McDonald’s Middle East franchises got into a public feud
Middle East McDonald’s locations are experiencing tensions due to the ongoing war between Israel and Hamas.
According to Israeli authorities, a local McDonald’s operator has been offering discounts to soldiers, security forces, and others since Hamas’ October 7 attack that killed 1,400 people and captured over 220 hostages. There have been a few hostages released since then. According to social media posts, McDonald’s Israel has given away 100,000 free meals so far.
McDonald’s operators in the region quickly distanced themselves from the Israeli operator’s actions. Kuwaiti, Pakistani and other franchise groups issued statements denying ownership of the Israeli franchise. Several of these franchises have made financial donations to aid those in Gaza, where more than 5,000 people have been killed since October 7, according to the Palestinian Ministry of Health in Gaza.
There is a problem with McDonald’s franchise model, in which independently owned and operated restaurants make decisions independently of the corporation. Customers may be unaware of the distinction and think actions taken by one McDonald’s location are always sanctioned by the corporation, or reflect those of other McDonald’s locations.
Franchise operators operate the vast majority of McDonald’s locations. Operators act in many ways like independent businesses: they set wages and prices and, when they feel appropriate, make statements and donations. With more than 40,000 restaurants worldwide, including nearly 27,000 outside the United States, McDonald’s has become a global phenomenon. This means the company can’t dictate how each operator responds to a crisis, for better or for worse.
Andrew Gilman, founder and CEO of CommCore, a crisis communication consulting firm, said, “You’re witnessing the risks of that business model right now.” There is less control with that business model.