In the past, some so-called experts of 'food business' have predicted the inexorable decline of McDonald's only to be proven wrong time and again. In light of some recent economic figures, it seems that the experts are again predicting the end of McDonald's as the world's leading franchise brand. I don't believe it myself, but here are there theories.
Financial analyst Tim Begany, writing on The Street, says that McDonald's can no longer deliver the big earnings for investors that it once did - "the 14% a year it posted during the past half-decade". Now while this seems to only pertain to the stock market, I think many of Begany's points are rooted in the reality of food franchising right now.
In fact, he makes two really interesting points about the state of McDonald's right now. He says they are up against incredible competition, primarily from the growing Yum! Brands stable of franchise brands. He also says that McDonald's prominence as the world's leading franchise brand as made the biggest target in business for anti-obesity campaigners and the likes. To the end, I thought it was interesting that the McDonald's head of food innovation, chef Daniel Coudreaut. "I don't see anything on the menu that's unhealthy" and spoke about the benefits of moderation.
Perhaps McDonald's may not be able to enjoy a monopoly on the global franchising market, but I've travelled all around the world and I know that people everywhere, no matter what the culture love McDonald's. The Street is also quick to dispatch some copperfasted facts about McDonald's. For instance, its annual profits of $27.4 billion a year "is more than twice that of the closest competitor. The company's net profit margin of 20% is almost twice the industry average of 11%." They may not enjoy the incredible growth of the past, but they're still sitting pretty.