McDonald’s Closes All Locations In Bolivia After Bolivian People Reject American Brand
The infamous McDonald’s fast food chain is relatively popular in South America, with over 1,400 locations on the continent. However, the chain was entirely rejected by the Bolivian market, and they have been forced to close all of its stores in the country.
The first McDonald’s in Bolivia opened in 1997 in La Paz, and at the time people were lining up around the block to see what it was all about.
Juan Ruiz, a Bolivian Mintel analyst, remembered the hype of the grand opening, saying that, “When McDonald’s first opened in Bolivia — I remember there were people waiting hours in line and in the drive-thru to get to try McDonald’s for the first time.”
In just two years, McDonald’s had 6 locations in Bolivia, and they all had a unique menu that was tailored to the food culture of the Bolivian people.
However, the success was short-lived, because after the initial excitement, sales begin to dwindle in Bolivia for the fast food chain.
J.C Gonzalez-Mendez, the former vice president of McDonald’s for South America, said the stores weren’t breaking even.
“We were having losses in the Bolivian market for several years in a row, and initial investments were not breaking even,” he said.
Experts suggest that it may not necessarily be an aversion to the taste of the food that is to blame for McDonald’s downfall in Bolivia, but rather the culture’s overall rejection of powerful American corporations taking up market share in their economy.
During a statement to the UN, Evo Morales slammed the fast food industry, saying that, “The fast food of the west is doing a great deal of harm to humankind. The major multinational food companies seek to control the production of food and to dominate global markets by imposing their customs and foods.”
Morales has also banned Coca-Cola in the country, citing similar concerns.
The struggling economy in Bolivia is another possible reason for McDonald’s decline in the country. However, McDonald’s is not just having trouble in Bolivia, they have closed hundreds of stores worldwide in recent years.
To kick off 2015, the company closed at least 700 of its stores. In the first 3 months of that year, McDonald’s saw a 2.3% decrease in sales and a 28% drop in operating revenue.
At the time, the company’s incoming CEO, Steve Easterbrook said that massive changes would be needed to improve McDonald’s struggling reputation.
“I think there is a hunger and an interest in our business to embrace change. McDonald’s management team is keenly focused on acting more quickly to better address today’s consumer needs, expectations, and the competitive marketplace,” Easterbrook said.
McDonald’s does seem to be making an effort to change by adding vegan menu items and healthier choices, but healthy eaters are still having a hard time trusting the notorious fast-food chain.
IMAGE CREDIT: Mikhail Gnatkovskiy