McDonald´s China is trying to sell its 2,200 stores for up to US$2 billion to third parties. A move that makes sense, says retail analyst Ben Cavender in CFO, because the number of people able to run chain stores has gone up exponentially.
The McDonald’s brand has lost its early luster in China, with market share declining from 15.1% in 2010 to 13.8% in 2015. Cheung said McDonald’s is looking for a Chinese partner with a “deep understanding” of China’s market, rather than one that can simply bankroll new stores.
A franchise-only model in China makes sense now because the market has matured to the point where there are more people with experience running fast-food chains and fast-casual restaurants, according to Ben Cavender, director at China Market Research Group.
“There’s a stronger talent pool, and they have the capability to operate a franchise and operate it well,” he told the WSJ. ” Brands are also clamoring to try to grow into new markets, and they might not be able to do it quickly by themselves, and they need help.”
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