McDonald’s is trying to turn around its United States business. It is attempting to increase the profitability of the business. According to sources, one part of its plan to turn around the business might involve laying off employees.
According to an email by the president of the company, the restructuring will involve laying off some employees. The email did not elaborate on the number of employees which might be laid off. According to the email, more details will emerge in the next week as a meeting will be held by the Pres.
No official confirmation from the McDonald’s spokesperson:
A spokesperson of McDonald’s was asked about this. However, he did not confirm any layoffs. He was quick to add though that there might be some change in the entire structure of the organization.
According to Terri Hickey, spokesperson of McDonald’s, the new structure will be better for the franchises. Also, it will ensure that McDonald’s as a company is more nimble and more flexible. It will also increase the competitiveness of the company. He also added that the entire restructuring was with the single goal of trying to save another $ 500 billion and this goal will be achieved by the end of 2019.
Challenges in US business: McDonald’s
The McDonald’s business of United States is struggling. In the recent years, it has been hacked by quite a few scandals as well. As a result, the company is trying to offer new food items and recipes to the consumers. Also, the profitability is consistently declining as well. This is the reason why it is trying to change its entire model in order to increase profitability.
McDonald’s store sales declining:
In addition to the problem being faced by the company of unhealthy food offerings, the store visits are also declining on a consistent basis. They were down by 5% during the 1st quarter. However, after the new offerings they managed to increase the sales by at least 3% in United States. However, still the growth remains pretty tepid. This is the reason why the company is trying to change its entire structure in order to ensure that it is able to grow in the market in United States. It remains to be seen whether these new initiatives by the company are able to increase its growth or whether the growth again slows down further.
Also, many people are waiting to watch whether it will indeed result in mass layoffs. Keyword: McDonald’s, US turnaround, layoff