McD's franchisees say the brand in 'deep depression' & 'facing its final days'

[jimmy olsen]

Nooo!

http://www.businessinsider.com/mcdonalds-franchisees-say-the-brand-is-in-a-deep-depression-2015-10

McDonald's franchisees say the brand is in a 'deep depression' and 'facing its final days

    Hayley Peterson

    Oct. 16, 2015, 12:02 PM

McDonald's franchisees believe the brand is in a "deep depression" and could be facing its "final days," according to a new survey.

"We are in the throes of a deep depression, and nothing is changing," one franchisee wrote in response to the survey by Nomura analyst Mark Kalinowski. "Probably 30% of operators are insolvent."

Another wrote, "The CEO is sowing the seeds of our demise. We are a quick-serve fast-food restaurant, not a fast casual like Five Guys or Chipotle. The system may be facing its final days."

More than a dozen franchisees expressed frustration with McDonald's management, saying that CEO Steve Easterbrook's turnaround plan — which includes initiatives like all-day breakfast and a shift to digital ordering kiosks — is a distraction from the core issues of McDonald's, like food quality and customer service.

"The lack of consistent leadership from Oak Brook is frightening, we continue to jump from one failed initiative to another," one franchisee wrote.

A second wrote, "I have been in this business since the early 1970s but have not seen us this leaderless in all my time."

The company's reaction to their frustration, one franchisee claimed, is for operators to "get out of the system" and quit the business.

Several franchisees complained about all-day breakfast, saying that it has complicated kitchen operations and goes against Easterbrook's repeated promises to simplify the menu.

"The system is very lost at the moment," one franchisee wrote. "Our menu boards are still bloated, and we are still trying to be too many things to too many people. ... Things are broken from the franchisee perspective."

Franchisees also criticized the "Create Your Taste" program, which allows people to customize their burgers with premium ingredients.

"They are throwing everything they can against the wall to see what will stick," one franchisee wrote.

Kalinowski interviewed 29 US franchisees covering about 226 restaurants for the survey. McDonald's has more than 14,000 restaurants in the US. We reached out to McDonald's for comment and will update if we hear back.

McDonald's is trying to revive business following seven straight quarters of same-store sales declines in the US.

In addition to adding all-day breakfast and "Create Your Taste," McDonald's has also made some changes to its core menu items.

The company started toasting its hamburger buns longer, making its beef patties slightly larger, and changing how the patties are seared.

McDonald's has also announced plans to remove antibiotics from its chicken.

There are at least a few franchisees who are on board with the changes.

Among the myriad of negative responses to Kalinowski's survey, two franchisees expressed hopeful attitudes.

"I think our leadership is headed in the right direction," one wrote. "It will take time."

Another said, "The CEO seems to be doing OK so far!"

[Martinus]

Remove antibiotics from chicken? The final days are indeed upon us. 

[Eddie Teach]

Maybe they should figure out how to make a decent burger. 

[Syt]

Maybe they should figure out how to make a decent burger. 

http://www.reuters.com/article/2015/09/25/us-mcdonalds-organic-idUSKCN0RP21H20150925 ?

[Liep]

Maybe they should figure out how to make a decent burger. 

http://www.reuters.com/article/2015/09/25/us-mcdonalds-organic-idUSKCN0RP21H20150925 ?

The amount of positive PR they would get from going organic would be very high here. Whether or not it would save them I don't know, it might get a lot of curious people in but if it's the same filthy and smelly restaurants I doubt it can keep the customers that wants organic food.

[Monoriu]

Yeah, it is pretty bad here as well.  During lunch time, I only need to wait like 2 minutes before I can order food.  Their business has declined a lot.  10, 15 years ago, they probably made the best burgers in HK in that price range.  But now, lots of new hamburger places have appeared.  All of them serve much better burgers.  Yes, they are more expensive, but they are still affordable by wage earners.  People now don't mind paying 2x or 3x the price of a McDonald's burger for better quality.  My wife completely refuses to eat there.  I go there if I really must finish lunch within 10 minutes.  And out of loyalty. 

It doesn't help that they were caught red-handed telling nothing but lies during a food scandal not too long ago. 

[Josephus]

Maybe they should figure out how to make a decent burger. 

That would effect their kitchen operations.

[Syt]

But yeah, McD is considered to be the bottom of the burger chain over here. Over the last years quite a few independent burger places have opened up. The food court in a big mall here has three such restaurants, plus BK. Fast food chains are losing in popularity - if you want quick junk food there's a plethora of alternate options, from fried noodles to kebab to fried sausages.

The only chain here that I can think of that's actually growing seems to be Vapiano which positions itself as a more upscale Italian variant of fast food.

[DGuller]

Maybe they should figure out how to make a decent burger. 

http://www.reuters.com/article/2015/09/25/us-mcdonalds-organic-idUSKCN0RP21H20150925 ?

Steps in the right direction.  The one and only time I ate a McDonalds burger, it definitely didn't taste like it had any organic materials in there.

[Josquius]

The whole point of McDonald's is its cheapness though, going organic would probably lose that.

I've read a lot of articles on McDonald's failing but I've not really seen it on the ground. Well. Except it's weird pull out of the cities strategy in japan

[Monoriu]

It isn't just the burger.  Their French fries are crap.  If I eat it within 5 minutes of coming out of the kitchen, it is ok (but only ok).  But if I eat the fries after the burger, it becomes soft and not crispy.  And their attitude annoys me.  Only one packet of ketchup no matter how much fries I buy.  If I go to a small hamburger joint, they give me four packets without me asking.  They care.  McDonald's doesn't. 

[Zanza]

Something better will take its place.

[Josephus]

I don't normally eat McDonalds except when I've been constipated for a few days. Their Big Mac is an amazing laxative

[Monoriu]

I'll have a McDonald's meal within this week.  I'll do my part to help the company's bottom line.  It is my constitutional responsibility 

[grumbler]

"More than a dozen" complaining franchisees out of, what, 15,000?  I'd bet that, if you keep sample sizes this small, you could find that "McD's franchisees say that the earth is flat."