “McDonald’s is expanding faster in China than in any other market in the world, so this is the right time for talented individuals to join our winning team.”

Don Thompson, McDonald’s Corp.’s president and chief operating officer, had just returned from visiting China when he told securities analysts last week that he was “extremely impressed” with that market’s 6.5-percent increase in first-quarter same-store sales and with new restaurants opening across the country. Company officials had said back in December that McDonald’s planned to open between 175 and 200 restaurants in China this year.

“The training that we have going on right now as we accelerate for the new openings [in China] and we accelerate openings has been phenomenal,” Thompson said during a conference call April 21 to discuss McDonald’s first quarter results. “Our 6.5-percent [increase] is based upon a tremendous guest count growth, not just taking price. What that means is that we are building quite a bit of breakfast traffic. We’re building quite a bit of lunch traffic with our value strategies.”

The chain’s locations in China discarded those value promotions in November 2010 and saw a dip in sales, Thompson added, “so we’ve gone right back to our value messaging around lunch and breakfast, and it’s paying great dividends.”

China remains a hotbed of expansion opportunity for American quick-service brands. Yum! Brands Inc. has about 4,000 restaurants in the country between its KFC and Pizza Hut along with its 21-unit East Dawning concept. In addition, Yum recently expressed interest in buying a majority stake in the Little Sheep casual-dining concept in China, a brand in which it already owns a 27.2-percent share. Wendy’s also has big plans for China in its renewed international-growth push. Wendy’s/Arby’s Group Inc. has said that a majority of a potential 8,000 Wendy’s locations overseas are projected to open in China, Brazil and Japan.

Oak Brook, Ill.-based McDonald’s operates or franchises more than 32,000 restaurants worldwide, including more than 14,000 locations in the United States.

Contact Mark Brandau at [email protected].


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