Coalition of Franchisee Associations

May 25, 2021

Owner to Owner

Enough copies of this came through by E-mail and as anonymous comments that I know it's legit. And we got many anonymous comments about the content.

We are back in the Headlines… 

I understand the challenges of servant Leadership, but I cannot stand silent while the process for which I and many others worked to establish is undermined.  We find ourselves in an environment that not only has degraded our relationship with the Company but is stifling dialogue and input from O/O.  

Do you know what made this company successful?  “We had principles when we were poor.”  A quote Ray Kroc often employed.  But even more powerful when offered to a McDonald’s manager in the Fairmont hotel in 1974.  The theme that year “Nothing recedes like success”. 

The recent news reports of a threatened lawsuit over the Tech Fee payments and encouragement to withhold support for the Board of Directors are the latest in a pattern of Leadership tactics that are dividing our brand and damaging the relationship with our Franchisor. 

The irony is not lost as these same leaders opine for the good old days and champion a culture of partnership and collaboration, paying homage to the Three-Legged stool, McFamily and personal access to corporate leaders.  

Demagoguing these principles is undermining our relationship and our ability to have honest and open dialogue.  Conversations are one way. Trust in the integrity of the process is undermined.  

Picking a fight with the Board of Directors doesn’t seem like the way to get their support. 

The “fight over Tech Fees” is a twisted attempt to embarrass the company and to avoid paying fees based on their billing mistake.  An audit is in process, but a personal review of P&L’s show less was paid during 2017 than was due then or in the previous year.  The Tech-board and Leadership had been briefed on the issue early on and then disavowed any knowledge when it became public. 

Integrity - “person of integrity displays a principled dedication to values and beliefs. They always seek to reflet ethical standards and do the right thing regardless of the circumstances.” 

Our integrity is at stake here. Do we take advantage, or do we do what is right?  

The Company made a mistake, should we take advantage of that, when we owe the money? Do you believe the company would go to these lengths if they weren’t obligated as a part of their fiduciary duty? The integrity of the company was staked on requesting this payment arrearage collection.  Ultimately the challenge to their integrity by leadership left no room for negotiation. 

The claims of 75% or 90% of Operator Support are statistical magic tricks.  75% of 225 respondents is only 168 out of 2100 Franchisees. The real damage is the misleading headlines and false claims of support marginalize the voice of the average Owner Operator.  

It further strains the credibility of this “fight” when the Leaders managed to get a carve out that exempts this arrearage from SBO’s to their benefit before the announcement was made. 

This is politics not leadership.  I have served with many great operators in leadership and on teams because collaboration improves our system. The Goal was always solutions that enable success for all legs of the stool. Our Operator Leadership organizations exercise influence not authority. The ability to influence has been powerful but that power is being squandered. 

As Franchisees we understand that the Franchisor has rules and policies that are integral to the business. We eagerly invest and vie for expansion.  Ray and Fred understood that franchisees engagement would benefit the brand. But make no mistake… they made the rules. 

What is the incentive for the Corporation to engage in collaboration when a political or legal battle hangs over the process?  If our influence is only to be exercised in the press or a courtroom the secret sauce of our business culture will be lost.  We lose and so does McDonald’s, falling back on our franchise agreements misses opportunities to partner for success. 

The Company contributed $100 million to launch Travis Scott and the celebrity trays.  Billions have been co-invested by the Company and Owner Operators in brand revitalization and partnering programs that our competitors’ envy and don’t even come close to emulating.  All a result of partnership and collaboration.  Take a look at their UFOC’s not a deal I want. 

Our success this year is unprecedented.  While other restauranters are fighting for survival our Leaders are fighting with the Company and throwing shade on our Brand. 

I will continue to work to influence our Franchisor to adopt policies that will benefit all legs of the stool.  I will do so with Integrity and adherence to the principles and culture that built this great Brand. 

Don’t be fooled into believing that your opinion is in the minority  Take a stand against these destructive tactics and encourage our leadership to get back to the business of collaboration.  

We have urgent and real issues that need the Corporation and Owner Operators working together to solve.  

“Nothing recedes like success” . 




Anonymous said...

Hard to believe this effort to poison tomorrow’s NOA webcast. However, it Helps spread the advocacy priorities. Owners reeling and bloodthirsty again on such pandering.

Don’t we wish NFLA had the support to get a Partners email so well-timed b4 any major Owner meeting, or without waiting 6 hours or negotiating words? Last NFLA system call was last lead in LWS email acting more in the know than elected leaders about the agenda

Anonymous said...

We have 1250 NOA members. They (Corp mgmt) are getting killed. On the night before all NOA webcast, the same way they worked to preempt the last NFLA CALL on NFLA ALL member webcast.
Nothing receives like so and so memory about he pandered his way to 25 stores. And ignoring the mountain of proof that the billing fees are illegitimate. What a tool! Total Corp
He ignores the facts that the NOA survey has exposed the low ratings of the BOD and the support of the companies policies. Owners have clearly expressed a vote of NO CONFIDENCE in upper management

Anonymous said...

