Specialist
Former senior director at McDonald's Corp
Agenda
- QSR industry dynamics, focusing on McDonald’s (NYSE: MCD)
- International pressures – Russian market withdrawal, challenges in China and supply chain difficulties
- Accelerating the Arches growth strategy merits and drawbacks
- Technology investments and potential gaps
- Leadership strategy and potential franchisee friction
Questions
1.
Could you open by sharing your outlook on McDonald’s for the remainder of 2022?
2.
How might McDonald’s be thinking about infilling lost revenues from its withdrawal from Russia and closures in Ukraine, which you estimated at around 10%?
3.
As it looks to lean more on the US, how long will McDonald’s take to make up that 10% of revenue contribution lost from the Russia-Ukraine conflict?
4.
Can you expand on your thoughts regarding China’s longer-term feasibility for the company?
5.
Would you say the McDonald’s relationships with regulators or governing bodies in China have become more constructive over the last few years or has friction been growing with those parties?
6.
If McDonald’s were to look at doubling down in China, whose playbook might it take a page out of? Are there any examples of comparable foreign QSR players that have successfully grown in the region?
7.
Excluding the leadership succession and partnership challenges, are there any others worth flagging when it comes to China?
8.
Is McDonald’s in any way advantaged when it comes to US supply chain vs its peers in the region?
9.
When do you expect players to get relief, or some semblance of normality on supply chain in the US?
10.
What are your views regarding McDonald’s hiring hourly labour to fulfil demand? Any thoughts on where that sits today for them?
11.
You mentioned working at McDonald’s being America’s best first job in the past – has anyone overtaken it in that role?
12.
Do you have any perspective on wage inflation in the US? What are some potential actions McDonald’s can take to address wage inflation pressures?
13.
What are your thoughts on the merits and drawbacks of McDonald’s’ new Accelerating the Arches framework?
14.
Do you believe that the Accelerating the Arches framework has more buy-in than pushback from franchisees, given some of the potential implied investments as a part of the strategy? For instance, you mentioned three Ds – digital, delivery and drive-through – as one of its pillars.
15.
A report estimated that nearly one-third of orders are coming through digital channels. How do you see that evolving longer term?
16.
You mentioned that McDonald’s has been a bit slow to digitise. Was that in the context of alternative currencies or digitisation when it came to investments in digital, as we know it in the three Ds?
17.
What are your thoughts on the McDonald’s technology investments broadly or longer-term? How does it compare to competitors when it comes to tech and the progress of what you’ve seen come from the Accelerating the Arches framework?
18.
Which of McDonald’s’ competitors might be ahead of the technology curve?
19.
How would you respond to those who believe McDonald’s may have over-invested in technology and under-delivered for its franchisees?
20.
A recent industry survey revealed franchisees were upset with McDonald’s management over new changes to ownership rules, which I believe will increase standards for the renewal of franchise agreements. What are your thoughts on the changes and the decision to implement them without getting buy-in from operator leadership first?
21.
Is forced change culturally ingrained in McDonald’s or is that coming from specific leaders of the broader franchise?
22.
What could be done to alleviate franchisee friction with McDonald’s corporate?
23.
What is your perspective on the McDonald’s menu relevance and pricing strategy? What actions could be taken there? Should anything be kept top-of-mind as consumers potentially become more cost-conscious in an economic downturn?
24.
What might keep you up at night and what would you be excited for if you owned 100% of McDonald’s?
