If they can force new competent blood on the board that will be a huge step forward. The Real Estate ideas are nothing new. Selling stores is the best way to go to inject cash into the company and to increase sales in those stores. The best thing they can do is to just run a better business. Delete the fluff. Close more regions. Focus on making money.
And don't forget the operators. I've heard that over half of all owner/operators do not meet financial minimums and things haven't gotten better lately. Expensive remodels/rebuilds with no ROI. Failed expensive experiments such as McCafe (espresso based drinks...when did shakes and orange juice become "McCafe" and are they included in the numbers?!). Complexity that makes it too expensive to run a good and profitable operation. Rent structures that make it impossible run a profitable restaurant. New stores that don't even come close to sales projections and thus destroy those that are doing well. Spending marketing dollars to prop up products that our customers clearly don't want. I could go on and on.Point is, if the operator runs great operations and takes good care of his people and his community, he has held up his end of the bargain...That's what Ray intended from the beginning. I think he even said his dream was to allow ordinary guys who work hard to get rich by doing so. The franchise model should reflect his vision and decisions made in the last 5-10 years have decimated many operators. If half of all operators have crossed into not meeting financial minimums, something is definitely wrong. I believe that it isn't just one thing...It's been incremental steps away from what Ray had in mind.Owner/Operators are the most important stakeholder in this equation. Significant decisions need to be quickly made to right wrongs and to set us on a path to sustainable prosperity.
I am one who is not any longer financially approved twenty year O/O with 2 points on the McDonald's new point system. But I have a rebuild & MRP which they say I should be proud of (which I am not no sales increases) and more restaurants they want me to go in debt on. Until the NLC puts a stop to this we will continue down this financial ruin.
Well grow old waiting for the NLC or OPNAD to do anything that helps the o/os.They are there to enrich themselves.
We will either grow old or go broke!
My opinion is that an "ACTIVIST" Investor will push O/O considerations down even further. They will strip out the best assets and profit from the sale. MCD system is broken badly. And, we need to fix it and demand to be heard. Boycott Las Vegas and draw a hardline on reinvestments. Those who have been around for a long while tend to think the philosophy of Ray Kroc and others is still alive. Forget it, That philosophy and those kind of relationships are dead and gone. That Corp. Culture that we all loved and defended is no more. MCD today is about top line sales and real estate. The three legged stool is a memory. Learn to adjust and make money for yourself.
Indentured Here: I will try to be objective with my comments. McDonalds has an even worse perception than before the Sales Declines. This perception cannot be fixed quickly if even at all. They should be looking at how do we keep this World Wide Brand from becoming an IBM. It is happening right before their eyes. Operators are very weak because of debts that "normal" banks would not lend to if not for a corporate guarantee of defaults. Absolultely No direction at the top and No clear leader with a good idea. I am very fearful of the outcome. Huge "public perception" problem. Just focus on cheap fast food. We all know McDonalds does great things for communities, but stop thinking that the new generation will hold onto values that McDonalds tries to have the masses hold dear. Stop living off The Ray Kroc Era. That train is long gone, and no one really cares. Focus on the Business and Focus on the Operators who have followed you like lemmings into this MESS!!!!
When McDonald's realizes to take care of their O/O's first before the shareholders they will solve the formulae for a win/win.When O/O's do well and are in the green, and growing their business, shareholders will be in the dark green. If O/O's are struggling and morale is down because we are working to pay rents and wages, how much human enthusiasm can there be to shine as brand ambassadors that we are. The ripple effect than sends a message to the market and share values decline. Nobody wants this, it doesn't look good on anyone with a stake in McD's.
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