But this isn’t new news. Bolivia actually waved goodbye to McDonalds back in 2002.
So what happened? I did some research but it was difficult to find reliable, unbiased information. Most case studies seemed to present from a very anti-capitalist stance, one documentary explored the company’s problems with some neutrality, and of course, some people refused to agree that this failure is something worth celebrating.
For some home-grown feedback, I put it to a local, Gonzales.
‘It’s simple’, he said, ‘they came here and tried to charge high prices for bad quality food’. ‘But isn’t all fast food pretty bad quality? Why McDonalds?’ I asked. ‘Cost was a big factor‘, he said, ‘the average Bolivian earns 20Bs. a day and McDonalds wanted 40Bs. for a meal that didn’t even contain much real meat. Burger King came along and charged a little less and their meat was better.’
This reflects the research, but I was a little disappointed. The daddy of fast food, McDonalds, had fallen on its face trying to make a mark on South America’s poorest country, but Burger King still managed to gain some ground. A country without the influence of at least one fast food giant, I realised, was difficult to find.
Business logic suggests employing a low pricing strategy to develop a brand loyal customer base in the hope that as the country’s economic situation improves, people stick with the organisation. So was McDonalds’ business model to fault? Were they not prepared to put up with a few years of loss-leading in order to beat Burger King to gaining control of Bolivia’s fast food market?
Something went wrong.
Today, Bolivia’s economic situation is still not great on a world scale. In terms of fast food, however, Gonzales assured me that they’re not missing out. ‘We have all this great local food’, he said, ‘we can produce better quality food ourselves. Why spend a fortune on American fast food that has very little nutritional value? And if people really want it, in the cities they can always go along to Burger King.’
And people do want it. Subway and Burger King outlets remain favourites of well-to-do Bolivians (an aspiration to the West?) and tourists looking for a safe, standardised eating experience. Until professional locals and young travellers alike start to place higher value on independent cafés and restaurants, fast food outlets will rule the world.
Now where is my quarterpounder with cheese? Extra fries and mayo please.