October 17, 2018

McDonald's Franchisees Stage a Revolt

McDonald's franchisees stage a revolt, forming 400-member group
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17 comments:

Anonymous said...

Crains is a little one sided. Im not sure this is a full blown revolt... This is merely a way to stop opnad and the rest of the LAT to unilaterally take further action.

Anonymous said...

If you read the entire article it seems right on the money. The Headline is Click Bait.
I agree it is Not a Revolt. However we are seeking a rebalancing of power. Many of the folks under Easterbrook have become Drunk on their perceived power.

Threatening Owners with No Rewrites, when not appropriate
Stating, If you don’t like it, then sell
I am in charge and we will do it my way
We have catered to the U. S. Operators way to long.

All of these are inappropriate for a positive working relationship. Time for a Group to be My Advocate.

Anonymous said...

This is not a revolt. We simply believe that the MCD leadership of the US business is doing things and making decisions that are going to severely damage the business and ruin many operator organizations. Some of it by design. Several people leading the U.S. business have no experience in this industry and think they know more than they do. This is reality not a textbook. Many things done by Easterbrook were necessary and the right thing to do. The company had become a country club for it's bureaucracy. However, it became clear that tactics used by U.S. leadership were mean spirited and harsh. All of it must stop and move forward without the animosity that has been created. I can't believe that grown adult executives can be so stupid and they are.

Anonymous said...

Rumor has it that Easterbrook is livid over the groups formation and frets about its effect on the stock price. Supposedly, Chris K is urging strong armed confrontation to neuter the group.

Richard Adams said...

As long as there are articles about McDonald's there will be click-bait headlines. At major publications the person who writes the article has little to do with the headline. That's a specialty. The headline writer scans the article and comes up with the most sensational angle. That started hundreds of years ago in newspapers and is now what pays for the operation of websites.

By the way, Joe Cahill is not a reporter, he's a columnist and there's always a little of his personal opinion in his work.

Anonymous said...

Strong Arm Tactics will not work this time. There is too many willing to band together. I expect to see at least 1200 operators in Dallas. A number of the items that Easterbrook has done was very munch needed like Cutting Budgets and Staff. However the relationship damage that was caused by Chris K. and Team is unforgivable.

The systematic destroying all of our history by Both men is unacceptable. Ronald the most recognized Corporate Icon in the world, replacing Oakbrook with a White Elephant and making the Decor packages unfriendly to children and cheap looking.


However our Big Challenge as an Association will be to move past the Complaining or Venting stage to the Action stage. No of us are Revolting on the Contrary we are more passionate about our Brand than anyone.

My Wants as an Operator
1). Give an Operating system we can successfully execute.
2). Help me Achieve a responseabile ROI.
3). Help me Develop a Value platform right for my area of the Country.

This is ALL I have ever wanted.

Anonymous said...

"Rumor has it that Easterbrook is livid over the groups formation and frets about its effect on the stock price. Supposedly, Chris K is urging strong armed confrontation to neuter the group."


Strong armed confrontation has already neutered operators... that is why this organization is being pursued to begin with. as a wise man once said, it is better to have big balls, than small balls.... or no balls." -- confucius

Anonymous said...

With all this press why does the stock price keep going up? Until that’s changed I don’t think we will be able to make change happen. I think this is association is great, but I too am concerned on where do we go from here. I will be in Dallas to see. Because as everyone sees, everything we do is not improving our business. We can’t confuse motion with progress. Chris K was a retail guy (look at Aquafina which is what he ran). Bottled packaging is about having SKUs out there. McDonalds is not about cramming stuff in the restaurant and hope it’s purchased.

Richard Adams said...


I would caution everyone to avoid paying too much attention to McDonald's share price. There are just too many variables that go into the share price to think that activity on the part of McDonald's franchisees is going to be immediately reflected in the stock.

Seventy percent of McDonald's shares are held by institutions and these institutions move slowly and methodically. I don't see anyone at the Vanguard Group saying "McDonald's franchisees are unhappy - reduce our position by 30 million shares".

While it might be shocking to McDonald's Operators that "Operator Only" meetings are happening it's not going to impress shareholders. I'd guess that if we were able to survey shareholders and institutional decision makers most would be surprised that there wasn't already an independent franchisee group in McDonald's.

Long-term, investors would be concerned if there were changes to such things as the McDonald's remodel/rebuild policy. Investors feel like they own those buildings and they love having Operators pay for the improvements. Shareholders also count on franchisees to continue supporting OPNAD

In the end this is all about earnings. McDonald's investors will give lip service to good franchisee morale but in truth, they aren't all that concerned. As far as they know McDonald's can always get new franchisees. In other words, they have the same attitude as the people running McDonald's Corporation.

Don't use McDonald's share price as a barometer of your success.
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Anonymous said...

Can someone tell us the site of the meeting so we can make hotel & flight plans?

NONE OF US IS AS GOOD AS ALL OF US. RAY KROC

remember that Steve & Cris

Richard Adams said...

Go to the NOA website, click on "register" in the upper right corner. It's all there.
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Anonymous said...

Keep in mind that it is your credit worthiness that MCD uses to improve their own assets. You borrow money based on your ability to repay it. That money is then used to improve company assets. If you go broke doing it the bank has no recourse to MCD. It is you that is on the hook. Once you take that risk and improve company assets MCD has no problem with impacting your store, forcing deep discounting, offering no guarantee of rewrite or expanding with you. They take the position that we are just lucky to be in the system and have nothing more to offer except our individual credit. Regional managers make decisions based on if they like you or some other irrelevant reason. Most have never done anything in life except get a mortgage on their house and they think they know what it's like to borrow millions of dollars then give it to MCD. Some are good administrators but none are business people. In the past it was the trust between the operators and MCD that made us strong. That trust has been eroded and MCD doesn't care if you can afford things or not. If you can't afford it then get out. It is becoming a matter of survival and if we don't take care of ourselves no one else will.

Anonymous said...

Richard is correct about the stock price being mostly irrelevant to franchisees organizing and fixing their unit level business models. Shareholders know that all operators are tenants and that they have their royalties, rent and marketing cash taken from their bank accounts automatically. The cash flow keeps coming to MCD to fund buybacks and dividends. That's all that they care about, so focus on your primary objectives without regard to the stock price.

Forming an independent association of OWNERS, not "operators," may even be supporting the shareholder recognition that the stores need to improve business at the unit level and owners taking the responsibility to do that is something that shareholders get for free. A whole group of experienced restauraneurs that MCD! doesn't have to pay a salary are suddenly getting to work.

Anonymous said...

Thank you Richard for weighing in on Stock price, you're Right that it shouldn't be the big Target we keep our eyes on. I have heard the same rumors about Chris and I know there are some Emails circulating about what He wants to do about NOA. I don't know about 'armed confrontation' but I have Heard he is getting ready to take action.

Richard Adams said...

Send some copies of those E-mails to: adams@fegroup.com
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Anonymous said...

http://nationalownersassociation.com/videos/?utm_source=National+Owners+Association&utm_campaign=4323dc012d-EMAIL_CAMPAIGN_2018_10_19_02_01_COPY_03&utm_medium=email&utm_term=0_84fda4f3eb-4323dc012d-59637457&mc_cid=4323dc012d&mc_eid=fec5a49d45

Anonymous said...

It is IMPERATIVE that EVERY owner sign the NOA Commitment Pledge.

http://nationalownersassociation.com/commitment/


The time is NOW