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October 29, 2019

Nightmare on Carpenter Street

Yes, last week was a rough one for McDonald's investors. I don't know what's going to happen with McDonald's share price but I can predict what the corporate suits are doing this week. They're in a panic to accelerate several initiatives.

Many Wall Street types and most in the business media are blaming the soft traffic numbers for McDonald's USA on two things.

1) The chicken sandwich wars (about to be amplified by Popeye's).

2) Lack of McDonald's fake meat products. Just because many other chains are adding fake meat sandwiches and the like it appears to be a national trend. It's not, but that's what's being reported.

So, McDonald's management will be expected to jump on these two bandwagons with both feet. Their deadline is the third week in January which will be the next quarterly earnings release and conference call with analysts. Management will be expected to report substantial progress on chicken sandwiches and fake meat.

And that's why we'll see management panicking. They have about eleven weeks to work their magic.

Unless of course,  McDonald's USA turns in some spectacular sales in November and December. If so management will be temporarily off the hook but will still be pressured on the above initiatives.

Meatless meat backlash - Vox

McDonald's expected to jump into chicken sandwich war next year - Marketwatch

Canadian fake meat hasn't been a blowout - Marketwatch

11 comments:

Anonymous said...

On a chicken sandwich, the NOA has been asking to launch one. Perhaps someone in Chicago could have listened sooner to the operators instead of waiting to take orders from some number crunchers in cubicles.

On meatless burgers, I suspect that BK has an exclusive so MCD will have to hunt for another supplier that could meet its volume. Beyond may be too small to supply McDonalds so far even though a former MCD exec runs it..

Anonymous said...

They wont blame it on chicken or meatless, they will blame it on the NOA and make the effort to divide operators. They already started. Winter is Coming.

Richard Adams said...

They may do that internally but publicly management will continue to claim they are in complete "alignment" with the franchisees. And they won't bad-mouth NOA, at least not publicly.
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Anonymous said...

Can we not let ALL the other mindless companies sell this Fake Meat?

1) it is highly processed
2) it is not healthy
3) Heavy Sodium
4) it takes our focus away from our main business of selling real food.
5) what happens when someone complains about meat juice touched my fake meat patty?
6) we have gone this route before, “McLean Deluxe” (what dry hole)

Finally, This is a FAD, that means it will be around a little while and then something new will come along.

Anonymous said...

NOA has to batten the hatches and keep operators united despite the pressure. Always remember, NOA members are here for life, the suits are hired help and will move on to the next financial engineering cash grab at another company, with the Golden Arches on their resume.

Whatever threats they make go up in a puff of smoke if NOA can hold the line to protect owners after management is forced out.

Adopting strategies that other franchise owners have used successfully in the face of management intimidation will be critical.

Anonymous said...

Internally is how they hatch best.. owners need to create a death switch and report system to put it at bay... or they will be steamrolled into oblivion

Anonymous said...

All operators need to be aware that using the partners email system is not secure. MCD owns it,and controls its access. Be aware!

Anonymous said...

interesting about partners mail. do you think they can "geo-fence" operators too? as in track them and pick and choose who they like based on how much time is spent in the store??

Anonymous said...

To the comment above.

I would not put it past them to geo-fence you or your cell phone!


MMGA

Join the NOA

Anonymous said...

Before the pajama boys blame Operators for the stock price decline, they (MCD) need to look in the mirror. They foolishly BORROWED money to buyback millions in MCD shares in an attempt to buoy the price. Top management does not have the courage to admit what they do not know (operations). De-emphasized and defunded LSM and local marketing during a TC decline! So environmentally PC that we stopped seeking/using products that protect our product quality and portability (Styrofoam, plastic straws, etc.). Killed off Ronald, the second most recognizable Icon in the world. Lost the American values of competition between suppliers to obtain better prices, quality, service and innovation. Obsessed with "Modern and Progressive". Our one size fits all approach has made the McDonalds experience cold and sterile. Cut off the Operator leg of the vaunted "three legged stool". For these and many more reasons, MCD execs have no one to blame but THEMSELVES.

Richard Adams said...

"One size fits all" is one way to put it. But what you've summarized is an effort to get total, centralized control over the domestic McDonald's system. The complete opposite of capitalism and entrepreneurship. Just what you'd expect from a bunch of bean counters who don't understand the McDonald's business - or any business.
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