A survey of McDonald's Corporation ( NYSE: MCD ) franchisees run by an independent group indicated confidence in top management is very low .
87% of MCD franchisees polled by the National Owners Association were in support of calling a vote of no confidence on CEO Chris Kempczinski and the U.S. president Joe Erlinger. Close to 100% indicated that the restaurant operator should have collaborated with and consulted owner leaders before announcing changes to the franchise system, while 95% said senior corporate management does not have the best interest of owners in the approach to franchising.
Moves by McDonald's that disrupted the current franchisee system include a decision to evaluate potential new operators equally without regard to a family relationship to an existing franchisee and separating the process through which it renews leases from assessments on whether owners can operate additional restaurants. The restaurant company also has a new grading system for restaurants going into place next year that is feared could make staffing issues even more difficult.
The franchisees are said to be concerned that MCD is making some of the changes so that it can raise rents, per CNBC.
McDonald's ( MCD ) has not commented on the poll and has not given any indication that it will reverse any of its franchisee strategy decisions. A no-confidence vote could put more pressure on the C-suite.
McDonald's ( MCD ) posted a very strong Q1 earnings report and shares have outperformed the S&P 500 Index this year by a wide margin.
See consensus estimates for the MCD Q2 earnings report.
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McDonald's franchisees are not happy - what happens next?