Waistlines grow as new markets

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Bloomberg

Customers leave a McDonalds store in Sao Paulo, Brazil, with their tasty, high-kilojoule takeaways. Photo: Bloomberg.

Fast food and expanding waistlines are not just an American health concern. Even as US-based McDonald’s, Yum Brands and Domino’s Pizza work to placate anti-obesity advocates at home, they’re taking high-calorie offerings to other parts of the globe and hooking a new generation in emerging markets.

Their target customers, often part of a rising middle class with a more sedentary lifestyle, are in turn putting on the kilograms.

Eating fewer home cooked meals and consuming more processed snacks and sugary drinks, the average man is gaining weight in Mexico, Brazil and Chile faster than the worldwide average, according to the waistline index compiled by Bloomberg. The women are too, except in Brazil, where they are holding to the global average.

In all three countries, fast food is a relatively new option.

The foreign influx was in some ways similar to the one 300 years ago, when the conquistadors brought smallpox and measles to civilisations in Central and South America, said Tim Lobstein, the director of policy and programmes at the International Association for the Study of Obesity in London.

“The parallel now is the big transnational corporations also setting foot in these remote areas and bringing non-communicable diseases,” such as obesity, diabetes and heart disease, Lobstein said.

Men in Mexico gained an average of more than 6.8kg between the opening of the first US fast-food outlet in 1985 and 2010, while the nation’s women added more than 8.6kg, according to the research conducted by Bloomberg.

In Chile, men have gained 6.35kg, on average, since the first US chain opened in 1989, while women’s weight has increased 8.16kg.

Those figures are higher than the global average. Around the world, men gained about 5kg in the 30 years to 2010 and women about 4.5kg, according to the data.

Along with South and Central America, fast-food chains have been heavily focused on Southeast Asia and India.

Africa may be next. KFC, with 700 locations in South Africa, is expanding in Lesotho, Namibia and Zambia. Meanwhile, Domino’s is opening in Nigeria, and Yum has said it plans to accelerate growth with its Pizza Hut and Taco Bell chains in South Africa.

Health problems related to changes in diet and lifestyle have been well documented.

Death rates in Brazil and Mexico from cardiovascular disease and diabetes surpassed those in the US in 2008, the most recent year for which data are available from the World Health Organisation.

Chile trails those two, with a death rate from the diseases close to that of the US.

The diseases are also affecting Asian nations, though obesity rates are lower there. In China, the rate of diabetes will surpass that of the US by 2030, according to the International Diabetes Federation.

It was not just fast-food companies that were responsible, said Michael Schaefer, the head of global consumer food service research at Euromonitor International.

People were also consuming more processed and packaged foods and were moving to cities, where they led hectic lives and did not have time to exercise, he said.

“Fast-food chains, because they’re so heavily branded, are – not surprisingly – going to come to be identified with that,” Schaefer said. “But it’s not the sole driving factor.”

The companies point to other influences on diet.

“The average McDonald’s customer visits us two to three times per month. Therefore, the vast majority of meals are eaten elsewhere,” said Becca Hary, a McDonald’s spokeswoman.

US fast-food chains accelerated their overseas expansion in the 1980s and 1990s as their home market became saturated. The recession that ended in 2009 spurred more store openings abroad, especially in emerging markets with growing middle classes.

Yum, which counts KFC as one of its brands, gets about three-quarters of its revenue from outside the US, while McDonald’s gets more than 60 percent from its international business.

The cheap, high-calorie fare and advertising strategies aimed at creating life-long customers that worked so well in the US have proved effective abroad as well.

Andrea Xavier’s six-year-old son is among the new Brazilian devotees of American fast food.

“He’d eat here every day if he were allowed; he asks all week,” Xavier, a 34-year-old domestic worker, said in a McDonald’s outlet in Rio de Janeiro.

“He always sees the television ads, sees all the boys there getting Happy Meals.”

The restaurant in Rio de Janeiro was decorated with balloon animals, cut-out butterflies and bunny masks. A poster advertising a live show by Ronald McDonald hung on the wall.

Yum recently hired a general manager to open a São Paulo office and accelerate growth beyond its 100 restaurants in the most-populous South American nation. Muktesh Pant, the head of Yum’s international business, said the company saw Brazil as a “huge opportunity”.

Pizza chains also are expanding their presence in Central and South America. Domino’s, which has more international locations than domestic ones, is Mexico’s biggest US brand, with 19 percent of the market, according to the data compiled by Bloomberg.

Domino’s, which had 5 327 international shops and 4 928 in the US at the end of last year, could “easily” add 2 700 stores in its 10 most developed international markets, chief executive J Patrick Doyle said at an investor conference last month.

“It’s going to be a long time before we’re going to hit any kind of a cap on our ability to grow in international,” Doyle said.

Still, the food chains may face resistance from health authorities. Brazil, where men gained almost 8.6kg between 1980 and 2010, is considering a law that would prohibit toys from being given away with kids’ meals at restaurants.

“We need to have the law approved,” Fabio da Silva Gomes, an officer for the Brazilian Ministry of Health’s National Cancer Institute in Rio de Janeiro, said.

Children go to fast-food chains for the toys and were “hooked by the hyper-palatable food”, he said.

The companies have already been forced to make changes in menus and tactics in the US.

McDonald’s, the world’s largest dining chain by sales, will later this month start selling an egg-white breakfast sandwich with just over 1 000 kilojoules. Burger King Worldwide began selling a veggie burger in March.

In 2011, McDonald’s began putting apple slices and smaller packets of fries in its kids’ Happy Meals, reducing the kilojoules count by 20 percent. The chain was also forced by a city ordinance to stop giving away toys with its Happy Meals in San Francisco.

In Latin America, McDonald’s had cut the salt by 10 percent in its kids’ meals, which had less than 2 500 calories each, said Hary, the company’s spokeswoman.

“We believe that all food can be part of a balanced diet with appropriate exercise,” said Virginia Ferguson, a Yum spokeswoman.

KFC used cooking oil that was free of transfats and it also had lower-calorie and lower-fat items in Latin America, she said.

“Pizza is not an everyday meal, it is a treat,” said Tim McIntyre, a Domino’s spokesman.

Consumers had full control over determining how indulgent that treat was because they could customise crusts and toppings, including the amount of cheese, he said.

American consumers will have to do a lot more to undo the damage of the past few decades.

American men have gained about 8.62kg, on average, between 1980 and 2010 and women are about 8.16kg heavier, which is among the fastest weight gains in the world. – Leslie Patton from Bloomberg


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