October 21, 2017

Smashburger’s Quiet Turnaround

McDonald's veterans will remember that Tom Ryan worked in McDonald's product development in the 1990s.

Ryan claims responsibility for
McGriddles, Big 'n Tasty, Dollar Menu, 
and Fruit and Yogurt Parfaits

NRN visits with Smashburger’s CEO

Here's more than you want to know
about the trademark lawsuit between 
In 'N Out and Smashburger

Intellectual Property Brief reports

Daily Paychecks?

Restaurants are trying to appeal to millennials with daily paychecks - Business Insider

October 19, 2017

Higher Food Prices?

"Specifically, if food prices climb across the board, it could be good news in 
that it minimizes discounting and helps return the restaurant industry to a 
more normalized pricing environment."

Higher Food Prices? Let’s Take the Whole Family Out! - Barron's

October 7, 2017

Just The Beginning Of The Bad Press

'Rick and Morty' fans turn on McDonald's on Twitter after sauce debacle - SFGate

Another 'Rick and Morty' fiasco: The great Szechuan sauce letdown - Tampa Bay Times

McDonald's Marketing Needs Adult Supervision

Anonymous has left a new comment on: "Great TV Appearance By McDonald's Operator": 

Great marketing as opposed to today’s FIASCO with the “limited” sauce. 

A friend told me his store got 20. Maybe one store in 300 got ANY. Brilliant. 

So customers run to their local store to be told, nope none here. And those 
who did have any had 20 packets?? REALLY? 

Only thing accomplished today was to piss off thousands of people. 

This is the future of marketing?!?? Competitors are laughing as they should be. 

Managed to screw yet another great idea up again. 

Stupid, right up there with the fork thing and rainbow fry boxes. 


McDonald's Operators can expect this kind of thing to happen a lot in the future.

Now that McDonald's USA will have mega Co-Ops, humongous ad agencies, and OPNAD 
having been spayed and neutered McDonald's marketing will be one disaster after another.

Where do such bad ideas come from? 

Not to get all political but you mentioned the rainbow fry boxes. McDonald's is run by people
of the liberal persuasion. And, advertising agencies are staffed by extreme left-wing liberals.

Liberals generally look down on the people they wish to rule and consider the population to 
be stupid and incapable of caring for themselves. Liberals think the citizens can't take care 
of their own healthcare, too stupid to handle guns, too dumb to improve their lives without 
government's help.

This attitude is a form of contempt for the average American. When corporate liberals make 
decisions with this bias the result is often abusive to their customers (or in McDonald's case, 
abusive to the Operator's customers).

Who else would think it a good idea to deliberately frustrate thousands of die-hard fans?

And now we'll hear wailing and moaning from Oak Brook about the negative press - "We had 
the best of intentions".

Like I said, now that McDonald's Operators are being taken out of the decision making loop 
this kind of thing is going to happen over and over again.

October 5, 2017

I'm Sorry, But This Is Funny

I have a real dislike of protesters, picketers, and demonstrators of all kinds but sometimes
flash mobs can be really clever. This must have been a lot of work to put together. I'm 
sure many McDonald's people will be uptight about it - but come on - it's fun!

A Mob of Phony Ronald McDonalds Bully a Burger King

Sears's History Predicts Almost Everything Amazon's Doing

This article isn't about franchising or hamburgers but those of the Boomer generation
spent a lot time in Sears stores just as subsequent generations are shopping on Amazon.

The Atlantic - Sears & Amazon

October 4, 2017

Great TV Appearance By McDonald's Operator

As someone who's done his share of television work I know a natural when I see one.
This McDonald's Operator is relaxed and funny on camera. Few can pull that off.

Makes one think, why are McDonald's Operators paying millions to public relations 
firms every year when they have such talent in the system?

WIFR TV news in Rockford IL

October 3, 2017

2017 QSR Magazine Drive-Thru Study is Out

McDonald's VP says, "The order-taking process on average takes 17 seconds in our drive 
thrus for simple orders of two to three items. For larger orders with eight to 10 items, 
it can take 50–100 seconds". 

