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How McDonald’s Made Enemies of Black Franchisees

The company, once celebrated in Black entrepreneurial circles, is settling with Black owners who say they were blocked from the best and most profitable locations.

The Carnegie Avenue McDonald’s formerly owned by Herb Washington, on Cleveland’s east side

The Carnegie Avenue McDonald’s formerly owned by Herb Washington, on Cleveland’s east side

Photographer: Andrew Spear for Bloomberg Businessweek

Herb Washington bought his first McDonald’s restaurant in 1980. He was 29, young by McDonald’s standards; a husband hoping to be a father, as the company preferred; a graduate of Michigan State University and Hamburger University. Washington had been a sprinter, nearly qualified for the 1972 Olympics, and later signed with the Oakland A’s as a “designated runner.” He lasted just a year, but it was a good year. The team won the World Series, and Washington earned about $100,000 all counted. That’s how he paid for the restaurant.

When McDonald’s decided he was ready, it also decided where he would go. For a decade, McDonald’s had been recruiting Black men—and a few Black women—to own restaurants in Black neighborhoods. Civil rights activists demanded it. Black entrepreneurs wanted it. And company executives knew it was necessary to keep the business growing. Some of the restaurants were new, many had been owned by White operators who wanted, or were advised, to sell. White residents were abandoning cities for the suburbs, and so were White McDonald’s franchisees. McDonald’s itself wanted to stay. Washington was told his McDonald’s would be in Rochester, N.Y., in a poor Black and Hispanic neighborhood, next to a public housing complex called Fight Village. Other Black operators called these “hood restaurants.” Washington didn’t know that yet.