Burger Chain Plans Two Swiss Hotels

The rooms are affordable, the cuisine is American casual, and be sure to tip the clown named Ronald McDonald carrying the bags to your room.

The Swiss arm of McDonald’s Corp., known for its french fries and Big Macs, recently unveiled plans to open two four-star Golden Arch Hotels by next spring, a first for the world’s largest restaurant chain. The first two are scheduled to open in Switzerland. The Golden Arch Zurich Airport and the Golden Arch Lully A-1, whose names reflect their locations (the latter along a new stretch of highway), will naturally adjoin McDonald’s eateries.

Big Macs and Internet Access

McDonald’s Suisse Holding SA, which has 116 restaurants and is headed up by Chairman and Chief Executive Urs Hammer, will open the hotels in an effort to build the hamburger brand and attract new customers.

Amenities at the hotels, aimed at business travelers during the week and families on weekends, will include adjustable beds, high-speed Internet access, a child-care center and soundproof walls.

In the tradition of McDonald’s restaurants that aim to offer diners an affordable meal, Golden Arch hotel rooms are moderately priced with rates ranging from 154 to 189 Swiss francs, or about $86 to $106.

McDonald’s said it will watch the progress of the hotels, but right now there are no plans for a widespread launch of McDonald’s-branded hotels, a U.S.-based company spokesman said today.

“Each of the 100 countries where we operate is free to unleash innovation and new ideas to develop the brand,” said Walt Riker, a company spokesman. “This is an individual, innovative approach by one company in our system. We’ll see what happens. The first thing is to get them [the hotels] open and have people coming in this spring.”

More Than Just Hamburgers

Hammer, like the company’s restaurant operators in the United States, can make menu additions or try novel ways to build their business and draw customers. For example Hammer has put McDonald’s food on Swiss trains and airplanes. In the United States, some McDonald’s serve fresh-baked cookies, have in-store ice cream parlors, Internet access or crystal chandeliers and oak paneling.

In recent years, slowing sales have forced Oak Brook, Ill.-based McDonald’s to search for ways to grow its business without cannibalizing sales at its 23,000 hamburger restaurants located in 110 countries.

Year-to-date U.S. sales through Oct. 31 at company-owned and franchised restaurants were up a modest 3 percent to about $16.4 billion, while year-to-date sales in Europe were down 2 percent at $7.84 billion, hit by a strong U.S. dollar.

McDonald’s efforts to grow non-hamburger sales in Europe include the operation of 40 United Kingdom-based Aroma Cafes, which sell cold sandwiches and coffee.

In the United States, McDonald’s operates Chipotle Mexican Grill, Boston Market and Donatos Pizza restaurants. These other brands, however, represent a only very small part of the burger chain’s sales. In 1999, non-hamburger restaurants had sales of $91 million. That compares with McDonald’s total sales of $38.5 billion.

McDonald’s is also expected to test three diner-style restaurants in its Western U.S. division next year.

Shares of McDonald’s were up 1/16 at $32-3/4. The stock notched a 2-year low on Sept. 14 after the company warned that the effects of a strong U.S. dollar may cut 2000 earnings. The stock has a 52-week high of $48-1/8.

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