McDonald's franchise: history of the chain and opening conditions, current fees

Short description

Franchisor: McDonald's.
Type of franchise: fast food. Entry fee (lump sum): none. Royalty: from 12.5%. Investment size: 1-2 million dollars. Room area: from 2000 square meters. Payback: from 1 year. The McDonald's franchise is one of the most popular franchises in the world today. Currently, franchising is in great demand not only in the areas of selling retail goods and providing all kinds of services, but also in the catering industry. Today, this business development model is the main working model for many large and successful companies. Such a well-known brand in different countries as . However, against the backdrop of the establishment of a franchise of this company in a number of countries, the situation on the Russian market is characterized by the fact that for two decades, the enterprises of this company were opened without using a franchising type of partnership with Russian businessmen.

Basic conditions for purchasing a McDonald's franchise

The MacDonald's franchise is considered a reference all over the world. It has been successfully operating on the market for more than 100 years. To buy a franchise, you need to contact the main office (if there is one in the country). If it is not there, then you need to contact the central office in the USA. The decision depends solely on the network owners.

Attention! You need to apply for a McDonald's franchise. This can also be done online.

What is needed for the application:

FULL NAME;
Email;
address;
Date of Birth.

One of the conditions for obtaining a McDonald's franchise is management experience and a good credit history.

Once the application is approved, a telephone interview, personality and individual characteristics testing will be conducted. This is to ensure that the interviewer is confident that the candidate is familiar with business management.

The second stage is the interview. If it is successfully completed, the candidate will go to corporate training. Its cost is 10 thousand dollars.

Price

The proposal to purchase a McDonald's franchise appeared on the domestic franchising market relatively recently. The cost of this franchise is formed on the basis of a number of factors, among which the most important are the country in which the project is promoted and a specific city. In any case, the price characteristic of the franchise remains quite high. In view of the latter fact, the McDonald's franchise is not available to every Russian entrepreneur, but is focused on the capabilities of businessmen with significant financial assets.

Opening an enterprise of this brand involves the need to have funds not only for direct investments, but also for the purchase of premises and equipment, for paying for staff training and for a number of other necessary expenses.

The amount of initial capital required to purchase a franchise is described in the range of $950 thousand - $1.8 million. The cost of the franchise itself is estimated at $45 thousand. The minimum royalty amounts, monthly payments, are 12.5%. With a total duration of the franchise agreement equal to two decades, the possibility of renewing the partnership is provided.

How much does a McDonald's franchise cost in Russia?

Of course, a McDonald's brand franchise costs a lot of money and only people with good financial assets can afford to purchase it.

But its price also fluctuates and depends on the following factors:

what city and the population in it;
the presence of competitors and their position in this region.

For example, in distant regions of Russia (Far East or Siberia), an ordinary private business owner with the necessary start-up capital will be able to purchase a McDonald's franchise, since prices will not be the same as in Moscow, St. Petersburg, Novosibirsk, etc. In addition franchises, respectively, there will be costs for equipment, employee training, rental premises and others in the process of doing business.

To open a McDonald's in a big city you will need the following financial resources:

the franchise price will be approximately 40–45 thousand dollars;
monthly payments to the franchisor in the form of royalties - 12.8%;
starting capital for the possibility of concluding a contract is from 800 thousand dollars and above.

McDonald's competitors in the restaurant business are opening their establishments much more intensively in various regions of Russia, so according to some economic forecasts, purchasing a McDonald's franchise may become much cheaper over time.

Now prices change several times a month, regardless of the dollar exchange rate on the market. Also, the McDonald's company has slightly “softened” many of the conditions in the clauses of the contract in a positive way for franchisees.

https://youtu.be/gFwdjfCwXMw

Conditions

The desire to become a franchise director should be based on the willingness to undergo a long – nine-month – training course. In addition, you must be prepared for on-site training every quarter of the year - the duration of one training is from one week.

There are a number of requirements for land plots and premises necessary to open a McDonald's franchise:

The area of the plots is described in the range from 2,000 to 3,500 sq. m. meters;
the premises should be located in the front part of the building, which has access to the main street or highway.

Features of working at McDonald's

Working under the brand of this company requires participation in the social life of the community. A restaurant owner should be interested in:

Company policy;
Take part in various actions, for example, to protect the environment;
Support young football players;
Organize competitions and cultural events.

This increases the popularity of McDonald's. In this way, it commands respect from people and attracts the attention of customers.

Franchisees are approved as the owner of their own restaurant after several interviews. The company must be sure that this type of business is suitable for it. McDonald's only accepts selected candidates who have management skills and are accomplished individuals. Knowing how much it costs to open a McDonald's franchise, and this is not a cheap pleasure, many businessmen still decide to take this step and receive a good income.

Payback

The payback period for funds invested in a McDonald's franchise is one year. Among the examples of successful cooperation on a franchising basis among Russian entrepreneurs, it is worth highlighting such a large and well-known company, the specific activity of which is the opening of fast food restaurants of this brand at airports and main railway stations in Moscow and St. Petersburg. The success of the establishment and development of the project is greatly facilitated by the experience of the organization “Development ROST”, accumulated earlier in the promotion of franchising models in the catering industry.

