"There's no reason why we can't open 20,000 to 25,000 restaurants in China, which will be our largest market in the world. ”At the company's strategy update conference that ended early this morning, McDonald's global CEO gave the latest optimistic forecast.
Late yesterday night, the global fast food giant held such a conference for the first time in three years, announcing the fastest store opening plan in the history of 50,000 stores around the world, and launching a series of new actions such as the launch of a sub-brand that is said to be "very similar to Starbucks". At the meeting, McDonald's executives also introduced a lot of information about the Chinese business, including the first time to share the consideration of acquiring the shares of "Golden Arches" from Carlyle, as well as the future opening of stores and digitalization.
It is worth paying attention to,This is also the "golden arch" for McDonald's to increase its global holdings(Note: The abbreviation of McDonald's operating entity in China).The first event of its kind held after the stake reached 48%, Zhang Jiayin, as the CEO of McDonald's China, participated in the form of a speech. Xiaoshidai noticed that she was also the only regional head to appear on camera to introduce the business, which shows the importance of the Chinese market to McDonald's.
Below, Xiaoshidai will take you to see the latest news.
More than 30% of the new stores will be in China
Whether in China or around the world, speeding up store opening is a key focus for McDonald's.
McDonald's CFO Ian Borden said at the meeting that the company has identified three key investment areas: opening new restaurants; Technology & Digitalization; Global business services, organization and capabilities. Among them, the opening of new restaurants has been described as a "more important growth engine", with the growth rate of new restaurants gradually increasing from 4% in 2024 to 5% in 2027, and more funds will be allocated for store openings every year.
Currently,McDonald's has more than 40,000 restaurants worldwide, and it plans to have 50,000 stores by the end of 2027, equivalent to about 10,000 new stores in four years.
According to the latest store opening plan further checked by Xiaoshidai, by the end of 2027, McDonald's plans to have more than 14,000 restaurants in the United States, more than 12,000 restaurants in the international operating market (IOM, that is, McDonald's international direct business), and about 24,000 restaurants in the international franchise market (IDL, that is, McDonald's international franchise business), with new stores added during the period.
In the midst of this,IDL, which has the highest number of stores and the most aggressive store opening, is the sector to which the China business belongs, and China is also the main position of McDonald's stores in the next few years. More than 35% of the 10,000 new stores planned for the next four years will be in China.
Borden revealed,By the end of 2027, IDL expects to add around 7,000 new restaurants, more than half of which are planned to open in China. "We recently announced the acquisition of Carlyle's 28% stake in McDonald's China, enabling us to:Further benefit from the long-term growth potential of McDonald's second and fastest-growing market
Last month, McDonald's Global announced that it had agreed to acquire all of Carlyle's shares in Golden Arches, with its shareholding rising sharply from 20% to 48%, and foreign media reported that the transaction amount was about 1.8 billion US dollars (equivalent to about 12.8 billion yuan). After the completion of the transaction, the only two shareholders of Golden Arches include CITIC Consortium and McDonald's Global, and the latter's increased shareholding also gives it more say in the development of its business in China.
Xiaoshidai noticed that at this meeting, some analysts asked that when more shares of Golden Arches were obtained, this would bring more revenue to McDonald's Global, but what impact would it have on profits? Is there an opportunity to improve profitability in the Chinese market?
In response, McDonald's global CEO Chris Kempczinski said that he is "very confident" in the China opportunity in terms of margins, store opening potential and same-store sales prospects.
There are three things that make us very excited about the possibilities of the Chinese marketThe first is the potential for new restaurants, which we currently have nearly 6,000 restaurants in China. Kempczinski said McDonald's China's next goal is to reach 10,000 stores by 2028. Xiaoshidai has introduced that this is equivalent to "doubling the number of stores in five years", almost opening about 1,000 new stores every year, and the speed of store expansion is almost "twice the speed" of the first five-year plan of Golden Arches.
