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McDonald’s Australia, Subway join fast-casual grocery trend

mcdonalds drive thru

Two more fast-casual chains are entering the grocery arena in response to COVID-19-fueled demand.

Panera is not the only fast-casual restaurant retailer using its existing ingredient supply chain to offer pick-up and delivery of grocery staples.

McDonald’s Australia and Subway are both now supplementing dine-in revenue which has been lost due to COVID-19 restrictions with on-demand grocery ordering. 

In Australia, McDonald’s franchised and McCopCo restaurants have added staple food items, like milk and bread, to their regular menus for purchase via contactless takeout and drive-thru. The retailer’s grocery offerings include full cream and skimmed milk, English muffins, and gourmet bread rolls. It expects to extend the range of core grocery offerings to include eggs and other products in the coming weeks.

“Maccas has always been committed to serving our communities,” said Andrew Gregory, CEO, McDonald’s Australia. “During this challenging time, we hope our contactless drive-thrus and new 'essentials’ options will help provide both convenience and peace of mind for customers across the country.”

In the U.S., Subway is offering pickup and delivery of grocery essentials from more than 250 stores in California, Connecticut, Oregon, Tennessee, and Washington. Products include fresh bread, bacon, sliced deli meats and cheeses, bagged and fresh vegetables, chips, and cookies. Customers can also use the page to donate subs to first responders. 

“With most Subway dining rooms closed due to COVID-19, we're using our access to food distribution to offer Subway ingredients to our local communities during this difficult time,” says a note on the Subway grocery web page.

A majority of restaurants in the U.S. have temporarily closed their dining rooms and are relying solely on take-out and delivery. Restaurant transactions fell 42% during the week ended March 29 compared with a year ago, according to the NPD Group.

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