If every McDonald’s is supposed to be the same, why are so many so bad (or good)?
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If every McDonald’s is supposed to be the same, why are so many so bad (or good)?
By Andrew Thompson
Halfway through the 2016 film The Founder , there’s a scene in which McDonald’s venal CEO, Ray Kroc (played by Michael Keaton), tracks down a franchisee on a golf course. Kroc has just discovered that this man’s McDonald’s franchise has drifted away from Kroc’s vision of McDonald’s as “the new American church” and has instead fallen into a derelict hangout for greasers, filled with litter—and, worst of all, that lettuce was somehow finding its way into the hamburgers. The irritated franchisee, who had been talked into opening a McDonald’s as an easy, hands-off investment, balks at Kroc’s micromanagement. “You said this would be a good place to park our money,” he tells Kroc.?
The depiction of a frustrated Kroc, who walks away while flipping off his insubordinate franchisee, begins to provide an answer to a question that nags at every fast-food customer—and intrigues us at Fast Company: How is it possible for a McDonald’s to be good or bad? Isn’t McDonald’s just McDonald’s? As we looked into this further, compiling a list of the best and worst reviewed locations of McDonald’s , Burger King , Taco Bell , and KFC nationwide, we found a host of factors that contribute to restaurant variability.
Fast-food franchises implicitly promise a uniform experience across stores, but the reality is that there’s an important intermediary between brand and consumer: the franchise owner. How those owners operate their locations can have significant effects on their restaurants’ performance.
“Some people say, I want to write a check [to open a franchise], and it’ll pay for itself,” says Kenny Rose, CEO of FranShares. The franchisee in The Founder is an example of this, an owner who expects a franchise to function like a bond, generating returns with no need for direct operational oversight. “But you’ve got other people who are owner-operators,” Rose says, who “are really hands-on. It’s very, very different there.”?
The approach a franchisee takes at one store is likely to carry over to the rest of their restaurant portfolio. A Fast Company analysis of McDonald’s locations, for example, found that franchisees with at least one restaurant in the top 25% of scores on Google Maps reviews commanded an high average score of 3.76 for all their other locations, while franchisees with a restaurant in the bottom 25% averaged a low score of 3.40 across their other restaurants. While that might not seem like a big difference, it’s more than one standard deviation. The franchise owner is what separates a good McDonald’s from a bad one.?
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The notion that closing the gap between ownership and operation results in a better working environment and higher customer satisfaction is perhaps best exemplified by Chick-fil-A, which emerged as the highest-scoring brand overall of 15 fast-food brands analyzed by Fast Company, with a national average review score of 4.34. With most fast-food chains, raising the capital minimum is the main hurdle toward ownership. But Chick-fil-A famously prefers its operators to have worked in a Chick-fil-A location for years before applying to open their own store, and then requires the operator to live nearby and be present at the restaurant. One is always, on some level, an employee first.
On the extreme opposite end of the owner-operator spectrum are private equity-owned franchise holdings. Determining which locations are owned by private equity firms is not straightforward (and therefore can’t be associated with a particular average Google Maps review score). But typically, says Rose, “private equity is known for we’re gonna buy things, strip costs, and sell them for more later on”—the antithesis of the emotionally invested owner-operator.
But detached ownership doesn’t necessarily equate to worse financial performance. On the contrary, says David Stiles, managing director at Citizens M&A Advisory, there is “lots of correlation” between the number of locations an owner manages and their revenues. So, just because a certain restaurant may be poorly reviewed doesn’t mean it isn’t profitable.
And then there are the factors that extend beyond ownership. “We know really old and stale [locations] get poor ranks and newer restaurants score higher,” says Stiles. “A brand-new Taco bell . . . probably gets a lot more applications for employment,” and those employees might be incentivized to keep a new facility clean and running smoothly.?
Of course, there are always exceptions to any rule: The worst McDonald’s in America opened just this year.?
Explore fast food chain highs and lows by clicking on each image below:
Isn’t McDonald’s just McDonald’s? Not according to these reviews.
The top five Burger King locations in the country are in Texas and Florida. South Carolina is home to two of the most loathed locations, according to our analysis.
Our analysis of the five best and worst Taco Bell locations in America excludes Taco Bell Cantina restaurants.
All the highest rated KFCs are in the Midwest or South, and the worst are west of the Mississippi.
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