December 20, 2017

From Delivery Article Referenced in Previous Post

A quote from Chris Cheek, the CEO of the 115-unit fast-casual chain Newk’s Eatery.

Others, however, say consumers give chains a break when it comes to quality because 
they know it takes time between when it’s made and when it arrives at the house — 
they’re more concerned about convenience.
“Consumers give you a little bit of leeway,” Cheek said. “They’re OK with that for the convenience. A lot of us in the industry have to accept that first. That doesn't mean you 
don’t do it. Our customer is telling us to do it.”

Consumers will give up quality for convenience? This is officially the second dumbest 
thing ever uttered by a restaurant executive.

The dumbest thing ever said by restaurant executives? That was in the year 2000 when 
the introduction of the Made For You cooking system in McDonald's USA destroyed service
times and customers were turned away by the millions. The response from Oak Brook?

"Customers don't mind waiting a little longer if they know it's made just for them."

Meanwhile sales cratered and the Dollar Menu was launched in late 2002 to cover up management's mistake.

Will the same thing happen with Hot Off The Grill? 

Could be - there's a frighting similarity. Back in the days of MFY McDonald's was also 
being run by accountants with no real restaurant experience.


Anonymous said...

HOTG will not sell well because of $1, $2 & $3 When I can get a Bacon McDouble for $2 or a McChicken for $1, I am not paying $4.75-$5.00 for a HOTG even though the product is good.

Anonymous said...

We will see and I hope you’re wrong but customers did switch from $1 McDouble to full priced HOTG when tested in Tulsa. Sales of 4:1 also saw big jumps in test market stores in DFW.

I’m cautiously optimistic about HOTG but planning on a 50% EcoSure failure rate. Maybe someone on the west coast who knows firsthand from what I heard was a test market for EcoSure will chime in with the results. Rumor is 50% failure rate but by God, our UHC trays and prep utensils are washed, rinsed and sanitized every four hours at 110 deg, God forbid that a crew kid wears blue gloves instead of clear ones and God help you if you’re short one sanitized towel. Food safety is critical but nobody dares to utter a word of realistic but safe dissent and as usual, our accountant-leaders were nowhere to be found after noon on the Friday before Thanksgiving. They have all again jetted off to cozy New Hampshire to sip their favorite hand crafted certified organic, gluten free espresso served by insufferably minimalist man-bunned baristas, spending a lazy afternoon tapping on their MacBook atop vintage chairs pondering their next deep, highbrowed transformative idea that will cause maximum chaos and confusion. Whatever Modern and Progressive plan, being born into existence right now will send another wave of experienced and exceptional McDonald’s supplier reps and internal ops people out of the system, frustrated but silently voting with their career.

If these people really want to maximize any turnaround, they’re going to have to start facing reality. A good place to start is meet our employees where they are and GET OUT OF YOUR DAMN OFFICE. That message from Chris K accomplished exactly one thing. It confirmed how incredibly arrogantly out of touch he is as he cooly breezed through the office, telling us all of the excitement he’s hearing from Owner-Operators. I guess he’s speaking it into existence. And by the way, the culture and values start at the top- your subordinates will follow your example. I’ve got some advice for you, son. I’ve done this a very long time, almost as long as you’ve been alive. Get your ass in the restaurants and learn some humility. 80-20 rule still applies, the 80 is in the stores. Meet people where they are. Stop talking, quit with the asinine and impossible goalposts or whatever the hell you are calling expectations today and meet our ACTUAL crew and managers, learn our business and try for a second to put your well intentioned and lofty ideas in a file somewhere, get out there and visit about 20 random stores across the country, without your damn enterouge. While you’re there, listening to that working mom who is doing her very best, don’t forget to say thank you. If you are successful in this race to humility and realism you will learn that you’ll accomplish more when everyone trusts you. They’ll trust you when you are grounded in reality and your tactics move from push to pull, hammer to help. And when they trust you, they’ll accomplish more and we all win. Today, you guys are about as far from real as I’ve ever seen. Modern and Progressive. Yeah.

Does this sound about right?

Anonymous said...

