Under franchising visionary Ray Kroc, McDonald's became the world's premier food brand by selling the rights to operate a McDonald's store. With this model, MCD keeps overhead costs down and lets local owners deal with individual units, while food costs remain low and service remains fast for a culture increasingly on the go.
Big businesses struggle to grow quickly once they reach a certain size; it is logistically difficult to innovate or address individual business concerns when a burger empire spans 120 countries. McDonald's CEO Steve Easterbrook gave a presentation to shareholders in Q1 2015 to address concerns over performance. His turnaround strategy included an intentional examination of Burger King's recent success. While it is not likely McDonald's will be able to slash corporate overhead in half, something Burger King managed to do between 2011 and 2013, it is telling that Easterbrook identified refranchising company-owned restaurants as a way to drive up margins.
Read more: McDonald’s Vs. Burger King: Comparing Business Models | Investopedia http://www.investopedia.com/articles/markets/111015/mcdonalds-vs-burger-king-comparing-business-models.asp#ixzz4Sb5uPU7b
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