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McDonald’s
Executive Summary
McDonald’s Corp, operates or licenses more than 30,450 fast-food restaurants in the U.S, Canada and overseas. Fifty eight percent of these stores are operated by franchisees, twenty eight by the company, and fourteen percent by affiliates. It’s partner brands include Boston Market, Chipotle and Donatos Pizzeria, which are all located primarily in the United States, and Aroma Cafe, located primarily in the United Kingdom. Foreign operations contribute around 51% of system wide sales and about 65% of operating profits. Its main source of income is through franchise fees. Under the conventional franchise arrangement, franchisees provide capital by initially investing in the equipment, signs, seating and decor of their restaurant businesses, and by reinvesting in the business over time. The Company shares the investment by generally owning or leasing the land and building. Franchisees in the United States generally have the option to own new restaurant buildings while leasing the land from the Company. Franchisees contribute to the Company's revenue stream through payment of rent and service fees based upon a percentage of sales, with specified minimum payments, along with initial fees. The conventional franchise arrangement typically lasts 20 years and franchising practices are generally consistent throughout the world. One of the companies major cost is advertising McDonald’s has had many successful marketing campaigns and has built it’s self a solid brand name. Evidence of this can be seen by the fact that (Business week) ranked McDonalds eighth in the world for brand name value. Business week figured that McDonalds brand value fo ...