McDonald’s’ British expansion plans are being scuppered by bureaucracy and planning red tape, the boss of the fast food chain has said.
Alistair Macrow, UK chief executive, said the company was facing waits of up to three years to open new restaurants because of delays at local council levels and excessive bureaucracy.
Mr Macrow told The Telegraph: “The planning timeline in this country for us has on average increased by 55 weeks since Covid.
“Today it takes us pretty much three years from the moment that we approve a new site to open. Of those three years, only 43 weeks are within our control, the rest is outside of it.”
Developers across the company have complained of long delays in gaining planning approval, with house builders in particular sounding the alarm over long waits.
The problem has been blamed on new tighter environmental regulations and a lack of skilled staff at local councils.
Cllr Darren Rodwell, housing spokesperson for the Local Government Association, said: “Councils have lost a number of experienced planning officers in recent years as a result of increased workloads, particularly since the pandemic and salaries that struggle to compete with the private sector.”
Mr Macrow’s frustration comes as McDonald’s undertakes a significant investment campaign in Britain. The fast food chain is planning to invest around £280 million in the UK over the next four years aimed at making its restaurants more efficient.
Plans include the addition of features such as separate waiting rooms for delivery drivers and “smart” scales in kitchens that can tell if items have been left out of a bagged order.
The investment comes as McDonald’s battles to keep costs down during the worst inflation crisis in 40 years. Last year, the chain was forced to raise the price of a cheeseburger for the first time in 14 years, putting it up from 99p to £1.19.
Mr Macrow, who has been at the company since 2007, said: “Back in my days as UK marketing director, I was really excited about launching our saver menu – January 2, 2009, I still remember the date. We launched the Mayo Chicken, that was our new ‘hero product’, 99p. It was still 99p at the start of this year… we’ve had to move that now to £1.19.”
Prices of some items on the menu have risen for the first time in some cases as the cost of everything from energy, to wages, to potatoes has surged.
He refused to rule out further price rises but argued that the chain still represents good value compared to rivals. It is hoped that investment in cost-saving technologies will also help keep price rises to a minimum.
“Inflation is inflation. We can’t change that,” he said. “We’re sitting here and you can have a hot burger, fries and a drink served to your table for £3.99. I don’t know too many [businesses] able to do a better job.”
As well as battling inflation, the company is fighting to restore its corporate image after a high-profile sex scandal.
Global chief executive Steve Easterbrook was sacked in 2019 after admitting an “inappropriate” but consensual affair with an employee.
Mr Easterbrook was handed a generous exit package worth tens of millions of dollars, but McDonald’s subsequently sued him to recover the award after it discovered evidence of other, undisclosed sexual relationships with staff members.
The company now faces a lawsuit in the US from aggrieved shareholders who have accused Mr Easterbrook and other senior management of fostering a “party atmosphere” that contributed to the scandal.
In the UK, the Bakers, Food and Allied Workers Union (BFAWU) said in 2019 it was aware of 1,000 instances of harassment against McDonald’s staff.
McDonald’s says this figure “was not substantiated, and no evidence presented to us relating to this volume of cases at the time”.
Mr Macrow, who was promoted to run the UK and Ireland business in 2021, said the company has “a strong culture of people who enjoy being together”.
In reference to Mr Easterbrook, he said: “You shouldn’t take what has proven to be the behaviour of an individual to represent the company.
“The culture of the company has always been very, very strong. Yeah, there’s an individual situation, which has been widely publicised and has been dealt with exactly the way it should do.
“It’s been dealt with that way because values are the most important thing in our business and it’s putting that straight.”
He stresses the company has “doubled down” on safeguarding, including signing a legally-binding agreement with the Equality & Human Rights Commission earlier this year to protect staff from sexual harassment.
Mr Macrow, who has also worked at Marks & Spencer and Debenhams, said: “We are absolutely committed to making sure there’s no place for any sort of harassment.”
He revealed that McDonald’s – like several other companies – cancelled its membership of the Confederation of British Industry (CBI) when the lobbying group was engulfed in a sexual misconduct scandal earlier this year.
Besides its culture, Mr Macrow must also continue to work on changing the perception of McDonald’s as unhealthy food.
The chain has struggled to shake-off the association with bad diets and poor health ever since the documentary Super Size Me was released almost 20 years ago.
In 2019, then-Labour deputy leader Tom Watson branded one of its ad campaigns “a danger to public health” for a Monopoly-themed marketing promotion which offered desserts and other items as prizes.
Obesity has only become a greater issue since the pandemic and NHS England last week announced it would open 10 more specialist obesity clinics for children after a surge in the numbers of overweight young people.
53 year-old Mr Macrow, who was McDonald’s’ global marketing chief during the pandemic, admits that “obesity is an issue in this country” but argues that his company is doing its bit to help address the problem.
He said McDonald’s has removed thousands of tonnes of fat, salt and sugar from its menu over the last few years.
“We started with the Happy Meal,” he said. “We basically tackled things like nuggets, and fries from a salt, fat and sugar point of view. We’ve significantly reduced the amount of salt on our fries.”
Mr Macrow does not agree that much of McDonald’s’ food should be lumped in with ultra-processed foods (UPF), a classification that has recently caught the public’s attention because of its negative impact on health.
He said: “You go to our beef plant in Yorkshire and watch whole cuts of beef come in the back door. They go into a mincer to get folded into a patty and get frozen. That’s it. And then after we cook them, we add salt and pepper.
“I’m sure there’ll be people out there who think that’s Ultra Processed Food. To me that is fresh beef served in a really good way.
“I’m not sure how many people realise that every Egg McMuffin comes from somebody cracking an egg and one of our kitchens and putting it and putting it onto the grill.”
McDonald’s sells a vegan burger called the McPlant in the UK despite the fact it was dropped in the US business after a trial last year. It comes amid a wider slowdown in demand for vegan alternatives, which boomed in popularity during the pandemic.
Mr Macrow believes vegan dining is here to stay but says many went “too far too fast” with their expansions.
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Source: https://finance.yahoo.com/news/red-tape-means-takes-us-100000346.html