If ordering time is important (and it is) why are some stores wasting time letting the
order taker great the customer with their name? 

The 2017 QSR Drive-Thru Study - QSR magazine

McDonald's VP is quoted HERE

October 1, 2017

Nation's Restaurant News and Fast Food

The current issue of NRN features four articles about "Fast Food" including a comprehensive piece on "How McDonald's became the symbol of fast food".

I suggest readers check out the Editor's comments. At the end of her piece there' s listing of the other four articles. From the editor: The truth about quick service

You may have to register with your E-mail, it's easy and free.


September 26, 2017

Only In Russia

Burger King Russia Wants 'It' Movie Banned Because Pennywise the Clown Is 'Exact Copy' of McDonald's Rival Clown

Is McDonald's Corp. Running Out Of People?

Less than a month ago Oak Brook's Pajama Boy sent out an E-mail listing a number of "retirements" by long term corporate employees. Among the retirees was a Jeff Wilfong 
from the Northwest Region.

This week the word is out that the same Jeff Wilfong will be the new GM in Raleigh. 

If McDonald's has any kind of bench why would they need to cancel someone's retirement 
to staff a VP position?

Downsizing is tricky, sometimes you go too far. Especially when you know so 
little about 
the business you're downsizing.

September 23, 2017

McNews From Small Town Iowa

This article caught my eye because:

* Growing up in Sioux Falls SD I had family in several of the towns mentioned here.

* The selling Operator, Steve Jackson, and I did our time in MCOPCO and Field Service
   at the same time in what was then the San Diego Region.

* The buyer says they were "selected" to buy Jackson's stores. I presume that means 
   "selected" by McDonald's Corp. 

Whatever happened to putting stores on the open market, competition, negotiations ???

Local News: ‘This is going to be our home base’

More from NRN's Maze on McDonald's Competitors

Investor: McDonald’s success is bad for burger stocks

September 20, 2017

McDonald's Taps Publicis.Sapient, Capgemini for Global IT

I've not even tried to keep up with the reshuffling of McDonald's USA ad agencies
but this one looks interesting. The new digital agency will hire about 100 current 
McDonald's employees thereby reducing McDonald's overhead. Then, going forward, 
Capgemini might be asked to bill McDonald's Operators for digital services currently 
being funded by McDonald's Corp. 


McDonald's Taps Publicis.Sapient, Capgemini for Global IT | Agency News - AdAge

September 19, 2017

McDonald's "Comeback" Hits Smaller Chains Hardest

Jonathan Maze is one of the best financial writers covering the restaurant industry 
which is why so many of his articles show up on this website. But, on this topic I think 
he's missed a fine point.

Over the past two winters (2015/2016 and 2016/2017) sales at the national QSR chains 
have been helped by extremely mild winters in the Northeast and Northern Midwest. 
The smaller  regional chains would not have benefited from the mild weather, especially
the large number of smaller chains that have grown up in the South or the Western U.S.

In'N Out, Jack-In-The-Box, or Sonic wouldn't have benefited from this weather pattern. 
Chick-fil-A maybe a little, but they are still mostly in southern and now western areas.

It kind of proves my theory when Jonathan points out that Burger King and Wendy's did
a pretty good job of keeping up with McDonald's. Of course they did, they also have a 
high penetration of stores in the states where winter weather matters.

Opinion from NRN's Jonathan Maze

Washington D.C. Has No Room for QSRs

Capitol Riverfront McDonald's, Union Market-area Burger King in the raze pipeline

Village of Oak Brook Wants Amazon

Oak Brook to bid for Amazon headquarters at McDonald's site

September 13, 2017

Stupid Wall Street Tricks

On Tuesday morning  a research firm raised an alarm about McDonald's third quarter 
earnings being harmed by hurricanes Harvey and Irma. Just because a few hundred stores
are closed McDonald's shares dropped more than $5.00. How silly.

Of course having 300 or 400 stores closed will impact earnings short term but this says
nothing about McDonald's "momentum" or future same store sales trends. This only 
impacts the short term investors who were planning on taking some action based on third 
quarter results to be released on October 24th.

