010336 Europe’s Beefburger Hurst by Mad Cow

Brussels - The beefburger is falling victim to Europe's mad cow crisis as the fast-food business rewrites menus to reflect a shift in consumer tastes.

Across the 15-member European Union, beef consumption has dropped by 28% on average since mad cow disease spread through continental Europe late last year, according to a report by the bloc's executive Commission.

Fears about the spread, via infected meat, of the deadly human form of BSE have sent restaurant sales sliding and caused food retailers to rethink beef.

“If we have another mad cow scare we'll be in big trouble,” Chris Van Steenbergen, head of Belgian fast-food chain Quick said.

The chain said earlier this week it would be serving up more chicken, fish, salad and vegetarian meals after it became clear its one-concept hamburger brand was too vulnerable.

“We want to make it less hamburger-centric. That's where the consumer is heading,” Van Steenbergen said.

Quick's decision to diversify its menu coincided with the release on Monday of its worst full-year results in three years. It reported zero net profit in 2000 compared with a 1999 profit of 9.0 million euros on flat sales of 945.0 million euros.

Even McDonald's, the world's largest restaurant company and the king of fast food, has had to diversify.

Its latest move, aimed at finding fresh markets and growth drivers beyond hamburgers, was to take a 33% stake in the increasingly popular UK sandwich chain Pret-A-Manger.

McDonald's global reach has not been enough to shelter it from wilting consumer confidence, most marked in Europe, with fourth quarter sales showing a seven percent fall. European sales slipped 10% from the year-ago period.

Last month McDonald's said first quarter sales had been hit by mad cow concerns in Europe, with German and Mediterranean consumers shunning the beefburger most.

CONSUMER CONFIDENCE

The EU Commission's survey showed German beef sales halved after the first find of BSE (bovine spongiform encephalopathy) in a home-reared animal last November -- a discovery that cost two ministers their jobs.

Italy, Spain and Greece have also gone off beef in a big way, with consumption diving by 45% to 40%.

But France and Britain -- where the human variant of mad cow disease has killed more than 80 people -- were fairly immune to changing consumer tastes. Britain even showed a three percent increase in beef consumption.

“We haven't seen any significant changes in terms of consumer demand,” said a spokesman for Whitbread UK & Ireland, which owns the Beefeater and Brewers Fayre restaurant chains.

“We have been hit though in cost prices going up, mainly for pork and English lamb. Prices have risen significantly.”

In Spain the appetite for the meat of fighting bulls, a highly-prized dish, has waned, according to Carlos Blanco Navarro. He owns Los Carriles restaurant, a meat specialist located near Madrid's main bull ring.

“Many people used to ask for our speciality, stuffed bull's tail with potatoes, but sales have fallen by 70%,” Blanco said.

Hamburger sales at leading fast food chain VIPS, which has 42 outlets across Spain selling a range of foods from sandwiches to cooked meals, have also been hit, a spokesman said.

“We haven't changed our menu,” he said. “But people are definitely switching away from meat and towards fish and chicken, especially after mad cow disease”.

In Greece major beef and cold cuts producer Nikas reported a 56% drop in 2000 group pre-tax profits while pork producer Creta Farm saw a 99% increase.

FOR SOME, BEEF IS STILL KING

But even though hamburger chains across Europe have added to their menus to adapt to changing consumer tastes they are loth to abandon the beefburger altogether.

“We've had a lot of choice on our menu for quite a long time, but beef remains king,” said UK Burger King UK & Ireland spokeswoman Emma Sturt.

Bertrand Bereaud, head of quality control at Buffalo Grill , a chain specialised in grilled meat, said his group had even chosen the opposite strategy.

“While our competitors diversified their menus, discrediting the beef product, we chose to reinforce beef. We know how to make grilled meat, we know where it comes from and we check it. The customers trust us,” he said.

He reported a major drop in sales in November 2000 as the mad cow crisis spread in Europe, but sales had risen since then and were almost back to normal levels.

“We intend to reconquer our market over the long term,” Bereaud said.

RETURN TO HOME PAGE

E-mail: sflanagan@sprintmail.com