Business: Squeeze in Fast Food

Big washout ahead

For more than a decade, the fastest thing about the fast-food industry has been its growth−in outlets, sales and profits. No area of the business has prospered more than the giant hamburger chains, dominated by McDonald's and its two smaller cook-alikes, Burger King and Wendy's. But lately, increasing costs and competition have taken some of the sizzle out of the chains. Says Wendy's Chairman R. David Thomas: "There's a big washout coming."

The chains still have room to grow, and their earnings, though slowing somewhat, will probably remain strong by any standards. But there is a growing consensus in and...

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