During my years operating Franchise Equity Group I've learned a lot about how Wall Street
functions and count many analysts as friends. But, it's a dysfunctional process and not a 
great place to trust with our money. IMHO

Again, these closures tell us nothing about the long term future of McDonald's USA.

Marketwatch article is HERE

Crain's Chicago Business reports HERE

September 12, 2017

Management Erasing McDonald's History

Every day there's new evidence that, because management has little history with 
McDonald's, they pretend it was all a mistake and they need to "reinvent" the system.

Libertyville fighting McDonald's efforts to modernize retro building

September 11, 2017

Dunkin' Simplifying - McDonald's Getting More Complicated

"The challenge for Dunkin' is that it's not the chain known as a coffeehouse (that's Starbucks) and it's not the cheapest choice (that's McDonald's). To combat that problem, Dunkin' Brands is staking out a place as being the chain that offers quick service both through technology and by offering a streamlined menu."

How Dunkin' Donuts Has Changed in the Past Year

My Seeking Alpha Comment

Kinda happy with this one...

Been buying Mickie D's monthly for over 25 years, via the automatic investment plan. Our first shares were a gift from Fred & Patti Turner, who were really exceptional people and close family friends. Fred Turner really steered McD well, and Easterbrook is doing the same.
11 Sep 2017, 12:17 PM  Report AbuseReply0Like
Whoa - let's not go comparing the current CEO with Fred Turner. Fred built a company on customer care and convenience (QSC). This new guy is an accountant who's running the company for the shareholders. He and the know-nothing guy he has running the USA business are making some huge operational mistakes that will potentially drag down transactions and same store sales.
Give Fred his due - he and Ray built something great - this new guy is just strip mining it.
11 Sep 2017, 07:49 PM  Edit/DeleteReply0Like


August 19, 2017

Easy McMoney

On August 8, 2017

McDonald's VP Joseph Erlinger exercised an option on 10,793 shares of MCD at $57.08 - $63.25 and immediately sold the shares for $154.44 per share for a profit of approximately $1,017,870.00

On August 13, 2017

McDonald's VP David Ogden Fairhurst exercised an option on 4,782 shares of MCD at $57.08 and immediately sold the shares for $157.05 per share for a profit of approximately $478,057.00

August 8, 2017

Don't Mess With The NYPD

NYPD Steps Up Boycott of Dunkin' Donuts After Cops Refused Service

Nobody Builds Any Equity Without Real Estate Tenure

If the Lake Forest IL store is only 20 years old that means it would have been developed
and opened during the "Convenience Strategy", a misguided effort to impress Wall Street 
by building too many new stores in all the wrong places.

In the 1970s and 1980s McDonald's Corp. did an excellent job of negotiating the
purchase of new sites or obtaining long term leases. Leased sites always had the initial 
20 years set in stone with decades of options after the first 20 years. If management 
couldn't be sure there would be a McDonald's at that location in perpetuity there was 
no deal.

The idea that a store would be built with an opened ended rent number at the end of 
20 years was extremely rare or unheard of.

But that changed during the Convenience Strategy - deals were rushed, inexperienced
real estate people were hired, and uniformed brokers became involved. Many deals 
were, in a word, sloppy.

I don't know anymore about this store's lease than what's contained in this article but
McDonald's Operators should be wary of stores opened in the mid-1990s and should 
become educated on the exact status of each store's real estate. And don't accept the 
verbal representations of McDonald's corporate employees. They won't know a top 
lease from a ground lease.

High rent pushes out Lake Forest McDonald's

August 6, 2017

Restaurant Analyst John Gordon Looks At Delivery

Your mileage may vary

For a QSR franchise John uses a 5.5% "royalty" so he probably assumes the 
franchisee is paying a fixed amount for rent, not a percentage. McDonald's 
Operators would probably want to add 8/10/12% to that line item.

The "Ad Fund" line would probably be higher.

John uses a delivery commission of 25% - Yikes!

As you can see, even with a $12.00 average check this doesn't work for a QSR 
and it works marginally for a casual dining location, even with a $57.00 check.

