What Franchisees Are Saying About McDonald's Woes

'Are We Too Big to Grow?'

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McD's video series aims for transparency.
McD's video series aims for transparency.

There was little joy in McDonaldland last week as the Golden Arches turned in a weak third-quarter earnings performance marked by a 3.3% decline in U.S. same-store sales. Operating income for the quarter declined 10% as "initiatives to address the current market dynamics did not translate into improved financial results," the company said.

Its plan to address those conditions includes flattening the organization to make decisions faster; new marketing focused on food quality and transparency that has already begun with a series of YouTube videos; and simplifying the menu while making it customizable (read: more millennial friendly).

But its progress so far got low marks from franchises participating in a Janney Capital Markets survey conducted just before the earnings release. Here is a sampling of comments from the survey, released by Janney analyst Mark Kalinowski.

  • "McDonald's Corp. is scrambling to find answers to their problem."
  • "Business has just not been up to last year's numbers. McDonald's has not really changed anything in the kitchens or quality of products, or even the marketing approach."
  • "For McDonald's, it was once about location, location, location. Today it's leadership, leadership, leadership -- and we have none."
  • "Free coffee. Dollar menu. $2.99 Happy Meal. Idiotic marketing plan by corporate."
  • "Are we too big to grow? Maybe."
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