Why The French Admire American Quickly Food

American fast food is takingover France. From recent arrivals likePopeyes and Krispy Kreme. We appreciate more Americanfast food than Americans themselves. To established favorites. Kfc, of course, because Ilove chicken. It's like the hype. It's the trend now. It's addictive, I think,and it brings very much of a.

Happiness to people. Between 2019 and 2023, morethan 1300 fast food stores opened in France, bringingin €19 billion in profits in 2023 alone. Despite its reputation forgastronomy, the French palate is changing. France is McDonald's andBurger King's second largest market outside of the US. A lot of brands want to comein France because France is.

An Eldorado. You do 2 or 3times sales more than the other country. It's a country that has ahigh propensity to eat, eat American brands and has theright demographics as well, that restaurants have foundsuccess there. So how did American fastfood companies win over the culinary conscious, finedining, Michelin star loving French crowd? CNBC visitedParis to find out. It's lunchtime in the Lilleneighborhood in Paris.

I take this menu todaybecause I love fries and, uh, I love nuggets. Between 2013 and 2023, fastfood sales increased a whopping 61% in France. McDonald's and Burger Kingare the biggest players. Their combined salesclimbed to a total of €8.3 billion in 2023. Burgers play a big role. Quick service restaurantsthat served burgers.

Accounted for about half ofthe country's sales that year. The burger has taken agrowing share of the market over the last 30 years, andhas become an essential item on every restaurant menu. But it's not only burgers. American fast foodcompanies, helped by clever marketing, built theirbrands behind iconic products.

People in France went todiscover, uh, other tastes. And when you explain thatwith a good story with an iconic burger, you succeed. For Popeyes is a chickensandwich. For McDonald's, it's a BigMac for Burger King it's a Whopper. We are the countryof the Michelin, the Michelin restaurant. It'slike gastronomy, very high standards. And still, QSRfast food is very trendy. What that shows is thateven though we appreciate.

Food, we still understandthat we love treating ourselves. In a five year span, thecountry's top performing fast food chains, excludingsubway, opened nearly 500 stores across France. Total profits for thecategory increased about 10% during that time. In the most recent decadehas really heated up from other newer concepts, morefast casual, that have gone.

Over to France. I think American conceptshave done a great job of making their offerings anaffordable indulgence. The potential of France ishuge given the appetite for the customer, for both forpizza and for American brands. So you think thatyou have a great combination. France is a global leader inculinary excellence and boasts more Michelinstarred restaurants than any.

Other country. It's home to esteemedculinary institutions like the Cordon Bleu, producingsome of the best chefs in the world. In 2022, thecountry claimed 157,000 eateries. More than halfwere traditional full service restaurants. Because of this, legacy,American Quick Service Restaurants, or QSRs, tooka specialized approach when entering the French market.

But I can tell you aboutFrench people is that we don't get fed, we eat, andactually we treat food with emotion. So whenever youbring an American brand, you can't just bring anAmerican brand. You need you need to bringemotion with your product. You need to bringconnection. Just given the cliché thatFrance is a fancier place to eat, the concepts havereally led with their best foot forward, reallyfocused on modernized.

Images, higher quality,higher price point, more innovative offerings aswell. That includes sourcing mostor all ingredients from French farmers, like thepotatoes used for McDonald's French fries and thechicken in Popeyes sandwiches. It's very important to buildthis relationship. They have strongpartnership with the farmers. That's why theQSR, American brands have.

Succeeded. American QSRs have adaptedto European Union food standards, and as a result,those products are healthier and less processed than theUS offerings. These brands also cater toFrench palates by altering menu items or creating newproducts. But if we speak specificallyabout pizzas, you know what it takes is that you needto become French friendly when it comes to theproduct that you are.

Offering. The one campaignthat we've been running every year for the past sixyears, it is the raclette and people love it. Our most successfulcampaign every year was the raclette. And it's paid off. Many consumers now considerthe chains to be just as much French as they areAmerican. It feels like it's part ofus now.

It's American based, but wedon't really see the difference. There's KFCs McDonald's everywhere. McDonald's has the strongestfoothold, in part because of its first-mover advantage. McDonald's was the firstquick service concept to go to France and foundtremendous success there. And I think as a result ofthat, you've seen that a lot of folks have wanted toreplicate that success. Burger King, on the otherhand, reentered after a 15.

