Coalition of Franchisee Associations

October 30, 2012

John Kujawa E-mail on McDonald's Bankruptcies

He's right there are not many bankruptcies in McDonald's but that's more about the 
way the franchise agreement is written than anything to do with financial solvency.

We don't give legal advice here but we have talked to more than a few McDonald's 
Operators who made the decision to file for bankruptcy. We can report that nearly 
every one of those Operators (former Operators) found it to be a huge mistake.

Based on these discussions we can make a few basic recommendations. If you or any 
McDonald's Operator you know is considering this as a strategy:

* Read and re-read your franchise agreement.

* Reread your franchise disclosures.

* Obtain multiple legal opinions from multiple sources.

* Explore ALL other options with your advisers.

* Do not expect to have any control or influence over the court or the process.

* Do not expect to embarrass McDonald's Corporation.

Payday for McDonald's CEO & Pres USA

On October 23, 2012 Don Thompson exercised (bought) 42,300 shares of McDonald's at $35.25 - $39.5 per share for an approximate price of $1,581,0002. He immediately sold those shares at $87.56 per share or a total value of $3,703.788.00

A few days earlier McDonald's VP Jan Fields exercised 
her option on 26,400 shares at $35.25 per share and 
immediately sold a total of 50,090 shares for a value of 

October 28, 2012

Crain's on the Dollar Menu

Crain's Chicago Business is running an article pointing out the problem with food 
inflation and maintaining the $1.00 price point. At this time the link is for subscribers 
but we'll post one when available. Meanwhile enjoy a couple of quotes from the article:

"The more you focus on value, the more difficult it is to raise prices on premium 
products, " Mr. Spieser says. (Mitch Spieser is an analyst at Buckingham Research)

"Franchisees overwhelmingly support the Dollar Menu, which they helped create", 
says Heather Oldani, McDonald's senior director of U.S. communications.
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October 27, 2012

Is the Dollar Menu the Answer to Tough McDonald's Comps?

There's been a lot of discussion in the press about Oak Brook's plan to re-emphasize the Dollar Menu and "Value". We've expected a lot of discounting to overcome the warm weather comps from the winter of 2011/2012 and have joked with analysts about seeing the Big Mac on the Dollar Menu. But, listening to Don Thompson's comments and reading analyst's notes, maybe that's not all that funny.

After all, the Dollar Menu was launched in 2002 with the Big N' Tasty as the headliner.

Chipotle Seen Becoming McDonald’s With Drive Thrus

It's fascinating to watch Chipotle tear at their successful business model attempting to satisfy Wall Street's 
appetite for year over year growth. 

The price of going public.

Chipotle Seen Becoming McDonald’s With Drive Throughs - Businessweek:

October 20, 2012

A Loss for Many People

Regretfully we must report the passing of veteran Arizona McDonald's Operator
Bill Konopnicki.

Bill's Obituary and other information is here

October 15, 2012

Drought Leads Restaurants to Raise Prices

"And this summer, a Big Mac cost $4.33 on average in the U.S., up from $4.20 in 
January and $4.07 a year earlier, according to the popular Big Mac index compiled 
by the Economist. Those increases will continue, but at a faster pace."

Really? when one can buy four or five $1.00 sandwiches for the price 
of a Big Mac?

The L.A. Times Reports

October 11, 2012

Wendy's Logo Updated

Wendy's pigtails get first touch-up since 1983

Poultry in Motion?

“As beef prices have risen and will continue to do so, many chain restaurants’ menu R&D efforts have shifted to chicken… as a way to offer innovation around a protein that is less expensive than burgers or other forms of beef,” Hayden says. Yes, the escalating cost of livestock feed will make chicken prices go up, too, but the increase won’t be as steep.

Big Bird: Why Fast Food Companies Are Suddenly In Love With Chicken | Moneyland |