February 26, 2015

Rumor About MCOPCO

We've had comments here plus E-mails about a rumor (repeat - rumor) concerning the
threat that MCOPCO might follow Wall-Mart's lead and very publicly raise wages in the
U.S. stores. The idea being to put pressure on McDonald's Operators causing a round of
price increases which would end up raising income to McDonald's Corp.

There are arguments for and against this rumored move:

Against - MCOPCO margins have been declining for several years, raising wages would
make matters worse.

Against - Oak Brook needs to protect Operator cash flow in order to continue re-imaging,
new technologies, and the build-a-burger project.

For - McDonald's shareholders have benefited from the inflation created by increases in
the minimum wage for decades.

For - With new leadership heavily influenced by a European social agenda (quasi-socialist)
management might be eager to impress the world with more benefits for “workers”.

One thing is for sure – $1.00 menu items would have to go – if core menu prices go any
higher the Dollar Menu & More will be the only thing being sold at a McDonald's.

.

16 comments:

Anonymous said...

The difference between MCD and WALMART is WALMART has reducing its HUMAN footprint by installing SELF CHECKOUTS.

While it may be anticipated that MCD will eventually have to release KIOSK in the USA (Do to wage and liability cost increases)

I don't see any movement in the next year, or so. Its easy for Walmart to take the 100% savings in human reduction, then apply 30-40% of that savings to increasing the other human wages.

Its only the ignorance of the American public to assume Walmart is are doing it to "better" wages - ignoring the fact they been automating jobs for the last five years.

Anonymous said...

If there's any meat to this rumor I hope investors and stockholders alike are prepared to sell quickly and get out of MCD altogether because the demise will escalate beyond the existing discourse between franchisees and the corporate world to an irreparable state of no return. Franchisees all admit that the wages we pay are not what we'd like to pay but it's business and we are here to make money, these days whatever is left after the corporation strips us to keep vendors, stockholders and corporate moguls happy. For over a decade we were intimidated, bullied, threatened and too many franchisees were forced out of the system or blackballed because they spoke out against such things like Dollar Menu and the Beverage Strategy. No one who ever went to Chicago to speak out came away a victor and when they looked behind to see who was in their corner it was vacant. There is no franchisee strength because there are too many willing to sell their soul for a meager scrap at the corporate table. Up the ante by jacking the wages at McOpCo and see just how fast and furious the franchisees will retaliate. It's long overdue. Go ahead, make my day!

Anonymous said...

2 unrelated things

1 can someone that has inside information tell me/us how many operators are below the magic 6 number in percent.
I hear it's 20 percent, but that might be wrong. I am looking for better information.

2 I understand that don Thompson will be working at the palazzo during the operator summit. They are opening a dollar blackjack table in his honor. So instead of going to those 25.00 and 50.00 dollar tables you can try your luck at the Thompson dollar table.

Sharing the dream.

Anonymous said...

The system has been a Charade for at least 10 years. If Wall Street would just inquire a little closer, they would be shocked. Yes we have some the Highest Sales in QSR, however we need those just to make ends meat. It is really bad, and the charade needs to be exposed.

Anonymous said...

Mcopco has been selling stores recently. The wage hike,along with obamacare and unions would hurt operators far more than mcopco.

Anonymous said...

Bend over operators, you are about to see what kind of "partner" MCD REALLY is !!!

Anonymous said...

The turnaround summit is a sham and any operators who fall for its propaganda are fools

Anonymous said...

MCD has systematically and regularly added costs to the stores without considering the impact of the costs on rising wage rates, inflation, ect. It is part of the overall problems we are now facing. Small and large but constantly poor judgment by MCD management. A recovery is likely if they are aggressive and smart about it.

Anonymous said...

Much talk (hopefully more than talk) from Operators on the way out of the Summit. Plan to have operators pay rent & service fees at the last minute or even late to impact MCD cash flow if the Corp raises wages to $9 in McOpCo stores. Also other forms of "legal disobedience " to negatively impact MCD in the event of a wage surrender.

Anonymous said...

It's become painfully obvious that the partnership is terribly ONE SIDED

Anonymous said...

#9 above. YES!!! Pay by check ,not by bank draft and keep YOUR money in YOUR account 3-4 days longer !!!!!!

Anonymous said...

Although I support the slow pay inititave, I would also add that we should anonymously air the Corps dirty laundry to the media. This will adversely effect the stock share price and make our impact much greater. They hurt US ,we hurt them. I've had more than enough of their self serving arrogance

Richard Adams said...

Sounds like the "Chicago Way"

Anonymous said...

The Chicago Way

http://www.youtube.com/watch?v=2ScvAJG51V4

Anonymous said...

It's a done deal folks. Our QSCVP manager on the plane ride back after a few too many drinks in the Admirals Club, went on and on (loudly) about how the operators will not be hurt when Mccopco raises pay to $9.00. It's already decided . It's going to happen. Bend over.

Anonymous said...

When is this planned 9.00 increase expected to happen?

Thank you