The deflection is real. In the beginning of the month, news broke that 52 former McDonald’s franchisees had filed a lawsuit against the golden arches fast food chain for unfair treatment, racial discrimination and a breach of contract.
The lawsuit states that McDonald’s was intentionally forcing black franchisees to operate their businesses in what they called “depressed, crime-ridden neighborhoods.” As a result, black franchisees are more susceptible to experiencing smaller profits and additional overhead costs due to having to purchase extra security and conduct constant repairs and upgrades.
An audit of McDonald’s showed that between 2011 and 2016, black franchise owners averaged less than $700,000 in annual sales compared to other franchisees, with that increasing by $200,000 in 2019.
“Revenue, at McDonald’s, is based on one factor and one factor only: location,” the plaintiffs’ attorney James Ferraro said. “It has nothing to do with the taste of a Big Mac. You don’t go to a different McDonald’s because the Big Macs are better. You go to the closest McDonald’s, period.”
Out of the 1,600 franchisees that McDonald’s has in the United States, less than 200 are black franchisees. Yet, McDonald’s has maintained a reputation of being one of the the top companies to support the black community via a diverse workforce. The catch is that most of the diverse workforce lies on the frontlines of the business as the cooks, cashiers, and restaurant managers, and less in the corporate boardroom.
Recently, the fast food company announced that it will be partnering with Houston-bred rapper Travis Scott to produce the “Travis Scott Meal.”
The menu selection will consist of a quarter pounder with cheese and bacon, BBQ sauce fries, and a Sprite. The promotion will start on September 8 through October 4.
“I couldn’t be more excited to bring the Cactus Jack x McDonald’s collaboration to life,” Scott said in a written statement. “We are bringing together two iconic worlds.”
In other McDonald’s news, the McNuggets are about to garner some more attention for the company. In an attempt to entice customers back to the fast-food restaurant, McDonalds is introducing a spicy chicken nugget. This is the first flavor upgrade to the McNuggets in almost 40 years.
The Spicy McNuggets will have a breaded tempura coating infused with cayenne and chili peppers. To complement the new spicy alternative, McDonald’s is also creating a new dipping sauce called, Mighty Hot Sauce. The Mighty Hot Sauce, which is the first new dipping sauce in three years, will consist of a blend of crushed red pepper, spicy chilies and garlic among other ingredients.
Compared to sales from a year ago, McDonald’s sales have fallen 30 percent with net income plunging 68 percent. Just like the rest of the country as it pertains to the pandemic, McDonald’s is optimistic about a turnaround.
“Sales for locations that have been open for a minimum of a year were down 19 percent in April of 2020 but in June they were down only 2.3 percent with an uptrend for the month of July,” Kevin Ozan, the Chief Financial Officer, said.
With the year 2020 quickly drawing to a close, it will take some time to see if the McDonald’s deal with Travis Scott and introduction of the spicy nuggets as a new menu item will overshadow the inevitable question that everyone is pondering.
Does McDonald’s practice systemic racism and if so, what are they going to do to change that?
