June 30, 2022
From Attorney Carmen Caruso''s Facebook
Carmen Caruso 6/30/2022
Sounds an awful lot like an attempt at intentionally intimidating dissenting voices. “Rewrite” at Mcdonald's has always been discretionary and there have always been, and always will be, disagreements as to whether the discretion is or was improperly abused in any given case. So, the company is not changing the contractual framework, but rather, it has announced it will “raise the bar” under the existing contractual framework. Why? And why now? Is the company admitting that it has made bad rewrite decisions leading to a proliferation of poorly run restaurants it now regrets? Not likely. Or is the company trying to stifle dissent by franchisees to the company’s direction in recent years? Far more likely. Kudos to the NBMOA for its courage in voting “no confidence” in the current regime.
https://www.facebook.com/carmen.caruso.law
June 29, 2022
June 28, 2022
June 27, 2022
Don't Let McManagement Lie About Rewrites
Just before the turn of the century, a guy named Jack Greenberg was CEO and Chairman of McDonald's Corp. He was NOT doing well and his many initiatives to "reinvent" McDonald's had failed terribly. His solution was to go on the investor conference calls and blame everything on the Owner/Operators. He and his team claimed that McDonald's restaurants had never been inspected or supervised by the corporation. There were no standards, no formal inspection process, and he was going to start one.
That was a surprise to McDonald's veterans. In truth, there had been an inspection program in place in the USA since the early 1970s so Greenberg was lying about nearly 30 years of history. I know because I was one of those doing those inspections and I was subjected to them as a franchisee.
We'll see how this develops but as of this past weekend, it appears that management might be taking the same "those lazy franchisees" approach. The implication is that getting a rewrite has been automatic and no standards were set or applied. We obtained our rewrites by just breathing.
This is another attempt to move the blame for anything that goes wrong onto the Owner/Operators. Then the pajama boys can move in and show the McDonald's system how to run a restaurant chain.
June 21, 2022
Having Greatness Thrust Upon You
So, a Chicago suit wants McDonald's Owner/Operators to aim to be greater? And he figures if his letter writer pulls up the name of Ray Kroc that McDonald's Owner/Operators will sit up and pay attention.
Well, I can do that too. After all, I actually knew Ray Kroc - Ray Kroc hollered at me.
Mr. Kroc wrote in his first book that when he was growing up his family nicknamed him "Danny Dreamer" because he was always lost in thought.
In several regards, McDonald's Owner/Operators also live in a dream world.
There's the dream world where it's a good idea to spend millions on your landlord's building to infinity and beyond.
There's also the dream world where it's a good idea to keep pouring money into a chasm called OPNAD when the rest of the world knows local control is best in businesses and government.
With that in mind let's look at the four built points sent from the suit.
New Term - Rewrite has always been an inaccurate term. It was used to placate the Operators from the first MOA. In rewrite meetings of the day, the attorneys in the room would call the deal a "New Term" and the Operations guys would call it a "rewrite".
Separate New Term from Expandability - That's substantially been done over the past few years as the size of the average Operators grows. When a fifteen-store Operator absorbs a ten-store Operator are all of that buying Operator's stores up to date and expandable on their own? Of course not. This just formalizes it. It also gives corporate total control over who buys what stores(s).
And it means McDonald's USA is trending toward larger and larger Operators.
New Candidates - This can only be seen an effort to separate the Next Gen from the herd. I am blessed with many friends who are retired or nearly retired and who have kids in the McDonald's business You guessed it, there's a constant tug-of-war. The family wants the Next Gen to continue their education in the business. The corporate folks want the Next Gen to simply be an extension of the bureaucracy.
Values - This is where they get you - It only takes three or four sentences to get outside your franchise agreements and control your life from a woke state of mind where franchisees will march in step with their corporate brethren. To understand this better, scroll down to May 14th where we displayed a circular chart explaining Environmental, Social, and Governance.
