McDonald’s Looking to Make Investors Hungry with Tastier Food

In 2015, Steve Easterbrook became the CEO at McDonald’s and since then has won praise on Wall Street for his tactical moves such as all-day breakfast and selling restaurants that were corporate owned to franchisees.

The CEO’s next move is improving the burger chain’s food.

On Thursday, the Golden Arches announced that beginning in 2018 most of its restaurants will use fresh beef in the Quarter Pounder, their signature burger, instead of frozen patties that the restaurant chain has used since 1971 when the burger was first introduced.

Under the leadership of Easterbrook, McDonald’s has promised as well to use by 2025 only cage-free eggs and is planning to quit its use of artificial preservatives in its Chicken McNuggets.

However, making a transformation of the Quarter Pounder might not be as easy as it sounds. One franchise consultant said the plan might be unrealistic.

He added that everyone needs to remember that McDonald’s is run by people that have little to no restaurant experience and have likely not ever cooked a burger.

A spokesperson for McDonald’s would not disclose the estimated costs to the owners of the restaurants for fresh beef.

Franchise owners have complained over the years that profits are shrinking and that costs are rising, which strains their relationship with leadership at McDonald’s.

An investment consulting company has requested a vote by shareholders on a proposal that would give independent owners of restaurants a new type of preferred stock which allows them to elect one board member

That plan is opposed by McDonald’s and the company asked the SEC for permission to leave the proposal off the proxy, said a report by an international news agency.

McDonald’s over the past few years lost ground, especially amongst consumers that wanted healthier and fresher food, to rivals like Wendy’s, which has touted for some time its never frozen fresh food, and chains such as Smashburger and Five Guys Burger and Fries.

During comments in a recent meeting with analysts, CSO Lucy Brady of McDonald’s said that worries over food quality cost the company a great deal of business.

Some of the chain’s best customers are not visiting with the same frequency as before and now we understand why. As expectations by the customer have increased as well as evolved, our advantages over the years of convenience, quality and value have not kept up pace with others, added Brady.

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