The Latest McDonald's "Roast": Delivery Services
I feel as though I'm venting about McDonald's (MCD) far more than normal, but it's mostly because I'm still amazed that its management leaders just do not understand that consumers are fed up with how the company is looking to justify long-term growth. What is the latest folly? Delivery services.
Yeah. That's EXACTLY what we need here in the U.S.
The fatties who are addicted to McDonald's products had one thing going for them: they actually had to physically move to get themselves into a car to drive to a McDonald's and may or may not get out of that car in order to get their meals. How much worse are you making it for people by making it so that they potentially never have to leave their houses. Yeah, really smart to "enable" those who are already horribly unhealthy thanks to McDonald's.
Management sees this delivery option as a $100 billion market in which the company can boost its failing growth. In this market, they see sales growth of about 5.0%, and note that the majority of the U.S. population in top markets live in relatively close proximity of at least one McDonald's. The company also aims to boost operating margins from the high-20% range to around mid-40%.
It also plans to bring mobile ordering and payment to 20,000 restaurants in some of its largest markets, including the U.S., by the end of the year. That would mimic a strategy that’s proven successful for Starbucks and other restaurants, which use the software to lock in customers. While this news did help to boost the stock, they're missing a valuable opportunity to do a lot of good for the community at large.
I would like to see McDonald's take a much more holistic approach and although I think they are getting there, encouraging their customers to be even more stationary than many already are, is doing no one any favors now or ever.