McDonald’s reopening plans face franchisees’ reluctance

Bloomberg

McDonald’s Corp is planning for fully reopened dining rooms in the US this summer, though it’s running into opposition from some franchisees who say they don’t have enough staff or interested diners to make it worthwhile.
The company said that while it isn’t setting a hard deadline for franchises, it’s aiming for a rolling re-opening between now and the end of August, as Covid-19 rates and local regulations allow.
Franchisees own about 95% of McDonald’s roughly 13,600 US locations, and the company said it plans to be flexible and work with individual owners on alternate plans when necessary. Only about 15% of customer dining areas were open as of last month, McDonald’s said.
Some franchisees say they want to reopen, especially after spending so much on recent renovations. Others are reluctant to bring back in-store dining. That’s because their restaurants are doing well already from drive-thrus, takeout and delivery, which can be operated with fewer staff.
Restaurants across the US have had a hard time finding workers, with McDonald’s recently announcing a wage hike at its company locations to entice employees.
Many diners aren’t demanding seating areas, either, with one-third of Americans still “definitely” avoiding eating out as of late April, according to industry researcher Datassential.
The world’s biggest restaurant company is often a bellwether for the fast-food industry, so its decision to bring back indoor dining could spark a
ripple effect in the US McDonald’s shares are up about 8% this year, fuelled by the strength of its drive-thru business and the launch of its new chicken sandwich.
While franchisees say there’s mounting pressure from corporate to reopen as the CDC relaxes guidelines an elected group of franchise leaders has said it will support store owners who aren’t ready to reopen their dining rooms.
McDonald’s moved to loosen some of its other restrictions, including letting vaccinated customers discard their face masks.