Name: McDonald's Wrote a Startling Letter That Should Really Worry Customers | Inc.com
Brand: inc.com
SKU: inc-com-5
Availability: OnlineOnly

critic

McDonald's Wrote a Startling Letter That Should Really Worry Customers | Inc.com

preview

&nbsp;usually looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek.&nbsp;We're all in this together.Such is a popular mantra currently.&nbsp;If your business is going to survive these torrid times of Coronavirus, every hand on deck should be propelling the ship forward.Some business models may be more vulnerable to friction in the bad times.McDonald's has had enormous success with its franchise model. However, as the company got bigger it began to move more slowly. Change was glacial. Which, when you have so many sprightly competitors, allows them to feel more current and more innovative.In the last couple of years, McDonald's has desperately tried to catch up. It's introduced . Last year, it started trying&nbsp;.But when you have a franchise model, you really need the emotional and financial commitment of your franchisees.&nbsp;In this, McDonald's hasn't entirely succeeded.Its franchisees have regularly spilled their complaints into the media. They were , they said. They .They really, really wanted something to compete with 's&nbsp;premium chicken sandwiches.And they really, really didn't want to pay too much for the modernizing upgrades that McDonald's desperately wanted -- and, frankly, needed.With the arrival of the Coronavirus, McDonald's and its franchisees are fighting again. This time, it appears truly ugly.Clearly, shelter-in-place and social distancing has affected all fast food restaurants. But at least they have active drive-thru and delivery options.Yet, as sales have fallen, the franchisees are looking to McDonald's for help. Here's a sample of a communication sent to McDonald's by the&nbsp;National Owners Association -- which claims to represent 1,300 franchise owners --&nbsp;:&nbsp;Our membership and most owners are increasingly losing faith in the partnership and company leadership.So not only the 1,300 but "most owners"?The issue, unsurprisingly, revolves around increased measures to ensure&nbsp;the safety of employees, as the virus spreads around America. And, well, who's going to pay for increased measures.McDonald's seems to believe that franchisees view it as an eternal piggy bank.Which led to McDonald's U.S. head Joe Erlinger writing back to the NOA:&nbsp;If that's how the NOA seeks to define its relationship with McDonald's, then in reality, we don't have a relationship, and I am extremely disappointed and disheartened by this.Of course a franchise business often sees tensions between the parent company and the franchisees.And McDonald's insists there's nothing untoward in its franchisee relations.The tone of these communications, though, suggests a truly unpleasant schism. When things get this bad, how can you possibly work together effectively?What, you might say, does this matter to customers?If your business is characterized by poor internal relations, customers are likely to feel it. Employees are more likely to badmouth the company because they have no emotional investment in it. Managers are more likely to go through motions, rather than hell or high water.Worse, when there are sales initiatives -- crucial to the fast-food business --&nbsp;franchisees and employees may execute them in a half-hearted way, if they don't really like them.I'm not suggesting that only happy companies make their customers happy.However, if McDonald's and its franchisees can't agree on the very basics of doing business -- especially at a time like this -- how can customers expect a brand experience that encourages them to come back again, or even more often?And if they have a bad brand experience, well, they have plenty of choices. Often, right next door.

&nbsp;usually looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek.&nbsp;We're all in this together.Such is a popular mantra currently.&nbsp;If your business is going to survive these torrid times of Coronavirus, every hand on deck should be propelling the ship forward.Some business models may be more vulnerable to friction in the bad times.McDonald's has had enormous success with its franchise model. However, as the company got bigger it began to move more slowly. Change was glacial. Which, when you have so many sprightly competitors, allows them to feel...

public

Chris Matyszczyk

ChrisMatyszczyk

Inc. is an American business magazine founded in 1979 and based in New York City. It publishes eight print issues annually, as well as daily online articles and videos. Published by Mansueto Ventures. Inc. is best known for its annual rankings of the fastest-growing privately held companies in the United States, called the "Inc. 500" and "Inc. 5000."

McDonald's Wrote a Startling Letter That Should Really Worry Customers | Inc.com

No article scores yet.

CRITIC REVIEWS

PUBLIC REVIEWS