AdAge Reports on McCafe Credit Crunch

A number of Owner/Operators qouted HERE

Some interesting discussion about when McCafe goes on OPNAD.

"My gut tells me that if McDonald's is counting on this for the second quarter, it's going to happen," another franchisee said. "They certainly have enough money and enough power to push their weight around."

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This is the Bloomberg Article That Started Things Percolating This Week

Owner/Operators will find a lot of information HERE

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Oak Brook: "There are no credit issues at McDonald's"

And it will have no impact on McCafe

Hum-hummm...

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Franchise Financing

McDonald's Operators in the USA should be watching for their
"partners" copy of a September 18 memo from McDonald's
Treasury Department concerning franchise financing..

Please do not let this memo get lost in your Monday morning
Inbox clutter.We suggest you share the information in the
memo with your appropriate advisers and consider how the
situation impacts CBB/McCafe in your stores.

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Expect Chipotle to Start Franchising.....

Chipotle Profit Hit By U.S. Economy, Food Costs

Time to start selling off some stores to franchised Operators.

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Tradition Can Be a Good Thing

Speaking of the history of McDonald's PR
and Advertising - one of the historical
disciplines that worked well was the
practice of not advertising new products
until nearly all the stores had the product.

But - with McCafe - Co-Ops are getting ready
to go on TV with 60% or less of the stores
serving the product!

We can only assume the same will apply to
OPNAD next year.

Aside from the customer dissatisfaction this
will cause - do the stores that do not have
McCafe yet - or will never have the drinks,
get to forgo their Co-Op contributions for
this period? Or, more doable, will there be
a Co-Op rebate for this waste of advertising?

I do however get a kick out the fact that if an
Owner/Operator isn't 100% on the Dollar Menu
they are harassed for damaging the consistency
of the brand. Yet, with McCafe, it will be OK to
disappoint 40% of the customers who have seen
the ads and are looking for the product.

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Retailing and Politics Don't Mix

When a major brand stubbles into an embarrassing
political mess it is possible to resolve the
situation and save face. Wal-Mart found a gracious
way out of their difficulties in 2006.

Wal-Mart press release is HERE

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SBUX Introduces Latest Breakfast Failure

Takes aim at McDonald's ... again...

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Jim Skinner from China

"The dollar menu has really driven 13 to 14 percent of our discounts. Seventy percent continues to be driven by core in the broad-based appeal of the menu, and the opportunities for the consumer to take advantage of the value across the menu continues to keep our margins in pretty good shape."

The Video Interview is HERE

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Chipotle Got The Smart People in the Spinoff

This Article discusses the trend to give away free
food during "tough economic times".

But as far as couponing:

"Arnold (a Chipotle spokesman) said discounts
condition customers to think that the food is
worth less than they would pay under normal
circumstances. It also encourages people to
come back only when discounts are offered."

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