LWS is the company newsletter heretofore unsigned ......
On the night before all NOA webcast, the same way they (LWS) worked to preempt last NFLA CALL with NFLA ALL member webcast.

Anonymous said...

It was the way to go in the begining, when simple negotiations failed... and MCD discussed an independent audit - then selected the auditor without operator input to the selections.

Anonymous said...

Absolutely. Mcd greed must be addressed. We need to make it hurt to get their attention. They are ignoring and dismissing us.

Anonymous said...

That email is a total farce! This is a BUSINESS, not a drum circle or a kids' soccer team.

IT IS ABOUT MAKING AS MUCH MONEY AS WE POSSIBLY CAN while abiding by the laws (and even influencing how they get made, when we can effectively lobby to do so).

Your feelings don't matter. Your free cash flow does. Singing Kumbaya with a hand in my pocket is not what I signed up for. Indeed, I signed my life away when I signed my first franchise agreement. The company? They lose nothing if I fail or am cheated out of my restaurants. Indeed, they make free money churning my business to another O/O while I get to keep all of the loans.

If I buy a share of MCD today all I can lose is $232. If I buy a franchise I and my family can lose EVERYTHING. The writer of this email tries to blur your vision of this simple fact that should ALWAYS be in the back of your mind when every business decision is made.

Anonymous said...

Embracing failure just because you want to sing a feel good song with corporate is what LWS is asking you to do by selling our fellow O/Os.

Why would you do that? This is a BUSINESS! Embrace success to your own bottom line.

If the profitability is there it makes all of the other problems MUCH less important.

LWS is telling you the the world stands still while you get exploited by corporate.

Our competition isn't doing sing-a-longs while we try to decipher the failed "business" strategies of corporate. They are going for our customers nd they aren't discounting like we are forced to do. If discounting so much is such a good strategy, why does it have to be hidden in multiple layers like loyalty on top of the app on top of the dollar menu on top of 1 2 3 etc etc etc?

Anonymous said...

LWS says:
Our success this year is unprecedented. While other restauranters are fighting for survival our Leaders are fighting with the Company and throwing shade on our Brand. "

O/Os made the success while corporate was holed up "safe at home." Their insane missives during the darkest days of the pandemic were smartly ignored while we shaped, changed and ran the business to astounding success. That tells you who should be in charge. Numbers don't lie, LWS does.

LWS says:
"I will continue to work to influence our Franchisor to adopt policies that will benefit all legs of the stool. I will do so with Integrity and adherence to the principles and culture that built this great Brand. "

Translation: Don't believe your lying eyes when you look at your P&L pre-pandemic and now. You didn't make all of that money after you were able to abandon all of corporate's ridiculous money wasting mandates. Believe the BS instead and lap up all of the woke corporate announcements that will drive our core consumers away. Spend more time embracing wokeness and corporatee servitude and less on making money.

LWS says:
"Throwing shade on our Brand."

Do they mean corporate jumping into every single social controversy that has nothing to do with burgers and fries for no reason? Because that is what throws shade on the Brand.

Anonymous said...

I wish Don A. would just shut up

Anonymous said...

My Question, if the debt of the technology fee was so obvious - why does it take several "audits" "months" to conduct to present an intelligent accounting of the event?

Does the IRS or some other third-party source need to be involved to measure this "integrity"? For it seems if the books aren't being cooked, why the delays? Accounting is a pretty straightforward process - and the amount would not only have to be OBVIOUS in the accounting - it HAD to be listed on the filed TAXES! Correct?

An accrual is an accrual - even in corporate McDonald's. It takes my accountant 3-5 minutes to trail an accrual on the books. Operators are being falsely misled that McDonald's needs 12-18 months to determine and justify the expense. The hope is that operators simply get tired of the fight, and "just pay it".

Pretty easy and obvious. Not even gonna begin discussing the meeting minutes and recordings of the Technology and National Leadership gatherings. There may be confusion in a member of a team, not the entire team.

You know stuff is crooked when a simple dispute is barred from the proper processes. Shameful, the dumb idiots blindingly trying to better their position off these situations. Whoever wrote that piece represents EVERYTHING that is wrong with the McDonald's brand today. More disgusting that it's a franchisee that believes being an operator is a good "part-time job".

Anonymous said...

How dumb to signify to the world that McDonald's Corporate can't CHEW GUM and WALK at the same time. Makes you fear if the brand can sustain a worldwide image. If it can't conduct a simple audit, gather collaboration of its franchisee force, and consistently move the brand forward.

Are they saying there needs to be a greater effort to finding competent corporate leadership capable of multitasking?

Did some corporate flunky actually sign off on that letter thinking its irrelative points strengthened their position? Not make them seem incompetent in the BILLION DOLLAR business world?