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The Franchisees Are McGrumpy

In a long slump, McDonald’s needs franchisee help. Good luck

When Steve Easterbrook became chief executive officer of McDonald’s in March, there was little doubt that he’d face a tough fight with the likes of Burger King, Shake Shack, and even Chipotle Mexican Grill, in which McDonald’s once had a big investment. Yet it’s becoming clear he has other foes who may be difficult to quell: his own franchisees.

The fast-food chain is at odds with some of the estimated 3,000 men and women who operate most of its 14,350 restaurants in the U.S. A recent survey by Mark Kalinowski, an analyst at Janney Capital Markets, found that acrimony between the restaurant operators and McDonald’s corporate leaders is as high as it’s been in the 12 years the firm has polled franchise owners. Stung by falling profits, franchisees grouse that McDonald’s headquarters is out of touch with the realities of running restaurants in today’s fiercely competitive market. They also accuse the company of ignoring their concerns on everything from bloated menus to ever-more-costly kitchen equipment to wages for counter workers.