McDonald’s (MCD) – Get McDonald’s Corporation Report must serve two constituencies: customers and franchise owners. The interests of the two groups don’t always dovetail, which sometimes puts the company in a challenging position.
Customers, for example, loved the $1 menu because, well, you could buy actual food for $1. Franchise owners were much less happy with that particular deal menu because it pared their profit margins.
That forced parent McDonald’s to tweak its value offerings and come up with ideas that produced higher check values and wider margins. Customers don’t care about margins — they want cheap burgers and snacks — but McDonald’s has to leverage the wants of its customers over keeping its franchisees happy.
If any menu addition puts this divide into focus, it’s “all-day breakfast.” The chain launched the program in October 2015, after what seemed like decades of customers asking for it, and then dropped it in 2020 due to the pandemic.
Why Do McDonald’s Franchise Owners Hate All-Day Breakfast?
Franchise owners have long taken issue with all-day breakfast because it adds complexity to the menu and it shifts customers into cheaper breakfast menu choices and away from pricier lunch/dinner items.
“All-day breakfast is a nonstarter. We are trading customers down from regular menu to lower-priced breakfast items. Not generating new traffic,” a franchise owner said, according to a Yahoo report in 2015.
The website posted some other complaints from a survey the parent gave to franchise owners
“In small stores, the problems are vast with people falling over each other and equipment jammed in everywhere.”
“Customers are abandoning us in droves because we are either too slow, or sub-par quality.”
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Another franchise owner pointed out that the added menu complexity required more workers.
“Unfortunately, with the current labor pool in our area, we are struggling to have enough people to run the shift, much less add an extra person.”.
And that reason may be why McDonald’s does not restore the all-day breakfast menu. The chain, like many of its rivals, has been struggling to hire workers even as it has raised wages. That’s a problem that’s not likely to change anytime soon.
McDonald’s Customers May Not Get What They Want
McDonald’s ended all-day breakfast during the pandemic when it was trying to simplify its menu. The chain has not brought it back, even as it has restored most of the changes it made during the worst of its dining-room shutdowns during the pandemic.
Chief Executive Chris Kempczinski made clear in his company’s second-quarter 2020 earnings call that not everything would go back to how it was before the pandemic.
“As we come out of it, as I’ve said in prior times, I think, it is a safe bet that you are going to see us add items back to the menu,” he said “I think it’s also equally a safe bet that we’re not going to go all the way back to where we were.”
His comments after that did not address all-day breakfast, but they did hint at its fate.
“And then what the U.S. operators have talked about with our team has been, let’s just make sure every item that we add earns its way back onto the menu. And I think that mentality, that mindset, is how, not just the U.S., but every market is sort of looking at it,” he added.
This has not stopped fans from calling for the return as all-day breakfast was a popular (but by no means the most popular) answer when McDonald’s recently asked its Twitter followers what it should bring back.
Fans want all-day breakfast — you can certainly see why someone might want a McMuffin in the afternoon or evening — but McDonald’s probably doesn’t want to bring it back. That’s not likely to change unless the company can find a way to make the morning meal all-day long without it being a hassle for stores or a drag on their profits.