McDonald's may serve Happy Meals at its 30,000 sites around the globe, but it's a pretty safe bet that meal times -- and the hours in between -- are less than joyful at the company's headquarters in Oak Brook, Illinois. Customers are defecting, franchisees are complaining, and shareholders are fleeing. Mention the Golden Arches on Wall Street, and be prepared for a bunch of "fallen arches" jokes.
Jack M. Greenberg, the chief executive of McDonald's, and his team have tried just about everything to bolster the company's sales, profits and share price. They have bought chains like Chipotle Mexican Grill, Donatos pizza and Boston Market. At the burger restaurants, they have added regional products like doughnuts and grits, offered US$0.99 meals, started the "Made for You" system of customized cooking and switched to healthier cooking oils.
The company used to open 1,000 stores a year; this year, the number is about 300. Moreover, it is shuttering some 1,000 old restaurants and opening new ones with regional motifs -- like a theater-theme McDonald's in Times Square.
Little has worked. Customized cooking has increased waiting time, while the menu additions have blurred the McDonald's image. Revenue per store keeps shrinking, profits have been down for six of the last seven quarters, and the stock, which closed at US$17.48 on Friday, is trading at the lowest level in more than seven years.
Seven restaurant and management experts were asked what McDonald's should do now. Following are their often-contradictory takes.
Wolfgang Puck -- celebrity chef and owner, Spago Restaurants:
They have to improve the product. You never hear anyone say they have a great burger. Great french fries, yes, but not a great burger.
They have to start with the quality of the meat and the quality of the bun, and with frying oil that's always fresh. If that means they have to raise the price US$0.10, fine. You just can't make a good burger for US$0.99.
In fact, that's another mistake they make: They keep advertising on price. They should talk about better rolls or Black Angus beef. They've got to raise the quality of the food and then advertise it.
And they should fix their hamburger before they branch out to other products. They are not a rib house or a chicken house. They are a burger house, and they have to do a better burger. It doesn't matter if people are buying their salads or chicken -- if people stopped buying Spago pizza I'd worry about mending it, even if people were buying more of my soup.
Alex Susskind -- assistant professor, food and beverage management, Cornell University's School of Hotel Administration:
They have to keep adding new brands. They could buy more, like Chipotle. And they could create a few. For example, they should pick a new name for the McDiners they've added to some of their traditional restaurants. It would make it a lot easier for the sit-down restaurant to compete with family restaurants like Denny's.
The core McDonald's burger brand should show up in new venues. They've already had some success with small units inside Kmarts and Wal-Marts. Movie theaters, department stores, amusement parks, any place where a family is spending hours together, would be a good place for a McDonald's. McDonald's might also do well in a Home Depot, a Lowe's or other place where construction workers or other blue-collar workers might stop by for lunch.
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