McDonald’s has said it will restructure its business and increase its number of franchised restaurants globally.
The fast-food chain reported poor results for the first quarter of 2015. Chief executive Steve Easterbrook said he wanted to move away from its “cumbersome” structure and increase “digital engagement”. “The numbers don’t lie,” he said. “I will not shy away from the urgent need to reset this business… and how we galvanise competitive threats.”
Mr Easterbrook said the turnaround plan was aimed at creating a leaner management structure with more “hard-edged accountability” that was less built around geography and more on “commercial logic”. “In the last five years, the world has moved faster outside the business than inside,” he added. “We’re not on our game.
“We’d like less simple talk of millennials [people born between 1980 and the mid-2000s] as though they are one simple group with shared attitudes.”
The company also announced it would be focusing more on regions that earned McDonald’s the most – namely the US, which brings in 40% of operating income.
Mr Easterbrook also said its top international markets, such as Australia, Canada, France and the UK, would become a priority.
The firm also identified high-growth markets in countries such as China and Poland, where new stores will be opened to boost its share in the market of “IEO” – Informal Eating Out. Mr Easterbrook added: “We can no longer afford to carry legacy commitments, legacy structure or legacy attitudes.” McDonald’s was the Dow Jones share index’s biggest faller, with shares down 1.7% to $96.13. Standard & Poor’s, the credit ratings agency, cut its rating on McDonald’s from ‘A’ to ‘A-‘.