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> decrease in revenue for McDonalds. It’s not a major problem for McDonald’s Inc. though! They don’t sell McFlurries! They lease buildings and land, and they d

by xp84 2y ago

> decrease in revenue for McDonalds. It’s not a major problem for McDonald’s Inc. though! They don’t sell McFlurries! They lease buildings and land, and they do collect a 4% royalty on sales. But the franchisee loses the other 96% of the revenue and has to pay 100% of the “authorized Taylor repair” bill. So it’s a much bigger problem for them, and a moral hazard for McDonald’s to be able to force the store owners to use the overpriced and supposedly unnecessary (other than due to digital locks) Taylor service offerings.

gruez 2y ago
If they want to squeeze more money from franchisees why not jack up the rent or royalties? The Taylor conspiracy is far less efficient at getting revenue (at the very least, you need to pay the technician), and doesn't even seem to be working very well, as evidenced by the number of stores not bothering to repair their machines.
- lazide 2y ago
  The top of the line cut is probably hard to move without causing a big ruckus. Fluffing individual line items is probably a lot easier.
- xp84 2y ago
  > If they want to squeeze more money from franchisees It's probably safe to say that any public company very much does want to ;) > why not jack up the rent or royalties? I assume that they will always do that (as much as contracts allow, and as much as the market will bear) regardless, so any upside from this scam is just incremental revenue on top of that. Although I admit it's been so long since I read the original stories about this that I forgot what's in it for McDonalds Inc. Clearly Taylor's parent company makes out like a bandit (I'm assuming they pay the techs poorly and thus have a high margin) but IDK how much visibility we have publicly to what the financial arrangements are now, vs. what it might be if McDonalds Inc ripped up the Taylor contract tomorrow and say, signed a new one with a company that wasn't evil. Because I agree that I don't know how those dots are connected.

by xp84 2y ago

gruez 2y ago

If they want to squeeze more money from franchisees why not jack up the rent or royalties? The Taylor conspiracy is far less efficient at getting revenue (at the very least, you need to pay the technician), and doesn't even seem to be working very well, as evidenced by the number of stores not bothering to repair their machines.

lazide 2y ago
The top of the line cut is probably hard to move without causing a big ruckus. Fluffing individual line items is probably a lot easier.
xp84 2y ago
> If they want to squeeze more money from franchisees It's probably safe to say that any public company very much does want to ;) > why not jack up the rent or royalties? I assume that they will always do that (as much as contracts allow, and as much as the market will bear) regardless, so any upside from this scam is just incremental revenue on top of that. Although I admit it's been so long since I read the original stories about this that I forgot what's in it for McDonalds Inc. Clearly Taylor's parent company makes out like a bandit (I'm assuming they pay the techs poorly and thus have a high margin) but IDK how much visibility we have publicly to what the financial arrangements are now, vs. what it might be if McDonalds Inc ripped up the Taylor contract tomorrow and say, signed a new one with a company that wasn't evil. Because I agree that I don't know how those dots are connected.