For seven consecutive quarters, McDonald’s franchises in the US have been hemorrhaging money, and they’ve had it coming for a long time. Even before the modern health movement really picked up about a decade ago, McDonald’s food had become synonymous with garbage, and we’ve known for a long time that their products are downright harmful to human health. And for that, fast food companies like McDonald’s are almost as reviled as the tobacco companies, so it’s not surprising to find that they are losing their customers in droves.
And rather than correcting this problem with an obvious solution, like actually improving the quality of their food, the company has turned to marketing gimmicks like providing breakfast all day or the Create Your Taste program. Predictably, this hasn’t brought health conscious customers back to their stores. All they’ve succeeded in doing is alienating their franchise owners, as well as the customers who were still brave enough to endure their atrocious food.
For instance, their ‘breakfast all day’ initiative has turned into a chaotic mess. It has increased labor needs, caused equipment failures, and has slowed down the service time for a company whose only redeeming quality was the rapid delivery of food. This may not sound relevant, but keep in mind that all of this is rooted in the fact that people just don’t like their food anymore.
They’re losing money, and instead of improving the quality of their product and their service, they just keep attempting new marketing gimmicks until something sticks. That’s a classic sign that a company is in its death throes, and coincidentally, many of their franchise owners agree.
“We are in the throes of a deep depression, and nothing is changing,” a franchise owner wrote in response to a financial survey by Nomura Group. “Probably 30% of operators are insolvent.” One owner went as far as to speculate that McDonald’s is literally “facing its final days.”
Franchisees have also been complaining about the erratic nature of McDonald’s corporate decision-making process. As Business Insider reports, “The lack of consistent leadership from Oak Brook is frightening, we continue to jump from one failed initiative to another.” They are likely referring to the company’s many marketing schemes that have been implemented recently to slow the bleeding of younger customers as they choose healthier, more local options en masse. As Anti-Media also reported in June,
“Though the chain has dominated the fast food market for decades, recent competition and health consciousness has challenged the popularity of its product. The growth of chains like Chipotle, which recently stopped using genetically modified ingredients, has reportedly diverted customers away from McDonald’s. Additionally, the company is losing a share of its young patrons while the rise of boutique burger chains such as Five Guys has put a dent in profits.
McDonald’s financial floundering has sent a clear message across the food industry. There’s a new customer in town, and he wants real food that won’t kill him. And if you can’t or won’t deliver, you’re going out of business.