McDonald’s Beyond Meat Test Could Be A Game Changer For The Plant-Based Category

We may soon have more of an understanding of how significant this plant-based category might be.

McDonald’s recently revealed details of an operation testing for the “McPlant” plant-based burger, co-created by Beyond Meat. The patty is constructed from components like rice, peas, and potatoes. It is set out on a sesame seed bun, topped with lettuce, tomato, onions, pickles, mustard, mayonnaise, ketchup, and slices of American cheese.

The company says, “It has the iconic taste of a McDonald’s burger because it is one.”

The test will be held in eight establishments all over the U.S. beginning Nov. 3. The markets comprise Irving and Carrollton, Texas; Cedar Falls, Iowa; Jennings and Lake Charles, Louisiana; and El Segundo and Manhattan Beach, California.

The announcement comes shortly after Beyond and McDonald’s have announced an agreement for a 3-year partnership that is a strategic alliance in January 2021 that states that Beyond will be McDonald’s “preferred supplier” for McPlant patty. McPlant patties and possibly other plant-based foods like chicken, pork, and eggs.

This patty, by the side, isn’t a new addition in its part of the McDonald’s system. The McPlant has been in use in several markets worldwide, including Sweden, Denmark, the Netherlands, Austria, and the United Kingdom. It’s still early to determine the impact this product has had, and the consumption of meat derived from plants is different according to the market, which is why forecasting can be challenging.

We do know that McDonald’s has seen a considerable number of younger customers across the U.S. in the past year, thanks to the “famous orders” promotion, with megastars such as Travis Scott, BTS, and Saweetie. The introduction of a plant-based option could boost the trend.

Gen Z and Millennial customers are more likely to consume meats made from plant sources as opposed to their counterparts from the past, and nearly half of people between the ages of 24 and 39 consider themselves “flexitarian.”

Thus, the market for plant-based dairy and meat alternatives amounted to $29.4 billion by 2020 and could rise to 162 billion dollars by 2030 and eventually comprise 7.7 percent of the world’s protein market.

Plant-based alternatives have seen early success at several McDonald’s quick-service rivals, including Burger King, Carl’s Jr., and KFC. However, there have been reports of declining market share of Burger King’s Impossible Whopper, and KFC’s Beyond Chicken isn’t yet able to grow beyond its initial testing in the early part of 2020. Additionally, Dunkin’ and Tim Hortons have canceled their plant-based offerings altogether.

It’s not that the momentum of plants has slowed down but. Pizza Hut and Little Caesars are just entering the category, and Pizza Hut parent Yum! Brands has also signed an agreement to form a strategic partnership with Beyond Meat to co-create exclusive products in the next few years.

McDonald’s might become the point of a turning point. Suppose its test goes as planned in the future and the QSR giant increases the accessibility of McPlant McPlant. In that case, the McPlant will surely change the game for the plant-based sector since McDonald’s access, and scale is incomparable. In the event of a possible roll-out across McDonald’s U.S. system would kick economies of scale into action and will likely result in more excellent prices that are comparable between the meat of animals and analog beef, one of the significant problems. At present, for instance, a kilogram of Beyond Meat is about $1.50 more than a pound of meat.

If customers can enjoy their plant-based meal in any one of McDonald’s 144,000 U.S. outlets, then they’ll probably expect to find it wherever and this could lead to more industry-wide introductions.

Of course, they’re all vast “ifs.” What we’re waiting for is the “operations” part of the McDonald’s test. It will be a struggle to add a new product to the menu while numerous restaurants struggle with historical labor shortages. If the demand exists for meat made from plant sources and other animal products, you can anticipate McDonald’s to develop a solution.

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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