0
0
Several brands have reported a decline in sales in Asia and the Middle East, with McDonald’s being the most recent.
According to the corporation, boycotts of McDonald’s products in various countries because of its alleged support for Israel have contributed to the company’s failure to meet sales targets.
According to corporate officials on Monday, the conflict in Gaza “meaningfully impacted” profitability in certain locations during the fourth quarter of 2023. The Middle East, China, and India saw far lower-than-expected sales growth during the quarter, at only 0.7 percent.
The fast food chain is just one of many American companies that have been the target of boycotts and demonstrations because of their alleged endorsement of Israel’s war on Gaza. Lists of companies allegedly backing Israel are circulating on social media, despite the fact that these connections are frequently not made explicit. The initiative is a part of a broader Boycott, Divestment, and Sanctions (BDS) movement that has been attacking firms that support Israel since 2005.
The fast food chain is just one of many American companies that have been the target of boycotts and demonstrations because of their alleged endorsement of Israel’s war on Gaza. Lists of companies allegedly backing Israel are circulating on social media, despite the fact that these connections are frequently not made explicit. The initiative is a part of a broader Boycott, Divestment, and Sanctions (BDS) movement that has been attacking firms that support Israel since 2005.
McDonald’s The fast food chain McDonald’s caused a stir among critics of Israel, particularly in the Middle East, when its Israel branch fed thousands of free meals to Israeli troops in October, the same month that Israel began its ground offensive and bombardment of Gaza, which has resulted in the deaths of over 27,000 people.
Around the world, activists have been calling for a boycott of the corporation since October. In the Middle East, where at least 5% of McDonald’s franchisees are registered, the effect has been more noticeable. The company’s sales growth target for the Middle East, India, and China was set at 5.5 percent, but it only managed a 0.7 percent gain from October to December. It is probable that this resulted in a decline in sales inside the Middle East alone. In comparison to the 8.8% growth in the previous quarter, global revenues increased by 3.4 percent during the same time.
Franchises in the United Arab Emirates, Jordan, Bahrain, Saudi Arabia, Oman, Kuwait, and Turkey released statements distancing themselves from the free meal initiative in Israel and together committed $3 million in help to Gaza.
Head
As long as the conflict continues, the company does not anticipate any major changes, according to Chief Executive Chris Kempczinski. He stated, “I think that does weigh on brands like ours. It’s a human tragedy what’s going on.”
Starbucks
Following a downturn in growth, the coffee chain Starbucks cut its annual sales projection last week. The company had previously predicted full-year sales growth of between 5 and 7 percent, but now expects both worldwide and US growth of 4 to 6 percent.
As long as the conflict continues, the company does not anticipate any major changes, according to Chief Executive Chris Kempczinski. He stated, “I think that does weigh on brands like ours. It’s a human tragedy what’s going on.”
Starbucks’ CEO, Laxman Narasimhan, said reporters that the conflict in Gaza had a “significant impact on traffic and sales” throughout the Middle East. In the US, where demonstrators have been campaigning against the Seattle-based corporation and demanding that it take a stance against Israel, sales have also decreased.
Starbucks’ problems began when thousands of baristas from more than 360 US stores, collectively known as Starbucks Workers United, expressed sympathy for Palestinians in a post on X days following the start of the Gaza war. Less than one hour later, the post was removed.
Starbucks asked the union to stop using its name and a similar emblem when it filed a trademark infringement lawsuit against it in an Iowan court. Starbucks said in the lawsuit that the post showed “support for Hamas” and had severely tarnished the firm’s brand. It also mentioned that the company had received more than 1,000 complaints over the post. The business claimed that vandals had damaged a few of its eateries.
In response, the union filed a countersuit, requesting permission from a federal court in Pennsylvania to keep using the emblem. Starbucks was also charged with slander.
Ongoing, contentious labor negotiations are taking place between the parties, with the union requesting increased compensation and more regular work schedules.
Since the beginning of the conflict, a considerable number of individuals in Indonesia, the nation with the biggest Muslim population in the world, have boycotted McDonald’s and Starbucks.
Coca-Cola
The maker of carbonated beverages has long been entangled in the Middle East’s conflicts. The Arab League formally boycotted Coke from 1967 until 1991 because the company had established a bottling factory in Israel.
Once more, lists of brands that people are circulating on social media to boycott include the red logo of the company. Although the company doesn’t seem to have triggered any recent events, its reputation as an American business and its previous ties to Israel seem to be sufficient.
The Turkish parliament decided in November to ban the beverage from the establishments that are located on their property. The distributor of Coke in Turkey revealed a 22 percent decrease in sales during the final quarter of 2023.
Thousands of Malaysians have demonstrated in support of ending Israel’s attack in Gaza. In December, the office of Prime Minister Anwar Ibrahim declared that no ship owned, flagged, or headed toward Israel could enter its facilities. Israel and the nation don’t have diplomatic relations.
Domino’s Pizza Enterprises managing director Don Meij told analysts, “It’s well publicized that American brands in Asia, and I largely talk to Malaysia in this case, have been affected by what’s happening in the Middle East right now.”
