Hey McDonalds, let's see if this sticks to the wall

Hey McDonald’s let’s see if this sticks to the wall!

            I continue to read articles and blogs about what McDonald’s needs to do to prop up their sagging sales and haven’t yet seen the answer that could be the simplest.  Recall the last quarter of 2002 when McDonald’s stock was trading a tad above $12 a share and many industry observers were talking about the “good old days” as it appeared the venerable burger giant was slipping backwards.

            Just as when a struggling sports franchise is faced with a losing season(s) and they fire their “head coach” there was a quick game of musical chairs in the boardroom.  Out was a CEO who was focused on a new cooking platform and “In” was a CEO who was focused on the fundamentals, or perhaps better execution of those fundamentals.

            The burger behemoth began an execution turnaround that saw their stock soar from around just over $12 to just over $36 per share within less than one year.  I’m not a financial guy but I have been in the food and beverage business since I was eleven (11) and possess a decent memory of its progress and feel fairly confident in saying that whatever management did, they did it well!

            Let’s review some recent tactics of the Oakbrook, IL gang and then we’ll circle back around for some personal observations. We previously reviewed what we dubbed as the “The Value Menu goes Premium” (February 2, 2014) which appeared to us that something was stirring or amiss in the Chicago suburbs.  More recently we have seen a test of a Chorizo Burrito for breakfast (August, 2014) and a “Build your own Burger” kiosk-style ordering system (November, 2014) whereby guests can create their own “burger experience” which appears akin to what the same consumers can do with their coffee at Starbucks.

             Perhaps the meteoric growth of fast-casual burgers chains should have been a heads-up to Goliath that the David’s saw an opportunity the burger leader missed.  Let’s do a quick inventory, a burger that isn’t cooked until you order it, in many cases either in-house or locally fresh ground meat, a multitude of fresh toppings, artisan sandwich buns and beer or wine along with the usual soft drink suspects.  Yes, the price point is higher; however, but obviously the consumer will pay for those quality ingredients!  Did I hear someone say something about a “better” mousetrap?

            No doubt the truly qualified professionals (being sincere here) whose hard work to build the McDonalds brand and grow the concept nationally were dedicated to their cause, but somewhere along the way someone needs to remember where they started.  I can remember as a child when the “big treat” of the day was to stop at the only local unit on an empty stretch of what was country road to relish in a burger, fries and cola and we embraced it.  The food was always hot, the cheese was melted, the drinks refreshing.  I admit it was a tad simpler time but those basics and the focus used to produce them may have become lost over the years.

            How to stop the sales slide at McDonalds may not be an easy fix and certainly not attainable within this framework.  I would offer one suggestion, instead of throwing an increasing number of new menu items against the wall, how about focusing on and executing those aforementioned fundamentals?  To use well-worn sports rhetoric and quote Vince Lombardi, “this gentlemen is a football”, it’s all in the fundamentals.