McDonald's Franchise Gets Fat Returns On Franchised Stores

June 23, 2010 - PRLog -- McDonald's Gets Fat Returns On Franchised Stores, Little Meat From Company .

McDonald's, the leading global food-service retailer, has achieved dramatic growth using the franchise business model. We estimate that franchised stores currently contribute around 92% of McDonald's stock value. The remaining 8% comes from company-owned stores.


Learn more about the McDonalds Franchise Model here.
http://www.franchiseexpo.com/McDonalds-Franchise-Information.cfm

By contrast, company-owned stores are still a major business for Starbucks, contributing 46% of its total stock value according to our analysis.

Here's why we expect company-owned stores to contribute relatively little to the value of McDonald’s stock going forward.

1. Decline in company owned stores as McDonald's re-franchises them

The number of McDonald's own-operated stores has declined by nearly 24% in the past three years, from more than 8,100 stores at year-end in 2006 to around 6,200 stores at the end of 2009. Most of the reduction in company-operated stores came from converting them to franchised stores, which generate more profit for McDonald’s with fewer operating hurdles.

Learn more about the McDonalds Franchise Model here.
http://www.franchiseexpo.com/McDonalds-Franchise-Informat...

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