When corporate management teams (execs and directors) get involved with ESG they tend to lose their minds.
Management gets distracted by priorities that have nothing to do with the business welfare and then ignores business threats that are right in front of them. So it will be with ESG.
June 17, 2022
June 15, 2022
June 14, 2022
Maze on Menu Inflation (Premium subscription)
"The recovery has largely come from higher prices, and probably more so than you might even imagine."
When sales increases are a product of price increases managments and investors show little concern about decreases in traffic. That's the typical short-term thinking that runs Wall Street.
Restaurants recover from the pandemic, but things are far from normal
June 13, 2022
June 12, 2022
Just Asking - Is McDonald's USA a Part of This Network?
Please respond by anonymous comments or email to: adams@fegroup.com
Secretary Pete Buttigieg
June 10, 2022
Is Drive-Thru-Only a Good Idea?
McDonald's veterans will remember "Mini-Macs" and other programs in an attempt to get small. And we all remember SPODS.
Fast Food restaurants do away with dining rooms - Jonathan Maze
This one is a little surprising. This Chick-fil-A is crammed into a corner in a strip mall but based on Google Earth it appears to have a full dining room and outdoor seating. It looks like they are going to trash all that and go to drive-thru only. Maybe they're building another full-size store nearby.
June 9, 2022
McDonald's Smaller Menu - If You Can Keep It
McDonald's Owner/Operators should still expect, when same store sales become more challenging, that the clones in Chicago will yield to pressure from analysts and ESG provocateurs to add things back to the menu, introduce new products, and do more LTOs.
June 7, 2022
June 5, 2022
Ray Kroc on Academia
Ray Kroc interviewed in his San Diego office
Five-minute video - watch to the end for all of Ray
McDonald's CEO on ESG
* This video interview posted by Duke University is an hour-long, far longer than any other video we've posted. If you have an interest in McDonald's it's well worth the time.
* This video is 13 months old so some things have changed since its filming.
* This interview is different in that the CEO is not talking to the press or investors but to his people, his brethren, his peeps. While much of this is the usual McSpin there's a lot of truth that never gets revealed elsewhere.
* Notice that he's a little obsessed with the conflict over styrofoam cups.
* Notice he wants the government to step in and stop Chick-fil-A from using styrofoam cups. This might be the first time a CEO has called for more government regulation of their industry.
* When you view this video pay attention to the interviewer, Dean Toddi Steelman. She appears to be a perfectly nice person but she's an environmental whacko teaching and training new generations of environmental whackos. Chris K. is her Superman, a corporate figure with the power to move her whacko dreams forward.
* Notice how they both sneer when talking about people from "the south".
* I may be on a learning curve with YouTube videos but when I test the link it opens a few minutes into the video. I suggest you click the link and then refresh the page to get all of the dialogue.
Chris K on styrofoam cups and more
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June 4, 2022
More on Environmental - Social - Governance
Admit it, when you page through a company's annual report you give the Chairperson's comments a quick scan but then you move on to the numbers. Me too. But the chairman's letter from the McDonald's 2021 annual report is worth a second look. The letter drips with political correctness, wokeness, and an obsession with ESG.
It's obvious McDonald's is being run by people who want to impress segments of the population that may or may not be stakeholders in McDonald's.
But this letter was obsolete before it was published. I assume that work on such a letter begins in the first months of the year and that the draft moves across the desks of many corporate departments. The trouble is, that by the time this report was made public wokeness and political correctness had begun to acquire a tarnished reputation climaxing with the disastrous Disney company controversy. And, in the last few months more and more Americans are learning about the cancer we call ESG.
The rest of this year will be very politically charged and when the mid-term elections are over the corporate types will be embarrassed to mutter the words "Environmental, Social, and Governance".
FOX News Laura Ingraham on ESG - Eight minutes of wisdom
Elon Musk calls ESG a "scam" - Washington Times
A link to the chairman's letter is HERE
You might have to scroll around - the letter is at the top of the page
