McDonald's Should Polish More Than Its Arches

NEW YORK - Making arches more golden is easy; making your workers more professional is hard.

That is the problem facing McDonald's, which has 30,000 restaurants and more than 360,000 employees around the world. Today, the Oak Brook, Ill.-based fast-food giant warned once again that it would see lower-than-expected profit. The world's biggest restaurant chain said it expects earnings of 38 cents to 39 cents per share in the third quarter, well below Wall Street's prediction of 42 cents per share, according to market research firm Thomson First Call.

In a press release today, McDonald's Chief Executive Jack Greenberg called the U.S. marketplace "extremely competitive." Indeed, the chain faces challenges from the higher-priced hamburgers of Wendy's and the cheaper fare of Burger King, not to mention the entrance of higher-quality brands offering "fast casual."

Greenberg outlined several initiatives to counter the challenging environment, all of them focused on the faltering U.S. market, which is responsible for 56% of the firm's total profit. He said McDonald's would pump between $300 million and $400 million into existing U.S. franchises next year, presumably to renovate certain restaurants and introduce new equipment.

The plan will be paid for in part by reducing new restaurant openings. McDonald's, which has reached saturation levels in several important markets, had planned to open up 1,400 new restaurants, according to a Morgan Stanley report. The report said that cutting new openings to 1,000 would do little to change total sales. What apparently gave investors more concern was that the company also said it would cut share buybacks to about $500 million from the $1 billion it spent last year. With stagnating sales, share repurchases have been one of the only things increasing the firm's earnings-per-share ratio in the past few years.

Greenberg said McDonald's will benefit from increased advertising of its $1 value menu. The move is a positive one, according to Morgan Stanley analyst Michael Sherrick. After all, the company needs to compete with Wendy's super value menu and Burger King's recently introduced 99-cent menu. In addition, cheaper items draw customers and result in order add-ons.

Though the franchise is right to upgrade skeletally by sprucing up existing restaurants and reducing prices, it is having a much harder time improving the blood and guts of the operation: its massive and far-flung staff. As Salomon Smith Barney analyst Mark Kalinowski said in a report last week, "We would love to see more details about how McDonald's will combat what we view as its key challenges in the U.S.: rude service, slow service, unprofessional employees and inaccurate service. In our opinion, what we have seen does not go far enough in addressing these issues, which together account for the vast majority of customer complaints in the U.S."

Until McDonald's comes up with a plan for upgrading service, warnings may be a quarterly event.

"Morally and ethically, you are correct. Economicaly, that is not the way the world works. Either be willing to pay $6 for you Big Mac, or deal with it. You can't change the nature of the free market."

I agree that lower wages attract lower quality employees, but...

""Approx. $6/hr. You try it, and let's see the attitude. You get what you pay for."

I interpreted the above to mean that if a person has a low wage job, it is license to treat customers badly and to not preform the tasks required of the job.

Fast food type work is not easy. But it's a whole lot easier than working on a roofing crew out in the sun for just a couple dollars more.

Not exactly on the fast food topic but service related never the less...

What's happened to RadioShack ?!?

You use to be able to go in and have a knowledgable conversation about electronics with the employees, most of them were ham radio operators, college students in a technical field etc. You could tell they enjoyed the job.

I've almost stopped shopping there in the last few years because the few times I went in to ask about a small part or radio component, some pimply face kid that looked like he was fresh out of high school would give me a dazed look and start into a pre-packaged sales pitch for a cell phone. When I pressed the issue they would wave their hand in the general direction of the back of store and try to get away from me as fast as possible.

McDonald's is a barometer of who & what we've become, as a nation.

When this slop seeps up to Boeing, Douglas, & General Dynamic Electric Boat, medicine -- & it's on its way as sure as God made little green apples -- we won't be safe no matter what the military does or doesn't do.

We are in the process of destroying ourselves quite efficiently; &, I'd dare say we're doing so much quicker than those who had the *power* & could've stopped this slide, those who should've known better, ever thought possible.
The decay's now taken on a life of its own like *rust*...it's literally become an outa control Frankenstein monster.

Well, what the hell.
We sure should at least be "feeling good about ourselves" as we go down the tubes, too; &, if not?
Then I'd have to say we've all been royally ripped-off by the forces who're directly to blame for the social quagmire.

Of course, to the poor SOB who's silly enough to point out the kimchee we're in, make a game attempt to explain *why*??
Well that person's certain to be instantaneously labeled a very "harsh person" & ignored, accordingly.
More often than not the *hit* will come from the very same people who're responsible for getting our society/culture into this stinking mess, too: The Liberal-Socialist factions on the Left.
Saddest of all, though?
If the Liberal-Socialists don't attack *first* in defending the societal fecal matter?
Then, the shameless smear will come by way of the insideously ambitious, unscrupulous dogs on the Right.

Why would both sides defend the indefensible?
For the only reason which makes any sense, of course.
No one gives a damn about honesty, truth, & what's best for this country anymore whatwith everything being thoroghly polluted by, "special interest(s)" of one kind or another?
(~thanks in large part to our two-term, illustrious, self gratifing Sink Emporer's pursuit of a *legacy* -- the demonic SOB...)

There's really very little left "united" about the United States of America in the wake of the greedy tsunami that animal left in Its wake save for plenty of slick marketing red, white & blue patriotism, slick albeit hollow images (ie, "An Army of ONE" >!< ), & plenty of jingoistic goobledegook.
~Form without substance.

Naturally, as fate would have it?
Having the ability to be honest with ourselves, be able to recognize *a* truth when [it's] in front of our faces is -- so help me God --the only way we can ever change the horrible cultural tailspin we're in & turn things around for the better.
That'd transformation would most certainly take a tremendous amount of WORK; &, are we really that much more ambitious these days?

Any bets on that kind of "change" happening in any of our lifetimes?

...such is our dilemma, neighbors.

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