The fast food giant has announced that it is to close its three outlets in Iceland and has no plans to return. Besides the economy making it too expensive to operate the franchise, McDonald’s blamed the “unique operational complexity” of doing business in an isolated nation with a population of just 300,000.
Iceland’s first McDonald’s restaurant opened in 1993. The franchises are run by a firm called Lyst, with owner Jon Gardar Ogmundsson saying the decision was “not taken lightly”.
He said that the restaurants imported the goods from Germany, but that costs had almost doubled, with the falling krona making imports prohibitively expensive.
Mr Ogmundsson said the restaurants had “never been this busy before… but at the same time profits have never been lower”.
“It just makes no sense. For a kilo of onion, imported from Germany, I’m paying the equivalent of a bottle of good whisky,” he added.
He now plans to run the restaurants under another name so that he is able to buy cheaper Icelandic products.
Iceland’s banks collapsed at the height of the global credit crisis – wrecking the country’s economy and forcing it to rely on an $10bn (£6.1bn) international aid package.
© FoodBev Media Ltd 2020
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