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McDonald's Plans To Close 200 US Restaurants This Year

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McDonald’s plans to close 200 US restaurants this year amid pandemic slump

by: Bill Shannon

Posted:  / Updated: 
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This Thursday, Oct. 17, 2019 photo shows the exterior of a McDonald’s restaurant in Mebane, N.C. McDonald’s reports financial earns on Tuesday, Oct. 22. (AP Photo/Gerry Broome)

 

(AP) – Business did improve for McDonald’s throughout the second quarter as restrictions lifted across the globe, but the fast-food giant faces a bumpy — and expensive — recovery.

McDonald’s President and CEO Chris Kempczinski said the coronavirus pandemic continues to cause uncertainty and depress consumer sentiment But he believes the April-June period will be the trough in the company’s performance.

“McDonald’s has learned to adjust our operations to this new environment,” Kempczkinski said Tuesday in a conference call with investors.

Of the chain’s 39,000 restaurants worldwide, 96% are now open, compared with 75% at the start of the second quarter. Comparable-store sales that were down 39% in April were down only 12% by June.

The recovery is uneven, however. In general, stores with drive-thru windows are recovering more quickly as customers try to limit contact, the company said. Restaurants in urban centers, malls and tourist locations are having a harder time.

In some markets, like Australia and Japan, sales are already running ahead of 2019. Australia has seen big increases in delivery orders, which now make up 10% of sales, the company said.

In China, the pace of improvement has slowed from the spring as consumers remain wary of eating out. Kempczkinski said he expects that pattern to extend into 2021.

In the U.S., McDonald’s put on the brakes. After reopening 2,000 dining rooms with reduced seating, the company paused reopenings in early July as coronavirus cases spiked. Last week, McDonald’s said it will delay dining room reopenings for at least another month and will require face masks for anyone entering its restaurants.

Still, U.S. same-store sales continued to improve throughout July and should end the month slightly positive compared to a year ago. Nearly all U.S. locations offer drive-thru, and McDonald’s said it’s also seeing an uptick in U.S. delivery orders.

In McDonald’s key European markets — France, Germany, and the U.K. — only two-thirds of restaurants offer drive-thru, and customers were more accustomed to ordering at the counter. That has slowed recovery. In the U.K., for example, restaurants were closed through May and dining rooms didn’t start reopening until this month.

McDonald’s is spending heavily to convince customers to come back, particularly for breakfast. The Chicago company spent more than $200 million to support franchisee marketing during the second quarter. It also paid $31 million to distribution centers — payments normally made by franchisees — and $45 million to cover franchisees’ debts.

McDonald’s said it expects to spend $200 million — on top of previously planned marketing — in the second half of the year on ads promoting core menu items and delivery and drive-thru.

The company said it will cut planned 2020 capital spending from $2.4 billion to $1.6 billion. As business resumes in the second half of the year, the company will help U.S. franchisees complete around 900 remodeling projects.

McDonald’s said it plans to close 200 U.S. restaurants this year, about half of which are low-volume locations in Walmart stores. The company is going ahead with the construction of 400 new restaurants in China.

McDonald’s said second-quarter net income fell 68% to $484 million. Earnings, adjusted for one-time items, were 66 cents per share, well short of the 74 cents Wall Street was looking for, according to a survey by FactSet.

Same-store sales fell 24% for the entire quarter, a point shy of analyst projections. In the U.S., McDonald’s biggest market, same-store sales fell 9%. Last year, they were up 8% in the same period. Same-store sales fell 41% in international markets.

Revenue fell 30% to $3.76 billion, slightly ahead of expectations.

McDonald’s shares fell 2% to $197.18 in morning trading.                                                                                                                                                                                           https://www.wearecentralpa.com/news/national-news/mcdonalds-plans-to-close-200-us-restaurants-this-year-amid-pandemic-slump/

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They should probably close the Brookville McD's.   That place cannot cook a burger to save their, or their customers' lives.    Almost completely pink on inside, which you do not do with ground meat.

