Iceland says goodbye to the Big Mac

In the October 26, 2009 article "Iceland says goodbye to the Big Mac," Associated Press writers Gudjon Helgason and Jane Wardell report that economic conditions are causing the closure of Iceland's three McDonald's restaurants.

REYKJAVIK, Iceland – The Big Mac, long a symbol of globalization, has become the latest victim of this tiny island nation's overexposure to the world financial crisis.

Iceland's three McDonald's restaurants — all in the capital Reykjavik — will close next weekend, as the franchise owner gives in to falling profits caused by the collapse in the Icelandic krona.

"The economic situation has just made it too expensive for us," Magnus Ogmundsson, the managing director of Lyst Hr., McDonald's franchise holder in Iceland, told the Associated Press by telephone on Monday.

Lyst was bound by McDonald's requirement that it import all the goods required for its restaurants — from packaging to meat and cheeses — from Germany.

Costs had doubled over the past year because of the fall in the krona and high import tariffs on imported goods, Ogmundsson said, making it impossible for the company to raise prices further and remain competitive with competitors that use locally sourced produce.

A Big Mac in Reykjavik already retails for 650 krona ($5.29). But the 20 percent increase needed to make a decent profit would have pushed that to 780 krona ($6.36), he said.

That would have made the Icelandic version of the burger the most expensive in the world, a title currently held jointly by Switzerland and Norway where it costs $5.75, according to The Economist magazine's 2009 Big Mac index.

The decision to shutter the Icelandic franchise was taken in agreement with McDonald's Inc., Ogmundsson said, after a review of several months.

McDonald's, the world's largest chain of hamburger fast food restaurants, arrived in Reykjavik in 1993 when the country was on an upward trajectory of wealth and expansion.

The first person to take a bite out of a Big Mac on the island was then Prime Minister David Oddsson. Oddsson went on to become governor of the country's central bank, Sedlabanki, a position that he was forced out of by lawmakers earlier this year after a public outcry about his inability to prevent the financial crisis.

Lyst plans to reopen the stores under a new brand name, Metro, using locally sourced materials and produce and retaining the franchise's current 90-strong staff.

Ogmundsson said it was unlikely that Lyst would ever seek to regain the McDonald's franchise with Iceland still struggling to get back on its feet after the credit crisis crippled its overweight banking system, damaging the rest of its economy, last October.

"I don't think anything will happen that will change the situation in any significant way in the next few years," Ogmundsson said.

It is not the first time that McDonald's, which currently operates in more than 119 countries on six continents, has exited a country. Its one and only restaurant in Barbados closed after just six months in 1996 because of slow sales. In 2002, the company pulled out of seven countries, including Bolivia, that had poor profit margins as part of an international cost-cutting exercise.

McDonald's restaurants to open at the Louvre

In the October 4, 2009 Telegraph article "McDonald's restaurants to open at the Louvre," Henry Samuel says "It is a move which has managed to get both France's art lovers and gastronomes choking on their Gitanes."

Lovers of France's two great symbols of cultural exception – its haute cuisine and fine art – are aghast at plans to open a McDonald's restaurant and McCafé in the Louvre museum next month.

America's fast food temple is celebrating its 30th anniversary in France with a coup -the opening of its 1,142nd Gallic outlet a few yards from the entrance to the country's Mecca of high art and the world's most visited museum.

The chain faces a groundswell of discontent among museum staff, many already unhappy about the Louvre lending its name and works to a multi-million pound museum project in Abu Dhabi.

"This is the last straw," said one art historian working at the Louvre, who declined to be named. "This is the pinnacle of exhausting consumerism, deficient gastronomy and very unpleasant odours in the context of a museum," he told the Daily Telegraph.

Didier Rykner, head of The Art Tribune website found the idea "shocking".

"I'm not against eating in a museum but McDonald's is hardly the height of gastronomy," he said, adding that it was a worrying mixture of art and consumerism. "Today McDonald's, tomorrow low-cost clothes shops," he said.

McDonald's confirmed that a restaurant will open next month. The Louvre confirmed it will be positioned in the underground approach to the Louvre, known as the Carrousel du Louvre.

The stonewalled gallery was opened in 1993, five years after the famous Louvre pyramid. The Carrousel's initial remit stipulated that its "commercial activities will be regulated and restricted to cultural or tourist activities".

The Louvre has the right to protest against boutiques it considers fail to meet such criteria. However, the museum told the Daily Telegraph it had agreed to a "quality" McCafé and a McDonald's in place by the end of the year, which it said was "is in line with the museum's image".

"The Louvre welcomes the fact that the entirety of visitors and customers, French or foreign, can enjoy such a rich and varied restaurant offer, whether in the museum area or gallery," the museum said in a statement.

The McDonald's would represent the "American" segment " of a new "food court", and would be situated "among (other) world cuisines and coffee shops," it wrote.

It added that the franchise owner "has taken the utmost care in ensuring the quality of the project, both in culinary and aesthetic terms".

Louvre Pour Tous, a website whose aim is to "inform and defend" museum visitors, said: "Henri Loyrette, president of the Louvre museum just had to say one word to stop the whiff of French fries from wafting past the Mona Lisa's nose. He chose otherwise."

There was already an outcry last year when Starbucks opened a café perilously close to the Right bank museum's entrance. Employees and art aficionados sent management a petition in protest; the café opened regardless but was asked to provide a cultural corner of brochures and catalogues as a placatory measure.

"Starbucks was bad enough but McDonald's is worse," said the Louvre art historian.

A new ticket hall is due to be built in the next three years by the site of the new McDonald's to cope with the eight million annual visitors.

"Once this happens, the first thing visitors will likely see when they arrive are big golden arches," he said.

Many in France view "McDo" as the Trojan horse of globalisation and the scourge of local produce and long lunches.

José Bové, the mustachioed anti-GM crusader shot to fame after bulldozing a McDonald's in 1999 to protest against malbouffe (junk food).

However, even if there were a last-minute u-turn at the Louvre, statistics suggest the battle of Le Big Macs has already been lost. France has become McDonald's biggest market in the world outside of the US, according to the chain. While business in traditional brasseries and bistros is in freefall, the fast food group opened 30 new outlets last year in France and welcomed 450 million customers – up 11 per cent on the previous year.