McDonald’s Japan has first loss in 11 years after Husi scandal

• McDonald’s Japan is forecasting a net loss of JPY17 billion (US$156.7 million), largely as a result of a lack of consumer confidence after a food safety scandal hit the quick service restaurant chain in July. This marks the first net loss for McDonald’s Japan in 11 years.
  The loss of business for McDonald’s Japan came after supplier Husi Food Co., a subsidiary of the U.S. based OSI Group, took expired poultry and beef, then repackaged it with false expiration dates to a number of restaurant customers, including McDonald’s businesses in Japan and China. McDonald’s officials were unaware of what the Husi Food workers had done.
  The food safety scandal already has had a negative impact on McDonald’s global sales, with the company reporting its August sales slumping 3.7 percent globally and its sales for the Asia/Pacific, Middle East and Africa (APMEA) region declining 14.5 percent.
  Sara Casanova, CEO of McDonald’s Japan, said at a media briefing the company is making efforts to restore consumer confidence as quickly as possible.
  “Customers have expressed a lack of confidence in our food quality, and I take responsibility for that,” she said. “It’s our intention to try to turn this business around as fast as we can.”
  OSI Group has since apologized for the scandal, closed the plant in question and restructured business operations in Shanghai, where Husi was headquartered.