McDonald's faces franchisees decrying "Destructive Path"
Sadly the cartoon is funny but true.
Dont the stockholders see whats going on? The board? Chris , Joe and team are using short term strategies , detrimental to the brands future, to inflate the stock price before they bail out with their golden parachutes. But long term, they are destroying the most successful franchise system in history. Their actions will devalue stores and store equities, Destroy owner morale, and lead to the decline and eventual failure of the brand. Can you say “Howard Johnsons”?
The stockholders don't care because the stock price is high and the dividends keep coming and getting boosted. Most of MCD's debt are still lower interest bonds and they have international growth opportunities.They don't care that franchise owners are disgruntled. They will expect new franchise owners to simply take their place with MCD evicting them, stealing their businesses for free and reselling them to the new franchisees (or existing franchisees that are "good boys and girls"), keeping the sale price.It's the old franchisor playbook. Dunkin did it about 14 years ago. The franchisees there were only saved by their independent franchisee association DDIFO. They got the management team replaced when they became enough of an obstacle. This is why the NOA is the O/Os best chance to keep their businesses.
Post a Comment