Yeah, I love my steaks bloody - but burger is a different story for safety reasons.

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The management Company that bought the  area  local MCD's from Beatty's is average at best. The managers seem to be always be short handed workers and have to pick up the slack.  They shift workers from all 12 of their stores.   But, I do understand that they cant keep help long .  $9.50-$10 hour aint bad to pick up a few bucks. I can remember when I needed a few bucks and went to BK.  $4.75 hour at the time.. 

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2 hours ago, dubois_15801 said:

They should probably close the Brookville McD's.   That place cannot cook a burger to save their, or their customers' lives.    Almost completely pink on inside, which you do not do with ground meat.

Yeah, I love my steaks bloody - but burger is a different story for safety reasons.

Good location for another KFC.

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28 minutes ago, jaman said:

The management Company that bought the  area  local MCD's from Beatty's is average at best. The managers seem to be always be short handed workers and have to pick up the slack.  They shift workers from all 12 of their stores.   But, I do understand that they cant keep help long .  $9.50-$10 hour aint bad to pick up a few bucks. I can remember when I needed a few bucks and went to BK.  $4.75 hour at the time.. 

The Dubois MCD? I just txt my niece because she has worked there the past 2 yrs and she said they don't shift employees from other locations. She said she isn't sure where that info even came from. She said it would be quite the commute because the owners other McDonald's are all in NY. 

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I'm not a McDonald's lover, but every once and awhile I crave it and head to the one here in DuBois and have no complaints.  They always are super busy no matter what time you pass there.   The one in Philipsburg?  Nasty and disgusting, cold uncooked food.  I have complained about that one to the owners got a free meal coupin which I used in DuBois.  The one in Brockway is just as bad as Philipsburg 🤢


Life is what happens to you, when you're busy making other plans ~ John Lennon
 

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3 hours ago, Lyndsey33 said:

The Dubois MCD? I just txt my niece because she has worked there the past 2 yrs and she said they don't shift employees from other locations. She said she isn't sure where that info even came from. She said it would be quite the commute because the owners other McDonald's are all in NY. 

Not to get a manager in trouble, I was in my "local" Mcd's yesterday and she told me flat out. I over heard a discussion on staffing right in front of me while waiting..  I inquired about the staffing..    They are hiring.  They do a have a core group of regular employees that are very nice. 

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14 minutes ago, block said:

I'm not a McDonald's lover, but every once and awhile I crave it and head to the one here in DuBois and have no complaints.  They always are super busy no matter what time you pass there.   The one in Philipsburg?  Nasty and disgusting, cold uncooked food.  I have complained about that one to the owners got a free meal coupin which I used in DuBois.  The one in Brockway is just as bad as Philipsburg 🤢

I believe they might be owned by the same group. How do I know? They own like 12. And they have a computer screen near drive in which lists them. The screen keeps a running total of drive in customers at each unit they own in real time. Both of those McD's are listed on the screen.

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4 hours ago, jaman said:

Good location for another KFC.

We had a KFC right across the street from McD's.    Same person that owned the Clarion and DuBois franchises also owned the Brookville location.  ...and when he/she died in 2011 or 2012, the heirs didn't want to keep them. 

But yes, a KFC would fit nicely in there. ;)    Sure would beat e coli and salmonella poisoning.

 

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1 hour ago, jaman said:

I believe they might be owned by the same group. How do I know? They own like 12. And they have a computer screen near drive in which lists them. The screen keeps a running total of drive in customers at each unit they own in real time. Both of those McD's are listed on the screen.

The owner of the Dubois mcd is not the same owner of any of the other local ones including Phillipsburg.  The St Mary's Mcd is awful.

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I pretty much hate whenever we’re traveling and the kids want McDonalds. Now that they don’t have salads and their menu is super limited, there’s nothing good there. 

Wendy’s also limited their menu and they no longer sell Caesar or normal side salads. 
 

I wish Subways had more drive-thru restaurants. There are very few out there. At least at Subway, I can tell them exactly what I want in my salads. 