America's Top 50 Fast Food Restaurants

Ranked by QSR magazine

August 2, 2017

McCashing In - Summer Edition

On July 26, 2017

McDonald's VP J. Krulewitch exercised an option on 11,755 shares of MCD at $75.93 
and immediately sold the shares for $158.38.

McDonald's VP Kevin Ozan exercised an option on 25,322 shares of MCD at $57.08 
and immediately sold the shares for $158.50.

McDonald's VP Douglas Gore exercised an option on 17,286 shares of MCD at $75.93 
and immediately sold the shares for $158.50.

McDonald's VP Fred Borden exercised an option on 4,820 shares of MCD at $56.64 
and immediately sold the shares for $158.37.

Source: Nasdaq.com
Source: Fox News

Texas Roadhouse’s Thumb's Down On Delivery

“We encourage all of our competitors to do as much delivery as they can so they 
can deliver lukewarm food to their people,” 

Texas Roadhouse’s contrarian view of delivery

July 26, 2017

Lyft Teams Up With Taco Bell

Said it before and will say it again - With so many QSRs jumping into the delivery business -
I think the market is very wide, but very thin - meaning - a lot of people will order delivery 
from a QSR - occasionally - so occasionally that no chain will do any real volume and with 
the commissions taken by the delivery companies it'll be a real money loser for franchisees.

Lyft teams up with Tacobell, Uber goes deeper with McDonald's

Updated WSJ Coverage on MCD Q2 Results

This is what you get when you let people who've never operated a restaurant run a 
major restaurant company.

McDonald's CEO says, "McDonald's speed of service has been declining ..... but order accuracy and quality perception scores have improved, he said, adding that he hopes
the self-order kiosks and mobile-order and pay app will shave seconds off order times."

McDonald's Sales Show Improvement

July 22, 2017

See You LAT-er

Hearing about the Leadership Alliance Team term jumps out: 
"Star Chamber". 

The term dates back to 15th century England and is also the title of a 1983 movie about a panel of judges who decide who lives and who dies.

July 19, 2017

More On Delivery Services

“A customer will equate the delivery person with your restaurant even if it’s a 
third party, so that’s something to take into account,” 

How restaurants can launch effective delivery services

July 18, 2017

Chipotle - It's Happening Again

And McDonald's is going to unfrozen beef and chicken? Good luck with that!

Chipotle closes restaurant where customers got sick - Business Insider

The above article mentions a very nasty little website that publishes anonymous 
reports of food borne illnesses as totally credible.

This will give restaurant Operators a little heartburn.


July 15, 2017

This One's Just For Me

This is the story of the McDonald's restaurant where I began my McDonald's career. 
When I was hired the store was more than a decade old so I've slowly learned about
the importance of this store to the history of McDonald's.

McDonald's history buffs or those who liked "The Founder" will enjoy.

Battle over St. Louis Park, Minnesota McDonald’s had big impact on ‘the founder’

Can Fancy Remodels Save the Fast-Food Industry?

Nancy Luna at Orange County Register

July 10, 2017

I Get This A Lot

I recently spoke with a McDonald's Operator who is thinking about blowing off some steam
by initiating a conversation with one or more Wall Street analysts. The Operator was having doubts because "I'm not a McDonald's shareholder and I don't follow the stock". 

That's not the issue - analysts don't want your input on the stock market - that's their job. Analysts want to know what's going on in the stores and in the marketplace as a counter balance to the never ending happy talk they get from Oak Brook.

It's common knowledge that I've been working with a certain analyst for the better part of 15 years. In all those years, with countless phone calls, E-mail discussions, and survey work we've never discussed the McDonald's share price or the stock market in general. He's never asked and I've never offered. My job is to help him better understand what's going on with McDonald's Operators, period. 

The same applies to all the analysts I've worked with over the years, no one's ever broached 
the subject. Wall Street analysts would have no reason to discuss share prices or trends with 
me or with McDonald's Operators.

