Wednesday, May 27, 2015

Cook the Burgers and Bury the Books!

May 27, 2015
McDonald’s Will Change How Its Burgers Are Cooked

He also said the company would, as many of its rivals have, stop reporting monthly sales.

Beats cooking the books and burying the burgers! Well, maybe.

In all seriousness, the management at McDonalds must not have much faith that their changes will work. One certainly wouldn't stop reporting monthly same store sales if sales were expected to rocket higher.

Note to self: Restaurant competition seems especially fierce these days. Probably best to not use my life savings in pursuit of the "owning my own restaurant" dream, not that I ever did have that dream.


Rob Dawg said...

I'm okay with less than monthly retail sales reporting as long as the quarterlies are consistent. We really do too often fall into the trap of smaller slices being more useful. They are not. Take for instance breathing. If you breathe at 15 per minute and sample at 15 minute at the exhale you'd be convinced that humans produce oxygen.

Stagflationary Mark said...

Rob Dawg,

That said, I remember when Sears stopped reporting monthly same store sales. They apparently tired of the ugly numbers streak. Go figure.

Anonymous said...

Have some friends that bought into a popular sub chain in the area. They are the top grossing store, but still do not make enough off the store to cover expenses. Yikes! Fortunately they have two good incomes to spend on the sub shop monthly.

Stagflationary Mark said...


Your story scares the heck out of me! Your anecdotal evidence backs a major concern I have.

We know people are eating out more than they once did. That does not necessarily imply that it is a good time to get into the restauramt business though, especially if everyone thinks it is a sure thing.

Warren Buffett has said that the way to make money off the automobile industry was not to invest in car companies, but rather to short horses.

There were just too many car manufacturers and too many investors piling money into them. The only sure thing was knowing that we'd generally stop riding horses.

The same thing happened to the airline industry.

The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines. Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down. - Warren Buffett