Ever since the CEO rolled out the BBV 2020, it has been controversial and rammed down the franchisees. While the pandemic may have pulled forward some important issues for the company, it did not solve the issues the company has with the franchisees. The following is a letter from Blake Casper, who help found the NOA. As you can see, MCD is still behaving in a way that is inconsistent with many franchisees.
Call with questions.
Howard
Dear Fellow Owners,
It was a busy week at McDonald’s, our hometown. We got a wake-up call regarding the nature of our relationship with McDonald’s. We talk collaboration; we talk about inclusivity, we talk about leading together, until McDonald’s acts unilaterally in their “own” interest. We say “own” and not “best” interest because we do not believe it’s in McDonald’s best interest to act unilaterally. It is not in McDonald’s best interest to disregard their partners, to dismiss us. We believe a healthy partnership with our Franchisor delivers the best results for all stakeholders. Presenting bills to be paid in full with no forewarning or back up information undermines the relationship. Eliminating rebates that have been in place for 40 years destroys trust. If you respect the partnership, you don’t unilaterally shift costs without a vote or say from your partner. If you believe in the three-legged stool, you want the other legs to do well too.
We don’t fault McDonald’s for looking out for their financial interest. They have shareholders (we are shareholders too) and are accountable to Wall Street. We also don’t fault McDonald’s for evaluating their expenses on a regular basis. We have to do the same. What we don’t do is decide arbitrarily what expenses we will pay for and what McDonald’s will pay for. We have neither the luxury, nor would our sense of fair play allow us to do so. We don’t get to pick and choose what staff we will employ for the business. In fact, our Franchisor gets to cut the staff they have supporting the business while we must make up the difference. There is also the issue of our recent planning process. We would not go through this exhaustive planning cycle withholding valuable information from our partner.
We appreciate and value the goodwill on our balance sheets. The balance sheets of all three legs of the stool. Accountants don’t place a lot of value on goodwill but for those of us in the relationship or people business, we do. We appreciate the acts of good faith that build good will. We appreciate what the company does that they do not have do. What is less clear is what we do that we are not legally bound to do. There are many things we are doing for no reason but for the good of the brand and the relationship. When our partner demonstrates they will be pursuing their own self-interest at our expense, all bets are off.
Your NOA Board.
