An April report by Franchise Consulting Group in partnership with VF Franchise Consulting titled “McDonald’s Model in Dying Days – 30% of Franchisees Insolvent” suggests some franchisees are insolvent and the McDonald’s business model of Ray Kroc may be in its end days.
Franchisees generate over 2/3rd of their revenues in the U.S. Franchise owners say the corporation is on a destructive path, and one 8-store franchisee just declared bankruptcy. Some 1,700 stores have changed hands in the last year, and some 2,000 stores are expected to close by the end of this calendar year. Franchisees operate 95% of McDonald’s locations in the U.S.
https://www.youtube.com/watch?v=qQkAXzil_9Y
In a financial survey by the Nomura Group, one McDonald’s franchisee stated the company is in the “throes of a deep depression, and nothing is changing” and that “probably 30 percent of operators are insolvent”.
Problems cited include pressure from government regulations, labor tensions, and financial losses are said to be to blame. The typical two most often mentioned are the cost of goods due to inflation of the last two years and the cost of labor due to higher minimum wages.
But these are not the only issues causing problems between McDonald’s corporate of Oak Brook, Illinois, and local franchise owners. Another April article in Restaurant Business Online offered:
The Investing Future report, “McDonald’s goes to battle over ‘joint employer’ rules—with its franchisees,” offered:
“McDonald’s once again was accused of being a heavy-handed “joint employer” of its franchisees’ employees. But this time, the accusations are coming not from labor groups but a group of the company’s own operators.
The Chicago-based burger giant’s ongoing dispute with its franchisees intensified this week over the level of control the company exerts on its operators’ businesses, this time with franchisees suggesting that some of its actions could qualify the company as a joint employer under potentially tightened regulations of the franchisee-franchisor relationship.
The result led to an intense week featuring warring statements between multiple groups of operators along with accusations of intimidation and threats and fears that the franchisee base has become divided.”
Another complaint franchisees have about McDonald’s corporate is that customer survey standards and new ownership requirements can hinder the operation of their stores.
Despite this apparent internal squabbling in the company between store owners and corporate, McDonald’s stock performance remains remarkably strong but this news story makes one wonder if this is not just the calm before the stock market storm so many are predicting these days.
OPINION:
Some people might consider me a lucky freak, but I consider myself blessed by God. As it turns out, I once ate at the first McDonald’s and was served personally by Ray Kroc. The McDonald’s #1 restaurant was built in Des Plaines, Illinois, and opened by Ray Kroc in April 1955. I met him some years later as a toddler as McDonald’s was getting all kinds of positive reviews in Chicagoland newspapers around 1958.
My meal was a burger, shake, and French fries, and it totaled out to less than 50 cents. We ate in our family car as there was no inside dining at that time.
McDonald’s has had a ton of “Bud Light moments” throughout its history, and it has overcome all of them. I remember when I was a teenager, and somebody leaked an internal document that McDonald’s was thinking of experimenting with using the meat of earthworms to supplement their beef patties. Boy, was that ever a premature Klaus Schwab moment for them!
McDonald’s is part of America’s heritage now, and I hope and pray they figure out a way through their current issues. Having a McDonald’s close-up shop is about as devastating to a community as losing a local Walmart… another piece of Americana.
Copyright © 2023 by Mark S. Schwendau
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Mark S. Schwendau is a retired technology professor who has always had a sideline in news-editorial writing where his byline has been, “Bringing little known news to people who simply want to know the truth.” He is a Christian conservative who God cast to be a realist. His website is www.IDrawIWrite.Tech.
Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