History of McDonald's

McDonald's fast food restaurant
McDonald's is a world famous fast food restaurant that was founded in 1940 in the USA. The first restaurant opened in California, in San Bernardino. Founders Dick and Mac McDonald and Ray Kroc. McDonald's became the world's first developers of the fast food concept. They had a small restaurant that interested entrepreneur Ray Kroc.

The majority of McDonald's establishments opened around the world operate under the franchising system (about 93%). The menu and interior of restaurants may vary depending on the country. The history of McDonald's franchises has been an incredible success in Russia.

Founders of the company

Development of McDonald's in Russia

In Russia, the first McDonald's opened in 1990 in Moscow. On the opening day there were more than 30 thousand visitors, which is still a record. People had to wait for their turn for several hours. To open the first establishment in Russia, negotiations were conducted for 13 years, the cost of investments amounted to about 50 million dollars.

Additional Information! Today, the chain's restaurants are open in most cities of the country. The central office is located in Moscow.

McDonald's franchises were not used in Russia for a long time, until 2012. In 2020, the first major contract under the franchising system was concluded. The first franchise establishments opened in Novokuznetsk.

The first McDonald's in Moscow

Additional business conditions

The corresponding franchising also has additional clauses that the license holder must comply with.

Firstly, an entrepreneur is obliged to actively participate in activities aimed at protecting the environment. Secondly, it must support sporting events. Thirdly, he will need to organize youth competitions. All this is aimed at improving the image of the corporation, as well as attracting additional positive attention to the brand.

The corresponding settings are sent from above. Uncoordinated initiatives are suppressed (up to and including deprivation of the license).

Requirements for franchisees

McDonald's places high demands on candidates, understanding that the success of the new enterprise, and therefore the financial result of the franchising corporation, depends on this. McDonald's requires from future partners:

Having experience in effective business management, a broad outlook, the ability to manage the finances of an enterprise, develop and implement a business plan, the desire and ability to develop.
An ideal credit history.
Competence in organizing catering.
Desire to share the principles of the corporation, comply with its policies, promote a healthy lifestyle, and participate in social projects.
Willingness to incur high initial costs.

Staff

Usually women are chosen to work at McDonald's. As a rule, they are not beautiful, since this is one of the company's strategies. Management believes that men who flirt with pretty female workers delay the line, and this can negatively affect profits. Therefore, according to an unspoken rule, beautiful girls are not hired. In addition, female employees are prohibited from painting their nails, wearing short skirts and wearing perfume.

In the 70s, only men were hired at the company. After a while, this position was revised and girls appeared in restaurants. To prevent men from being distracted from their duties, girls were given a special uniform that hid their figure.

How much will the franchisor need to pay?

McDonald's franchising regulations clearly define the amounts of payments to the company's account for the duration of the received franchise:

Price of the service. These are regular payments depending on sales performance indicators, but not less than 4% of turnover.
Rent. Rent, calculated from the general monthly indicators of the restaurant, if the premises are taken for temporary use.
Contribution to advertising. Entrepreneurs must invest 4.5% of their profits in advertising campaigns.

In addition, the franchisee will have to take a training course in running a restaurant business for $10 thousand. Leading specialists will teach the future partner all the basics and the best marketing techniques that will contribute to the development of the enterprise. As soon as the entrepreneur successfully completes the course, company representatives will provide him with a list of selling points recommended for opening a restaurant.

Costs of opening a McDonald's

Taking into account the cost of the franchise and the costs of opening such a business in the Russian Federation, the initial investment can range from 800 thousand to 1.8 million dollars. How expensive it is to open such a business largely depends on the city.

On average, the total costs for opening alone are:

55 thousand dollars to obtain a license;
about 1 thousand for business registration;
approximately 630 thousand for construction;
40 thousand - equipment;
about 100 thousand - other expenses.

Monthly expenses:

royalties;
advertising costs (they are mandatory and amount to 4%);
5 thousand – employee salaries;
about 10 thousand - products;
2 thousand – electricity, heating, etc.;
approximately 2 thousand - other expenses. Payment must also be included here.

Profit

Profit depends on how often people buy something from the establishment, and this is directly determined by the population of the city. According to statistics, the average daily income of one McDonald's is 500 thousand rubles, which means about 182 million a year. With expenses of 94 million (largely depending on the dollar exchange rate), the net profit is about 90 million.

Such a large amount is worth opening this business. But, of course, before you buy a McDonald's franchise, you need to carefully weigh the pros and cons, really assess your capabilities, and then draw up a competent business plan.

https://youtu.be/HjNk0xhzNgA

What is McDonald's (video)?

The following video will allow you to meet the founder of McDonald's, learn about his ideas and the history of the company's development.

https://youtu.be/TFuEPM1trFI

Opening a McDonald's in your city is considered very tempting for businessmen. Watching the constant flow of visitors at any time of the day, you will inevitably think about purchasing a franchise. If you have experience and sufficient funds, then it is highly advisable to find out the company’s opinion on opening another restaurant in your city.

