Report: McDonald’s In Its “Final Days” In The US

Report: McDonald’s In Its “Final Days” In The US
SHARE
THIS



Oh dear, could this really be the end of the Big Mac? Well, according to a recent study of McDonald’s franchisees in the US the future for the burger giant appears grim indeed.

The study, by Nomura analyst Mark Kalinowski, found that 30 per cent of franchisees in the US were “probably insolvent”. Respondents believed the brand was in a “deep depression” and could be facing its “final days”. Over 80 per cent of McDonald’s stores are owned by franchisees.

In May, WPP decided not to pitch for the McDonald’s creative in the US saying the management of the fast food chain made “crazy demands” in terms of costing and turnaround times. Last month it was announced that Omnicom in the US had snared the entire creative account to itself, reported to be worth some $US1 billion a year (McDonald’s creative is handled by DDB in Australia.)

The news is hardly new that the burger chain has been in trouble for some time in the US and globally, too. More competition and healthier alternatives have bludgeoned Macca’s bottom lines for almost two decades now.

Yet, one of its more resilient markets has been the Australian one. There are 940 stores in Australia which sell about $4 billion worth of burgers annually. However, it’s difficult to get actual figures on its Aussie operations as the US-listed burger chain does not release its Australian figures separately. Last September, Australian outlets were found in breach of food labelling laws for failing to correctly label the nutrition and calories in its products.

The burger chain has tried a number of new initiatives to cajole customers back such as the all-day breakfast and hiding its clown mascot, Ronald, from new marketing strategies. Here in Australia we’ve seen McCafe, revamped restaurants, design your own burgers, pop-up fries outlets and even a hipster iteration called The Corner.

And despite owners’ alleged chagrin the changes appear to have resonated. In May this year, the US HQ announced an annual profit of $US1.1 billion which was up on 2015’s $US811.5 million. In the 2015 calendar year, McDonald’s reported global turnovers of $US8.5 billion.

However, the US franchisees have complained that all the initiatives have done have distracted from the core of the business, has frustrated customers and reduced the quality of the food. Many complained McDonald’s was trying cater to everyone and had way too many items on the menu.

One respondent to the survey wrote: “The CEO (Steve Easterbrook) 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.”

“The lack of consistent leadership from Oak Brook (McDonald’s US headquarters) is frightening, we continue to jump from one failed initiative to another,” wrote another. While another called the senior management “leaderless” who’d told complaining franchisees to quit the business altogether.

“The system is very lost at the moment. 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,” another wrote. Get those Big Macs while you still can, people!

Latest News

News Unveils Delicious.Com.Au Refresh, Plus The Launch Of Delicious.Travel
  • Media

News Unveils Delicious.Com.Au Refresh, Plus The Launch Of Delicious.Travel

News Corp Australia’s premium food and lifestyle media brand delicious. has unveiled its new website delicious.com.au and launched the brand’s travel content destination delicious. Travel at an event at Icebergs Dining Room and Bar in Sydney. News Corp Australia’s director of lifestyle Fiona Nilsson and delicious. editor-in-chief Kerrie McCallum were joined by newly appointed delicious.Travel editor-at-large George Calombaris and […]

Taylors Wines Urges Vino Drinkers To Chill Their Reds Again This Summer
  • Campaigns

Taylors Wines Urges Vino Drinkers To Chill Their Reds Again This Summer

Taylors Wines is again challenging wine conventions in a new campaign that inspires wine drinkers to chill their red wines this summer. It’s widely believed that red wine should be served at room temperature. But among those in the know, popping a red in the fridge for 30 minutes before serving can make all the […]

How To Be An Introvert AND Run A Successful Client-Facing Agency
  • Opinion

How To Be An Introvert AND Run A Successful Client-Facing Agency

Emma Bannister (pictured below) is the CEO of Presentation Studio and author of the book Visual Thinking: How to transform the way you think, communicate and influence with presentations. In this guest post, Bannister – a self-confessed introvert – reveals her tips on overcoming her people fear and becoming a success… I have a classic kitchen bench, start-up […]

Opinion

by B&T Magazine

B&T Magazine
Holden Unveils Latest Acadia 4WD In New Campaign Via AJF Partnership
  • Advertising
  • Campaigns

Holden Unveils Latest Acadia 4WD In New Campaign Via AJF Partnership

Holden’s brand rejuvenation from Aussie local to full-import takes another step with the launch of the Holden Acadia advertising campaign: Holden Acadia. Arrive.  The campaign, developed by AJF Partnership, suggests Acadia drivers that they “Don’t just turn up. Arrive.” Holden marketing director Kristian Aquilina said the Holden Acadia – as well as the Equinox also launched this year – […]