Restaurants Blame Weak Consumer Confidence
Starbucks said its softer traffic trends aren't related to an individual part of the business, time of day or regionof the country. "There seemed to have been just a very broad-based, over-arching change in the consumer feel," ChiefFinancial Officer Troy Alstead said on the conference call. "We continued to grow traffic very healthily...just notquite as rapid a pace as we had in the periods prior to that."
McDonald's said it's seeing heightened competitive activity--from fast-food to convenience stores and supermarkets--asits peers spend more money on marketing. "We go through competitive pressures...it kind of ebbs and flows from time totime," Mr. Thompson said. "What matters most is to remain focused on what is within our realm of control," such asimproving its value menu items and promoting new products.
Chipotle said it's sticking to its "customer and quality first" strategy, and won't resort to discounting or "gimmicky" new menu items. Starbucks said it's all in all trying to "crack the code" on "fractured consumer confidence," whilecontinuing to expand beyond its core cafe business in the U.S., just as with its new line of energy drinks and pendinglaunch of a single-serve espresso brewer this fall.
Unlike its competitors, Panera's customer transactions grew more than it expected in the recent quarter, suggestingit's taking business from other chains.
"In essence, all boats float with the same macro-economic conditions, and what you do in the context of that defineswhether you take market share or you lose it," Panera's co-chief executive Ron Shaich said in an interview. "We can'tcontrol the economic environment, nevertheless we can make sure we are a better alternative for consumers than our competitors."