BOTTLED milk has become a successful sideline to burgers and fries in a marketing trial run by quick-service restaurant giant McDonald’s on Queensland’s Gold Coast.
Drive-through and over-the-counter sales of two-litre bottles of light and full-cream milk have delighted NSW-based supplier Norco, and the McDonald’s franchisees whose stores began offering the bottle option, priced at $3.50 each, in mid-December.
However, independent grocery retailers in Queensland are far from impressed, blasting McDonald’s for undermining the market for a convenience store staple that has already been savagely eroded by the two-year-old $1/litre supermarket discount war.
The United Retail Federation (URF) said the trial was an “un-Australian” predatory move by “a cashed up big American bully boy brand”.
URF general manager Bruce Mills said a McDonald’s tilt at convenience grocery lines would severely impact established small “mum and dad” stores in the community.
While his 500 members were grateful that the Norco milk was not selling at a discount to rival the big supermarkets, he said some McDonald’s franchisees were talking about hoping the trial could extend to bread sales.
“McDonald’s should stick to flipping their mass-produced burgers ...leave milk and bread retailing to real local convenience stores that have served our suburbs since well before McDonald’s invaded Australia in the 1970s,” Mr Mills said.
But the trial at 14 McDonald’s outlets has been applauded by the chain’s participating licensees who had urged their corporate bosses to give it a run.
While they can’t reveal sales figures, or say when a decision was likely on whether the concept would become part of regular business at McDonald’s, the restaurant owners feel they are responding to a strong customer need by introducing the service.
Chairman of northern NSW’s farmer-owned Norco dairy cooperative, Greg McNamara, said the marketing initiative was proving a “great branding exercise for Norco”, which also supplies soft-serve ice-cream and dairy ingredients to the fast food chain.
“We look to deal with anybody who wants to use our brand positively to support their own brands,” Mr McNamara said.
“It’s an interesting concept that McDonald’s have trialled and I wouldn’t be surprised if it goes very well.” Michelle Orton-Dessaix, who owns four Gold Coast McDonald’s outlets including the busy drive-through at Burleigh Heads, said her restaurants had used Norco milk in their café products for years.
When the prospect of selling bottled milk was raised, there was no question the local milk processor would be given the business.
McDonald’s sought to use Australian-made supplies in its stores and the fact that Norco was entirely Australian owned made it a good business partner.
“This initiative is purely to meet the needs of our customers,” Ms Orton-Dessaix said.
“For a very long time, our drive-through customers have been asking us to sell them a carton of milk. Sometimes they’ll beg for a glass just to get them by.
“I can’t see it extending to bread or any other convenience items because the requests are not there for those products.”