BRAVO to the above post. SPOT ON !!!!

And I would add the Regional Office heads to the list !!!

Anonymous said...

Wait until you see the new "OPERATOR RANKING" program!!!!

Anonymous said...

Laughed at - "If these people really want to maximize any turnaround". They "those people" only need to maximize the turnaround short term 2-5yrs max, Chris K will be gone by then with millions from the system, we will then have the next turnaround expert, this is Beginning to sound a lot like BK in the 90’s. “Those people” do not care about you they only need to sell their agenda to your NLC, OPNAD & SET teams, this turnaround was endorsed by your NLC, OPNAD & SET team reps.

Just wondering what their exit strategy is for $1, $2 & $3 have not heard anyhting on that. I can see it now once we try to get off this value menu and all those unprofitable transactions for franchiseees leave the system we will be in the same cycle with company leadership “what do we need to do to get those transactions back”. This new value menu is not sustainable long-term with many items over 40% food cost and no where to make that up with drinks being discounted. But all this was endorsed by your NLC, OPNAD & SET teams so look at “those” people, these are the people you elected that are representing you, blame them not the leadership of the company corporate leadership are just good sales people and your reps cannot and do not know how to say no to unprofitable transactions.

Like BK this will all change 7-10yrs from now when some big franchisees 50+ locations are in or close to bankruptcy they will stand up to leadership and not endorse unprofitable nationwide pricing and menus as their financial future is or will be in total jeopardy they will be to big for McDonald’s to rescue them, they will not care about future restaurant growth only about staying above water that is how my crystal ball sees the future.

Anonymous said...

“They "those people" only need to maximize the turnaround short term 2-5yrs max, Chris K will be gone by then with millions from the system,”

You’re exactly right. It is clear that we no longer work within a system that attempts to work with O/O’s to maximize sales/profits at any level. In the last year, they’ve even become brazen and cavalier about it- really just honest, I guess.

They are CLEARLY interested in one thing. Themselves, and because what benefits them benefits stockholders too, they can even attempt to couch things as somewhat altruistic but the truth is that O/O’s are to be used and tossed. We have clearly become a tool and the most interesting part (and maybe surprising) is that McDonald’s employees are not hiding it. At all.

Someone asked where field service personnel will come from in the next few years- I’ll tell you. They won’t need them. There have been rumors for years but a mid-level executive recently confirmed that field service will be eliminated in the next two years.

I don’t suppose that they’re will be anyone left who understands or will stand up for our 4% by then.

My God. Look at what’s happened. The sad part is that Ray had it right...when we work together we win together. This is not that and who loses? We all know.

Anonymous said...

MCD doesn't seem to realize that McDonald's restaurants are no longer the great business investment they once were. The costs to open a store is higher, the rents are higher, food costs is higher, labor costs are inconsistent, sales are lower as it relates to operating costs, impact from MCD and other competitors are higher. The ROI is still positive but there are better business investments out there. The company is now using the franchise agreement as a weapon to force decisions that are not in the best interests of the system. Ranking operators, using first right of refusal to control store sales, attacking operator employee's, is not good management it is cheap and mean spirited. It reflects the insecurities of top management who now want to be seen as "tough" guys. They are solving one set of bad problems but replacing them with a new set that could be worse. They crow about the high stock price. However, the stock price should have been at these levels ten years ago. They allowed an entrenched bureaucracy to grow and become a huge drag on the system because they just didn't want to manage it. These costs were part of keeping cash flow from driving the stock price higher. Sure, Easterbrook takes a meat axe to the bloat cash flow increases and stock price increases. What a surprise!! The bureaucrat's were not going to reduce payroll and unnecessary positions. That obvious solution has been there for years. Declaring all out war on the operators by using byzantine methods will only create problems of distrust and discourage reinvestments and promotions. The operators will create their own underground economy within the stores. elimnating field service will be a good idea because there may be no operators to service. I still support Easterbrook's goals and what he has done but the methods being adopted by his new people are creating extream disruption. However, the operators may think we are more important than we really are at least in their minds. So, why should they care except for the fact that franchising works. If it didn't they would have been out of it years ago.