Year hiatus in 2012. Now, it boasts the secondhighest number of American QSR franchises in thecountry. Pizza hut arrived in 1987,KFC in 1991, Subway in 2001, and Domino's in 2006. But their rapid expansionshappened mostly in the past decade. Popeyes and KrispyKreme opened their first French stores in February2023 and February 2024. It's a new brand in Franceand it's very, very.

Fantastic for the Frenchpeople. Shifts in French societylike digitization have allowed the fast foodindustry to flourish. Takeaway, drive thru, clickand collect delivery. All the QSR restaurants cando that. It's a perfect match fortoday's needs, with the hybridization of conceptsaccelerating even further in the wake of Covid. We have a very small part,for instance, now of our.

Customers coming at thecounter to order. I mean, like it's less than10% of our orders, 60% are online. 1 in 5 meals in France iseaten outside the home. Experts predict that numberwill increase. It's a young population, uh,high immigration population, as well as the fact thathigh GDP per capita country that leads to strong uniteconomics across the industry.

America's pop cultureinfluence is another powerful tool. For young people, they grewup watching series or movies where in America, you know,they were eating fast foods. So I think now, uh, when wesaw fast food coming in France, all the youngpeople were pretty excited about that. Bigger portions and modestpresentations appeal to even the most delicate palate.

High inflation andshortened lunch breaks have contributed to a need forconvenience. The American food is tasty, big. You know that you willbe… Lunchtime today is around 42minutes. This prevents people fromgoing home and therefore encourages out of homeconsumption. The QSR American brandsrespond perfectly to this problem with thedevelopment of digital tools.

To improve consumer qualityof life. I really like good food, butyou need a budget for that. So when I want to have areally good French food, I take my time. It's usuallyon the weekends. During my working time, iprefer to go to fast food. But the restaurant industryis volatile and highly susceptible to domestic andglobal changes. In 2024 McDonald's andStarbucks executives said that boycotts related tothe war in Gaza caused Q4.

2023 sales to slump incountries with a high Muslim population. That includesFrance, which holds the largest Muslim populationin Europe. After all, France accountsfor 7% of the fast food chain's total revenue. McDonald's also blamed itsoverall weaker performance on pricing backlash,acknowledging a sales drop in the US but notcommenting on international markets.

Something I don't like isthe string inflation. They reduced the size ofthe burger and they raise the price. Subway has closed more than100 of its French storefronts since 2015. I think the more near-tumrisk is going to be more macro oriented, that Franceseems to be the first European market that'sreally succumbing to restaurant industry trafficand restaurant industry.

Traffic softness. Staying competitive in thenew digital age can be tricky even with decades ofexperience. We come from a world wherebefore 2016, the only people that were delivering werepizzas and sushi. I compete with pizzas onone hand, so I need to be the best in class in thatuniverse. But I also need to be thebest in class on the delivery business becauseagain, in front of me, I do.

Have sure actors likeMcDonald's and BK that are between 7 and 12 timesbigger than me. Not everyone has welcomedthe expansions. A neighborhood collectivein Paris's 20th arrondissement protestedagainst a new Burger King in 2023 over, quote, outdatedenvironmental practices. France implemented new lawsthat same year targeting fast food companies overwaste. Now, Qsrs are required tooffer reusable cutlery and.

Cut down on single-usepackaging. We have created dishesespecially for the brand restaurants and theirsustainability seems better than the others. The QSR market in France hasa lot more room to grow still. Chipotle, forexample, has only six locations so far. Taco Bell has not enteredat all. The burger, the beef, thechicken, and maybe the tacos.

In the future. Steak n shake now boasts 37locations. Carl's Jr is playing catchup after breaking ground on its first French locationin 2023. Wendy's is supposedlyplanning a move to. The next push is going to bemore of a focus on chicken, which we know in the UnitedStates to be higher margin as well as more youngerconsumer focused. One of the missions wasalways to make our product.

Broadly available. That's in the next fiveyears. We already have close to 500 stores. There is a big potential,but there are other ways to distribute our products.And that's where also like we're looking atalternatives. We have the pizza distributor. The industry is projected tobe worth about €21.5 billion by 2028.

And so far, the Frenchpalate seems ready for it. The taste is reallydifferent in front of the other restaurants. I think they have a specialtouch and that changes everything.

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