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Taco Bell’s yearslong streak of strong U.S. sales growth is facing a challenge after a cyclosporiasis outbreak was linked to shredded iceberg lettuce served at locations in Michigan, Indiana, Ohio, Kentucky and West Virginia, The Wall Street Journal reports.
More than 1,600 people who became ill reported eating at Taco Bell restaurants in those states.
The outbreak has affected the brand’s momentum. Taco Bell voluntarily removed potentially affected lettuce in select states, Yum Brands shares fell about 9% over five trading days and third-party data shows slower customer traffic and sales growth. Analysts warn that food-safety concerns could become a measurable setback if consumers associate the issue more with Taco Bell than its supplier.
Taco Bell has been one of fast food’s strongest performers, growing through creative menu launches, value offerings like Luxe Boxes and a strong cultural identity. The brand has become a major part of Yum Brands’ business, making continued growth important as the company moves forward with the sale of Pizza Hut.
Taco Bell has faced food safety challenges before, including a 2006 E. coli outbreak that hurt sales. Like other restaurant chains that have experienced similar crises, Taco Bell relied on promotions, new products and marketing to rebuild customer trust.
Analysts expect the current outbreak to weigh on Taco Bell’s U.S. sales in the short term, and restoring consumer confidence and the brand’s cultural appeal may take time.
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