March 9, 2019

News on McDelivery

A skilled negotiator knows to avoid making an initial offer that might be insulting to 
the other party. Best example - a home buyer making an extreme low-ball offer that is 
so far below the listing price that it insults the seller's judgment and their beloved
homestead.

That was my reaction to the proposed corporate rent caps on  McDelivery sales. It
will apply to so few stores that it's an insult to the intelligence of the Operator 
community. And there wasn't any real thought put into it. The majority of restaurants 
are still below 20 McDelivery orders a day so they just double that and make 40 orders
the starting point for rent relief?

At least it's a springboard point for discussion. I like the goal of making McDelivery transactions as profitable as drive-thru transactions. A stretch goal but a good one.

And it's also good to hear that OPNAD is holding off advertising McDelivery. Let Taco 
Bell waste their advertising dollars. 

This weekend's WS Journal contains an article about restaurant and grocery delivery. 
It's behind their paywall so you'll need a subscription to their website.


Here's a pull quote: "McDonald’s Corp. started using San Francisco-based Uber Eats
for delivery in January 2017. In a survey that a newly formed association of franchisees conducted of its members in January, 565 respondents said that delivery is not contributing positive net cash flow to the business, while 198 said it is.​"​

5 comments:

Anonymous said...

twenty orders a day, why would we even think about spending any advertising and promo on such folly. Spending money to lose money?

Anonymous said...

As I said, MCD management will do nothing to help operators on delivery economics. Their offer of a "rent cap" is nothing. It won't help me or anyone that I know.

It's an insult. They are just verifying that they think that we are their employees and dopes that are to be ordered around or pushed out of the system.

Anonymous said...

Like I have said in the Past, take the Rent & Service Fees Off the Delivery fee and we are good to go. This is an absurd cost to us, the owners.

This is just a Landlord being GREEDY. This Greed is blinding the McD. Leadership to where the REAL dollars lie. The real dollars are having 10k restaurants and 1,700 owners pushing this new avenue and Selling Billions Of Dollars worth of food, then in turn Rent & Service Fees rising to unprecedented levels.

Until a True Change happens with the Delivery fee for the betterment of the owner, McD. Delivery will always be an afterthought for the owners and ultimately the restaurants. Some will do well because of Volume, some will neutralize it’s effects by raising the cost of products and most will not push it to any extent allowing it to flounder and die.

Hopefully, McD. Leadership will wake up and awaken a Sleeping GIANT. This is a NO BRAINER!!!

Anonymous said...

The giant to MCD management isn't the franchise owners. It's Wall Street investors that prop up the stock price and this the value of their stock options that they routinely cash in by the million$$$.

They cannot just erase that rent and fee revenue from the balance sheet. They forecast it to Wall St and if they just give it away the stock price will take a big hit. They will not let that happen. There are a few things in life that you can be assured of. Follow the money incentives.

Anonymous said...

This is just the latest example that MCD (Easterbrook, Chris K, et al),DO NOT CARE ABOUT OPERATORS or Operator PROFITABILITY. Their ONLY concern is the Stock price, and their own multi million dollar Golden Parachutes!


Operators have ONE LAST HOPE - be a dues paying member of the NOA.