How to open a McDonald's franchise business: conditions and price

Reading time: 4 minute(s)
The McDonald's empire consists of 85% partner franchises and only 15% of all restaurants are owned by the company's owners.

In accordance with the terms of franchise partnership, all entrepreneurs in Russia must meet a large number of requirements.

Trademark owners are interested not only in spreading the brand, but also in maintaining the high quality of the product sold and the services provided.

The photo shows one of the McDonald's branches

About company

McDonald's is a world-famous company that operates in the field of public catering and is intended for citizens of any category and with any level of income.

This organization was founded in 1940 and has become an innovative direction in the field of public catering.

All food sold in the restaurant is standardized and does not require any special service or special utensils.

To date, more than 30,000 units have been opened around the world.

Terms and requirements

A McDonald's franchise in Russia is a real opportunity to open your own business that will generate good income.

McDonald's fast food restaurant in the photo

The main thing to remember is that all requirements and conditions must be met. These include:

Entrepreneur experience. The buyer must have an idea of how to engage in this type of activity. He must have successful projects.
The buyer must provide a business plan. Must be able to implement it.
The organization is interested in those who are ready for rapid development.
If a businessman is ready to undergo a training program, then in most cases preference will be given to him.
The entrepreneur must also have an idea of the category of clients who prefer to use the services of the network.
It goes without saying that to receive financial support from a large credit company you must have an impeccable reputation.

How to open a McDonald's franchise?

So how do you open a McDonald's franchise? If we talk about a ready-made enterprise, then there will be no big problems. Naturally, you will need to update the equipment, work on advertising and take a closer look at the staff, but with the new division things are completely different.

McDonald's products in the image You will first need to select the location where the new restaurant will be founded. Then it will be necessary to take care of the construction of the building and its decoration in accordance with company policy. We also need to establish relationships with suppliers and recruit staff.

Only after this can you think about profit. First, every entrepreneur who decides to get into this business will also have to analyze the base of possible competitors.

How much does a McDonald's franchise cost?

Every entrepreneur should understand that purchasing a franchise for an existing restaurant ranges from $500,000 to $1,200,000. It is necessary to understand that the “purchase” price directly depends on the location of the restaurant. If we talk about buying the right to open a restaurant from scratch, then it is approximately $45,000.

The main factors influencing the size of financial investments are the cost of equipment, the territorial location of the restaurant, the size of the rented premises and the cost of facing and decorating the interior and exterior of the building.

The picture shows one of the McDonald's symbols. On average, all this costs from 1,500,000 to 2,500,000 US dollars.

In addition to the fact that you will have to spend money on the direct purchase of a world-famous franchise, on the territory of the Russian Federation there are a number of additional requirements and conditions that a potential partner of the company must comply with and fulfill.

In order to receive an installment plan for a novice restaurateur, you will need to take care of making an additional contribution:

The first option is to purchase a completely new restaurant - the down payment cannot be less than 40% of the total purchase price;
The second option is to purchase an already existing and properly functioning restaurant - 25% of the price of the property.

It should be noted that advances related to borrowed funds are not taken into account. Only those financial savings that are directly owned by the buyer are taken into account, namely, shared ownership in the business, cash, debt obligations to creditors, bonds, securities and real estate.

Attention! In this case, only the property in which the potential partner directly resides is not taken into account.

The amount that remains can be borrowed (the form of such interaction is a loan or installment plan). The maximum loan period is about seven years.

The entrepreneur must also understand that the franchisor does not provide loans. And this despite the fact that it has the opportunity to arrange installment plans on the most favorable terms.

Attention! In order to be able to open a franchise of this type, you will need to have an advance of at least $300,000.

The organization opens incentive programs for individuals with good financial capabilities who expect to purchase not just individual properties, but entire chains of fast food restaurants.

Official website and contacts

To learn more about the franchise offered by the world-famous fast food corporation, you can contact the company’s office directly.

It is located in Moscow at the address: st. Valovaya, 26, business.

If, in your opinion, all the issues that have arisen can be resolved remotely, then a representative of the organization is ready to negotiate by phone.

Also, anyone interested can send information by fax. Contact numbers: real estate selection department - 8(495)755-66-24, and construction department - 8(495)755-66-24.

If it is much easier for a potential partner to receive information by email, then the address of the Russian representative office of the McDonald's chain

The picture shows the opening of a McDonald's division in one of the cities of Russia

Reviews

Like any other business, a franchise in this category has its advantages and disadvantages. If we talk about the disadvantages, then these are high financial costs and biased attitude of users. That's all, but this type of franchise has incredibly many advantages:

Opportunity to earn a high level of income;
Using an advertised brand;
Providing training;
Universal support in all matters.

Video

Watch the video about the creation of McDonald's:

The main thing that a novice restaurateur who decides to cooperate with the McDonald's empire should remember is that the company is highly developed. It is constantly expanding and can freely compete with any organization operating in the Russian market. McDonald's is a magnet for visitors.

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