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Richard Adams

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  • Don't Sell McDonald's Stock Because Of 2 Minimum Wage Myths [View article]
    Tom - there are 2300 (aprox.) individual MCD franchisees in the USA running some 13,000 plus restaurants so once in a while somebody will screw up. But, it's not an epidemic. The MCD franchise agreement says that the franchisee will comply with all laws, local and federal so if someone does screw up they are responsible for any penalties and usually end up leaving the McDonald's system. Also, keep in mind, unlike BKW & WEN and most other chains a MCD franchisee in the USA is likely a local business person who is well known in the communities they serve. If they were cheating their employees word would get around very fast and it would become tough to get help. And they'd lose a lot of customers.
    Mar 25 07:32 PM | Likes Like |Link to Comment
  • Don't Sell McDonald's Stock Because Of 2 Minimum Wage Myths [View article]
    Absolutely right John - franchisees can't be left to absorb every negative impact. If that's allowed the entire system suffers. Not only remodels slow down but marketing $$$ are squeezed, staffing is reduced hurting service,
    etc. etc. It's called a franchise "system for this reason.
    Mar 25 07:09 PM | Likes Like |Link to Comment
  • McDonald's: Americans Aren't 'Lovin' It' Like They Used To [View article]
    Good work on this article. Sales trends in the USA since the "Dollar Menu and More" tell us nothing because of the bad winter. Snow and ice have a huge impact on traffic and most of us are surprised that February wasn't down 3% or 4%. Everyone is making far too much of this millennial thing. Every generation is different but writers are acting like they are a new species of human. And the millennials are enjoying all the attention.
    Mar 12 06:43 PM | Likes Like |Link to Comment
  • McDonald's: The Present Scenario [View article]
    This writer is something of a drama queen. Frantically seeking top line growth can be very destructive for a chain that already has higher average unit volumes far above the other publicly held competitors.
    Mar 11 02:02 PM | Likes Like |Link to Comment
  • McDonald's: Business Model, Valuation And Minimum Wage Legislation [View article]
    The minimum wage was never meant to be a "living wage". It's a starting point or entry level. If the leftists (driven by the unions) get their way and make it a living wage and keep pushing it up the inflation will do great damage to the country.
    Feb 26 07:25 PM | 11 Likes Like |Link to Comment
  • McDonald's: Stick To The Basics [View article]
    <"Many franchisees in the U.S. have been hesitant to engage in remodeling costs involved with the McCafe strategies, which include buying expensive, $13,000 espresso machines.">

    This is completely untrue. There was some hesitation in 2008 but since 2009 every McDonald's in the USA that can have the McCafe area and the espresso machines has offered espresso drinks. You are absolutely correct that espresso doesn't sell. Franchisees tell me that they sell so few espresso drinks it doesn't pay for the electricity to keep the machine running all day.

    The five year espresso battle is over - Starbucks won. Investors should be angry when they see McDonald's wasting precious advertising dollars on espresso.
    Feb 12 05:14 PM | Likes Like |Link to Comment
  • McDonald's: Still Offering A Decent Upside Potential [View article]
    Investors should not look at the remodeling / rebuilding program at McDonald's as a guaranteed panacea. Remodeling and staying up to date has been a part of the McDonald's culture since the late 1960s. Therefore the current sales softness at McDonald's in the USA cannot be attributed to outdated facilities that turn off customers.

    I recently visited with a McDonald's franchisee who spent nearly a million dollars remodeling a McDonald's building that was built in 1995. Of course they changed the exterior to the new look, completely redid the dining room, upgraded the drive-thru, etc. The remodel was completed four months ago and aside from a modest blip the first two weeks the restaurant is showing a zero sales increase over last year. Why? The restaurant just didn't need to be remodeled. It was fine as it was.

    This is a far different situation than Burger King or Wendy's who have many run-down buildings and beat up dining rooms (especially Burger King). Remodeling those old stores would probably yield a sales increase. Whereas McDonald's franchisees have always kept their facilities up to date and comfortable.
    Feb 12 05:00 PM | 2 Likes Like |Link to Comment
  • McDonald's Needs To Fine-Tune Its Marketing [View article]
    RCG - as a franchise system McDonald's is kind of bipolar in that the franchisees, as small business owners, are politically conservative. The corporate people lean to the left, support Democrats, and relate to liberal causes. So, when a liberal group raises an issue the corporate people tend to overreact and take it too seriously.
    Feb 11 06:17 PM | 2 Likes Like |Link to Comment
  • McDonald's Needs To Fine-Tune Its Marketing [View article]
    Prices for the core menu are inflated because for 10 years franchisees could not adjust the prices on the Dollar Menu so they had to turn to the core menu.
    Feb 11 05:33 PM | Likes Like |Link to Comment
  • McDonald's Needs To Fine-Tune Its Marketing [View article]
    Right on Billyspeed, problem is the direction from corporate is more complexity, more customization, more choices for less customers.
    Feb 11 05:27 PM | 1 Like Like |Link to Comment
  • McDonald's Needs To Fine-Tune Its Marketing [View article]
    McDonald's in NYC is not indicative of anything about the McDonald's system.
    Feb 11 05:23 PM | Likes Like |Link to Comment
  • McDonald's Needs To Fine-Tune Its Marketing [View article]
    Sorry David but MCD is going in the other direction. Happy Meals continue to decline and most often when a McDonald's building is rebuilt or remodeled the playground is removed. McDonald's management is obsessed with Starbucks and other more upscale chains.
    Chuck E Cheese can have the kids.
    Feb 11 04:55 PM | Likes Like |Link to Comment
  • McDonald's: Industry Leader Faces Growing Pains [View article]
    From the article, "Menu innovation will continue to play an important role in MCD's SSS growth."

    No, menu growth and innovation is what's slowed sales growth at McDonald's. The menu is so large that, A) The restaurants are over-capacity and can't serve any more customers.
    B) New innovative products are no big deal with such a large menu. Why would consumers be excited by Mighty Wings with all the other chicken choices on the McDonald's menu?

    McDonald's will only grow when the menu is smaller and more efficient.
    Feb 3 11:35 AM | 1 Like Like |Link to Comment
  • McDonald's: Industry Leader Faces Growing Pains [View article]
    Moon - prices at MCD are distorted. Here's what happened - the Dollar Menu worked well at first but since it's a fixed price franchisees couldn't adjust for inflation over the years. They had to go to the rest of the menu to adjust prices. Sandwiches that should be $3.00 are now $4.00 or $5.00. That's what killed the Angus 1/3 Pounder, the price got so high no one bought them, instead they bought a bag full of $1.00 burgers for price of one Angus.
    Feb 3 11:30 AM | Likes Like |Link to Comment
  • McDonald's: Industry Leader Faces Growing Pains [View article]
    No, this management team is not "experts at fast food". Remember back 10 years ago when McDonald's bought up a half dozen other chains trying to grow through diversification. It didn't work and they sold them off to focus on the core brand.
    Feb 3 11:25 AM | 1 Like Like |Link to Comment
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