McDonald's global CEO Chris Kempczinski has stepped on the gas pedal to open a store, but McDonald's "ambitions" in the Chinese market are far more than 10,000 stores. kempczinski refers to,Considering McDonald's penetration in other markets – whether the average number is two, three or four McDonald's per 100,000 people, the Chinese market looks like "no reason not to open 20,000 to 25,000 stores", making it the largest market for McDonald's in the world.
Second, optimism about China's GDP growth has given McDonald's confidence. Kempczinski said same-store sales are tied to household income, which in turn is tied to GDP. Therefore,If we assume that China's GDP will grow at a mid-single-digit rate, McDonald's China's same-store sales will also grow well.
Finally, McDonald's China's earning power should not be underestimated. "There is no reason to think that Chinese restaurant margins are not comparable to those in other developed markets. ”Kempczinski said that therefore, based on the above three reasons, McDonald's believes that China has a huge opportunity, which is why it has increased its holdings in Golden Arches.
Digitalization
In order to ensure the management of the expanding store assets, digitalization was also frequently mentioned at the conference as a "powerful" digital achievement of McDonald's China's business.
"In fact, as we continue to grow, we can run our restaurants more efficiently, increasing productivity and optimizing the employee experience. ”Zhang Jiayin said in the meeting, taking the "RGM boss" implanted with artificial intelligence as an example, this digital function to assist restaurant management has improved the overall efficiency of the storeMargins improved by 30 basis pointsMore than 95% of restaurant managers believe that the work experience has improved as a result.
McDonald's China CEO Zhang JiayinIt is understood that the "RGM Boss" launched in 2022 can help restaurant managers from the three aspects of people, goods and venues, liberating them from many complex tasks and having more time to focus on customer service.
Take a Shanghai restaurant in ** as an example, first in the personnel part, the function can generate automatic schedulingReduced the amount of time managers spend on scheduling shifts from 8 hours to 2 hours per weekand make sure the restaurant is fully staffed. Secondly, in terms of goods management, this function will be managerThe daily inventory time has been reduced from one hour to 15 minutes, and the accuracy of inventory data has been improved by 30%.。Finally, in terms of venue facility management, "RGM Boss" can check the daily electricity consumption of the restaurant and make suggestions for improvementThe restaurant saves 5% of electricity
These are just a few of the AI-enabled solutions that benefit employees. Zhang Jiayin said that in the future, there is still a lot of room for imagination in digitalization.
In addition to the application of management processes, connecting more customers through digitalization is also regarded by McDonald's as a major feature of the Chinese market. Kempczinski saidThe company has 70 million loyal members in China, but fewer than 6,000 restaurants serve them, thanks to a very high level of digital orders, with 90% of orders now coming from digital devices. For digitalization, McDonald's China also intends to continue to invest heavily. According to Zhang Jiayin's statement in August this year, McDonald's China's next digital focus will include: serving the existing super 2600 million registered members, continue to expand digital channels, and accurately reach new customers. To enhance its digital capabilities, the company has built its own IT and data team of more than 300 people, and is still expanding.
A new sub-brand
After watching McDonald's China, we might as well take a look at the "easter egg" of this meeting: cosmc's.
"There is one more thingTowards the end of the speech, Kempczinski unveiled McDonald's new sub-brand, Cosmc's, using the usual opening phrase used by Apple founder Steve Jobs.
Judging by the signboard,Cosmc's uses McDonald's classic golden yellow and M-shaped elements, but with a dark blue hue to create a differentiated vision。The name is inspired by the mascot that appeared in the company's advertisements in the '80s: an alien cosmc who would love to eat McDonald's. According to reports,Cosmc's is the company's beverage-led, small-store concept, which will feature a range of beverages such as lemons, teas, iced coffees and mash-ups, which are said to have "bold and unexpected flavor combinations and vibrant colours". In addition,Cosmc's also focuses on "customization".Customization options include adding popcorn, adjusting flavored syrups, adding energy drinks, and more. In addition to drinks, Cosmc's also launched several selected McDonald's foods such as hash browns and McFull Score burgers. At the same time, the store will also have a drive-thru window for food pickup.
