CHICAGO — McDonald’s Corp., already struggling to sell burgers in the United States, now must contend with a brewing franchisee revolt.

Store operators say the company, looking to improve its bottom line, is increasingly charging them too much to run their restaurants — including rent, remodeling costs, and fees for training and software. The rising costs are making franchisees, who operate almost 90 percent of the chain’s more than 14,100 U.S. locations, less likely to open new restaurants or refurbish old ones, potentially constraining sales.

McDonald’s is “doing everything they can to shift costs to operators,” said Kathryn Slater-Carter, who in June joined other franchisees in Stockton, Calif., to brainstorm ways of getting the chain to lessen the cost burden. “Putting too much focus on Wall Street is not a good thing in the long run.

“It is not as profitable a business as it used to be,” said Slater-Carter, who owns two McDonald’s stores.

Asked if McDonald’s is shifting costs to franchisees, Heather Oldani, a spokeswoman, said in an email: “We are continuing to work together with McDonald’s owner/operators and our supplier partners to ensure that our restaurants are providing a great experience to our customers, which involves investments in training and technology.”

McDonald’s, which owns or leases most of its U.S. stores, has been generating more income from them. Revenue from franchised stores, which includes rent and royalties, increased 8 percent on average during the past five years, while total revenue rose 4 percent.

Some franchisees are paying as much as 12 percent of store sales in rent, according to notes of an April 23 meeting attended by store operators. Instead, they want the company to return to a historic rate of about 8.5 percent, the document shows.

Franchisee Slater-Carter is now forking over an extra $10,400 per store annually for new software, Wi-Fi and employee training costs — all fees that McDonald’s has tacked on in the past five years.

“The corporation itself is forgetting that its fiscal strength rides on the fiscal strength and the creativity of the operators,” she said.


Only subscribers are eligible to post comments. Please subscribe or to participate in the conversation. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.