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Log In / Register | Apr 28, 2017

McDonald's Franchisees Fear Loss of Control

McDonald's, as part of its turnaround program, it says, wants franchisees to pay up for expensive upgrades and to cede control over menu discounts and deals. As might be expected, many of the franchise owners, who run over 90 percent of the brand's 14,000-plus U.S. restaurants, are riled over the proposed changes.

"Is this a corporate power play? There's no doubt about it," says Richard Adams, a consultant and former McDonald's franchisee. "Every franchised organization wants all of the major decisions made in the home office, no matter what they say. This is standard operating procedure."

…The shift in internal strategy comes on the tail end of a massive overhaul ​ of McDonald's corporate offices that has led to the departure of dozens of veteran executives and hundreds of employees. The list included the architect of the initiative to put more responsibility in the hands of the operators on the ground: former McDonald's U.S. President Mike Andres, who was shown the door at the end of 2016. Easterbrook's new team, led by Andres' replacement, Kraft Foods veteran Chris Kempczinski, has come in with new ideas. — Peter Frost, Crain's Chicago Business

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