MJP –
The business is trying to win back customers, but in the meantime, a big McDonald’s supplier is cutting 400 jobs and shutting down a plant.
In the coming autumn, a McDonald’s French fry supplier will decommission a whole facility and lay off hundreds of employees.
Rising inflation and exorbitant menu pricing have driven many customers away from fast food, prompting this move.
One of the leading French fry producers in North America, Lamb Weston, confirmed the plant’s shutdown in a news release on October 1.
Fast food joints, supermarkets, and restaurants all get their frozen potato goods from Lamb Weston, a company based in Eagle, Idaho.
Just one of their plants, in Connell, Washington, some 100 miles southwest of Spokane, will be laying off 379 workers—or around 4% of their overall workforce of roughly 10,700—people.
The business has scheduled forthcoming job fairs to help the laid-off workers and encouraged them to apply for positions at other Lamb Weston locations.
At least sixty days before closures or layoffs, employees are required to be notified under the Worker Adjustment and Retraining Notification Act (WARN) in Washington.
Production at the plant ended as of September 30th, and the closure is scheduled for November 30th. On October 1st, Lamb Weston submitted the required paperwork to the Washington State Employment Security Department.
Thomas Werner, CEO of Lamb Weston, said that a “supply and demand imbalance in North America and an ongoing inflationary environment” were to blame for the company’s downfall.
Support for impacted employees and their communities, as well as the company’s dedication to transparency, were highlighted by him.
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In 2024, Lamb Weston experienced financial difficulties and saw a 35% decline in its market share.
The current predicament has not been improved, according to Werner, by McDonald’s recent efforts to entice customers with value meals that are priced lower.
Last summer, the fast food behemoth debuted a $5 combo meal that comprised a McDouble or McChicken, four chicken nuggets, small fries, and a soda.
Werner voiced his concerns about the trend of customers choosing smaller fries with these discounts, which is concerning because McDonald’s contributes approximately 13% of Lamb Weston’s sales.
Compared to 2023, the fast food business saw a 3% dip in client traffic the prior quarter, and a 2% drop overall this year, according to Lamb Weston.
Customers are upset about the price of combo meals at McDonald’s, and videos showing this anger have gone viral.
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In retaliation, McDonald’s chief executive officer Chris Kempczinski has pledged “menu innovation” and cost reductions.
Additionally, the restaurant has been experimenting with new value offerings, such as a $4.99 combo of three pieces of McCrispy Chicken Strips and 50-cent burgers for National Cheeseburger Day.
There has been some uncertainty about new features on McFlurry cups and some criticism of McDonald’s for changing its Happy Meal toy agreement.