Talking about the reason for launching Cosmc's, Kempczinski said that McDonald's strong operational capabilities and brand preference can help it expand its business into new areas, especially attractive and fast-growing categories.
We have gained experience in specialty beverages and coffees, which dominate afternoon tea, but we are ranked lower in the market. Kempczinski saidAmong McDonald's top six markets, specialty beverages and coffee are $100 billion categories that are growing faster and more marginally than other IEO categories. McDonald's was confident of winning in this area, but it was unable to fully exploit this opportunity in its existing stores, as highly customized beverages can bring complexity to the kitchen.
It also said that McDonald's began evaluating the new brand concept more than a year ago, hoping to break the limitations of existing store operations, and explored several success criteria, including:Differentiated products or experiences, store models that deliver strong returns, and global appeal. "McDonald's doesn't do what it likes, it doesn't spend a lot of time developing an idea that only fits one market, we need great ideas that appeal globally and work in multiple markets."
As part of a small-scale test, the first COSMC's will open this month in Bolingbrook, Illinois, USA. Judging by the map, the store is about an hour's drive from McDonald's Chicago headquarters. By the end of 2024, Cosmc's plans to open 10 test stores, all of which have been revealed to be in the United States, and it is unclear whether the brand will enter China.
Although Cosmc's is still in beta, it is still attracting a lot of attention. For example, Bloomberg points out todayCosmc's model sounds a lot like Starbucks, which has grown in recent years thanks in part to the appeal of a plethora of customizable beverages, which is a key driver for customers to come back for more. Like Cosmc's, Starbucks complements its core beverage offering with limited food options.
Xiaoshidai noticed that Kempczinski also gave analysts a "vaccination" for this bold innovation, saying that Cosmc's is currently talking about only 10 stores"Don't get too excited about it".In addition, McDonald's will continue to Xi rapid learning and continue to explore new growth opportunities and expand the brand into new areas.
Higher growth targets
Finally, let's focus on McDonald's new global strategy.
The company's new growth target announced yesterday showsIn 2024, its initial guidance is for system-wide sales growth of nearly 2% (note: at constant exchange rates). This means about 2.6 billion US dollars (about 18.5 billion yuan.)9.7 billion yuan), McDonald's global system-wide sales this year are expected to be close to 130 billion US dollars (about 9300 yuan).4.6 billion yuan). During the same period, the operating margin is expected to be in the mid-to-high range of 40% to 50%. Capital expenditures were approximately $2.5 billion.
After 2024, McDonald's has higher performance targets. According to the companyIts average long-term financial target beyond 2024 is about 25%；Operating margin continued to improve; Capital expenditures will increase by about US$350 million annually until 2027.
The achievement of these goals will depend on:"Accelerating the Arches". Since 2019, the program has driven a 30% increase in same-store sales worldwide for McDonald's.
Xiaoshidai introduced that the "Burning Development Plan" is composed of three growth pillars MCD, which represent Maximize Our Marketing (M), Commit to the Core (C) and Double Down on Digital, Delivery and Drive Thru (Double Down on Digital, Delivery and Drive Thru), which correspond to digitalization, delivery, The acronym of drive-thru, abbreviated as D). At the beginning of this year, D added a new focus on restaurant development.
At this meeting, McDonald's introduced more new initiatives around MCD. For example, for the core menu, the companyBy 2026, the company plans to expand its "Best Burger Program" to almost all markets；In digitalization, its plansBy 2027, the number of loyal members will be increased from the current 1500 million to 2500 million, and system sales from this group increased from $20 billion to $45 billion；Mobile delivery orders account for 30% by 2027.
At the same time, McDonald's also announced the launch of three new platforms as part of the "Burning Development Plan". Specifically,This will include a consumer platform that accelerates loyalty member growth, an efficient operations platform for restaurants, and an operations platform that helps office workers move quickly and innovate.
As we look ahead to the next 5 to 10 years, these platforms will slowly change our sales and profit trajectory, and as they move faster and more influential, we are very excited about the future of McDonald's. Kempczinski said
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