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DuBois has gone downhill.  Was there Wednesday and our order was so screwed up it wasn't funny.  Handed me a bag that had half our order and half something else and no fries at all.  I had to explain 4 times what was missing.  

Philipsburg ends up with a 10 minute for just coffee and they can't even get that right. Ordered with cream. They put sugar in it and no cream 🤦‍♀️

I think it is time to roll back America on the convenience.

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9 minutes ago, allboys said:

DuBois has gone downhill.  Was there Wednesday and our order was so screwed up it wasn't funny.  Handed me a bag that had half our order and half something else and no fries at all.  I had to explain 4 times what was missing.  

Philipsburg ends up with a 10 minute for just coffee and they can't even get that right. Ordered with cream. They put sugar in it and no cream 🤦‍♀️

I think it is time to roll back America on the convenience.

Perhaps it is a case of "you get what you pay for"...??

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1 hour ago, Cacao said:

I would eat my own toenails before I ate McDonald's.  Heck, I'd probably eat YOUR toenails before I ate McDonald's.

Careful, you'll catch the Rona eating toenails.  


"A Bill of Rights is what the people are entitled to against every government, and what no just government should refuse." - Thomas Jefferson

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On 7/31/2020 at 12:35 PM, conservativeman633 said:

Perhaps it is a case of "you get what you pay for"...??

Fast food isn't cheap when you think about it, unless you're getting a value sandwich.  Cheap or not, if I'm paying for it, I expect it to be right.  

We go for sit down restaurants instead because the drink is the only real price difference.  A sandwich and a side at most restaurants compares to fast food meals pricing. 

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40 minutes ago, momtothree said:

Fast food isn't cheap when you think about it, unless you're getting a value sandwich.  Cheap or not, if I'm paying for it, I expect it to be right.  

We go for sit down restaurants instead because the drink is the only real price difference.  A sandwich and a side at most restaurants compares to fast food meals pricing. 

Agree-----we all 'expect it to be right'----but perhaps it is a case of "you get what you pay for".....all I'm saying....

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55 minutes ago, conservativeman633 said:

Agree-----we all 'expect it to be right'----but perhaps it is a case of "you get what you pay for".....all I'm saying....

Anyone that has any self pride in their selves does the best that they can do and the right thing whether they are doing it for free or a million dollars.

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5 minutes ago, NikonSniper said:

Anyone that has any self pride in their selves does the best that they can do and the right thing whether they are doing it for free or a million dollars.

agree----------------but let's face it, if you are paying $1000 a plate at a fancy establishment your service would likely be a tad more sure, etc.........."you get what you pay for" may be an issue is all i'm sayin'....

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On 8/1/2020 at 5:33 PM, conservativeman633 said:

agree----------------but let's face it, if you are paying $1000 a plate at a fancy establishment your service would likely be a tad more sure, etc.........."you get what you pay for" may be an issue is all i'm sayin'....

I just expect a fastfood burger to be cooked properly to McD's own guidelines, especially considering they pretty much zap or air fry burgers these days on a set timer.

I already have an expectation that something will be missing from the order.  lol

But yes, a $1000 meal will likely be of better quality.    I've spent about $600-700 on meals for the little lady and myself at Hyde Park Grill in Cleveland (some of that was $50 shots of 80 year old Grand Marnier and other drinks).   Absolutely spectacular meals..

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1 hour ago, dubois_15801 said:

I just expect a fastfood burger to be cooked properly to McD's own guidelines, especially considering they pretty much zap or air fry burgers these days on a set timer.

I already have an expectation that something will be missing from the order.  lol

But yes, a $1000 meal will likely be of better quality.    I've spent about $600-700 on meals for the little lady and myself at Hyde Park Grill in Cleveland (some of that was $50 shots of 80 year old Grand Marnier and other drinks).   Absolutely spectacular meals..

We Had quite a few high dollar meals on vacation. I loved them but also love my fast food 😁

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