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Log In / Register | Jun 22, 2018

Franchisee Association, Owner Relations Crucial to McDonald's Leader

McDonald's president of U.S. operations, Don Thompson, has let franchisees help point the way for a major win, the double cheeseburger. Now he uses the same focus on franchisee relations to help point the company in the right direction with its  McCafe drink blitz.

Franchisee relations are critical for McDonald’s, and Thompson gets high marks from Don Armstrong, head of the national association that represents McDonald’s owner-operators. “Don’s been a great partner,” he said. “He has a great rapport with the franchisees.” Thompson said he spends at least 70 percent of his time meeting with franchisee organizations or individual franchisees, crisscrossing the country. Even when he’s on personal time with his wife and two children, now 12 and 15, he often stops at McDonald’s outlets just to check up on things.

Notice how Thompson uses franchisee debates to help inform and point the company successfully to new directions.

McDonald's found itself under intense pressure from franchisees to raise the price of the double cheeseburger, the anchor of its dollar menu. Franchisees, who run about 85 percent of the firm's roughly 14,000 U.S. restaurants, were increasingly having trouble making money on it as ingredient costs spiked. The conundrum, said Thompson: "It's a very tough economy and customers are looking for value, so the last thing you want to do is raise a price." The solution, one hotly debated by franchisees and company executives, was to offset a price hike on the classic double cheese by creating the McDouble, a $1 double burger with one fewer slice of cheese. "It was a huge decision," Thompson said. But analysts and company executives all say it's been a success since implemented in December: McDonald's hasn't lost customers or cheeseburger sales. - Chicago Tribune


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Don Sniegowski is editor of Blue MauMau, the daily news journal for franchise & small business owners. Call him at +1 (270) 321-1268, tweet @bluemaumau or email