For McDonald's, a European redesign starts to pay off

August 17, 2007

The Golden Arches are going upscale in Europe - and if you haven't seen a refurbished McDonald's yet, chances are you will see one by the end of this year. Aiming to create a more relaxed, restaurantlike experience in a sophisticated atmosphere, McDonald's is replacing bolted-down, plastic, yellow and white "furniture"with lime-green designer chairs and dark leather upholstery. It is the restaurant chain's biggest revamp in more than 20 years, and, together with its franchisees, it plans to spend more than €600 million, or $806.6 million, remodeling 1,280 of its European restaurants by the end of this year.

So far, the changes appear to be paying off. Sales in Europe are ahead of those in the United States. In the first half of this year, combined sales at Europe's 6,400 restaurants rose 15 percent to $4.1 billion, compared to a 6 percent increase in America, where McDonald's has 13,800 restaurants and sales were $3.9 billion.

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