This Is Why It's Hard To Find Good Help - Video

JP Sears Explains Why Millennials Are Today's Superior Species

July 8, 2017

High rent pushes out Lake Forest McDonald's, bank could take its place - Lake Forester

High rent pushes out Lake Forest McDonald's, bank could take its place - Lake Forester:

'via Blog this'

McDonald's And Its Debt Binge

I don't often post from Seeking Alpha because it's mostly opinion. But this concise article
is fact based and well thought out.

McDonald's Corporation (NYSE:MCD) - Seeking Alpha

Deep Thoughts On McDelivery

The first McDonald's franchise I operated was in a growing suburb 
of San Diego. The local high school was bursting with students 
and every household contained at least 1.5 teenagers. This was 
great for staffing the restaurant but there sure were a lot of crew people's "friends" hanging around the place. The first week I was working in the store I observed several instances where a 
drive-thru crew person would be running an order out to a 
parked car and bumps into one of their "friends" at the door of
the restaurant. The crew person hands the order to their "friend" 
and asks them to take the order out to the blue Chevy.

The second time this happened I called an emergency drive-thru 
meeting to establish that no one touches the food in any way 
except myself, my employees, and the customer.

I can't imagine running a McDonald's (or any kind of restaurant) and handing a prepared order to a complete stranger, a person with no accountability to me or my business, who 
would eventually deliver it to my customer.

Change is difficult and every franchise system program has pluses and minus for the franchisee. But this is the first program in McDonald's history where the McDonald's 
Operator has nothing to gain and a lot to lose.

Or is there an upside here for McDonald's Operators?

July 7, 2017

Missouri Bans Cities' Minimum Wages

St. Louis minimum wage to decrease on Aug. 28

Fast Food Makes Its Biggest Change Since The Drive-Thru

"Commissions paid to third-party delivery services risk degrading margins, so restaurants need to watch their delivery sales trends to justify the hit,"

"Delivery fees also raise costs for consumers. A McDonald's Quarter Pounder with cheese meal, with a medium Coke and fries, delivered via UberEats to IBD's Los Angeles office from the Marina del Rey area takes an estimated 20 to 30 minutes. A $4.99 "booking fee" is tacked on to the food charge of $6.89 and 60 cents in taxes, bringing the total cost to $12.48."

Investor's Business Daily reports on McDelivery

July 5, 2017

Land of Lincoln Dead Broke

If a major corporation is moving their headquarters wouldn't it make sense to move a
few miles north or south and get out of the second worst governed state in the USA?

Illinois Senate votes to override Rauner veto of income tax hike, budget - ChiTrib

June 30, 2017

Qdoba Franchisees Organize

With franchisor on the block, Qdoba franchisees organize

What's a Pajama Boy?

A few people have written to ask about the origin of the term "pajama boy" that's popped 
up here a few times. In 2013 the Obama administration launched a website to encourage 
young people to sign up for Obamacare. The website featured a picture of a young man who was apparently the model of the new American male (as defined by liberals). The internet 
went crazy with what's now called a meme and circulated many modifications to the photo.

We offer the original pajama boy here but your search will yield some clever modifications.


June 28, 2017

Who Counts The Votes?

Or, who is keeping track of the number of Operators who've signed on to EOTF?

We hear Oak Brook is claiming they've hit the magical 67%. 

Does anybody think that's true?

Another Study: Bad News For Full Service Restaurants

Study: Fast Food is Flattening Full Service - QSR mag

Study: 25% of Americans Stopped Buying Because of Politics

In my humble opinion, there's something to this - there's a change happening in our 
culture. Aside from politics, it seems more and more normal people are, if I may coin
a phrase, "Issue Spending". We've always had extremists on all sides of every issue who 
will boycott, protest etc. But now we have middle of the road parents who won't take
their kids to Sea World because of the treatment of Orcas or those to complaining
about who advertises on what TV show. These people won't be marching and carrying 
signs but they'll beat up a brand on social media and will never pull into that parking 
lot. Anyway, as the one branding expert says, 

"brands shouldn't worry about political biases of consumers and should refrain from 

getting caught up in politics". 

CMO Strategy - AdAge reports