WEBVTT - Chris Kempczinski 0:00:02.840 --> 0:00:05.040 McDonald's has been at the top of the food chain 0:00:05.120 --> 0:00:09.559 for over sixty years. It's CEO, Chris Kemchinsky, says it 0:00:09.680 --> 0:00:13.480 stayed there because of McDonald's guaranteed quality, experience, and connection 0:00:13.560 --> 0:00:16.840 to its communities. In this episode, appear to appear I 0:00:16.920 --> 0:00:20.319 visited McDonald's headquarters in Chicago to find out what makes 0:00:20.320 --> 0:00:23.800 their fries so addicting, what makes their Coca Cola perfect, 0:00:24.000 --> 0:00:26.319 and how the restaurant plans to stay on top for 0:00:26.360 --> 0:00:29.600 another sixty years. Companies more than sixty years old now, 0:00:30.440 --> 0:00:33.280 and many companies over the last sixty years have gotten 0:00:33.320 --> 0:00:35.479 in the fast food business. Some have done okay, so 0:00:35.520 --> 0:00:37.879 I'm going out of business. But McDonald's is by far 0:00:37.920 --> 0:00:40.240 the biggest. You have a market capitalization about a hundred 0:00:40.240 --> 0:00:42.279 and seventy five billion dollars. What is it that made 0:00:42.360 --> 0:00:45.320 McDonald's by far the biggest of the fast food companies. 0:00:45.520 --> 0:00:47.320 I think it starts with the brand. I mean, we 0:00:47.440 --> 0:00:50.080 have a brand that is one of the most valuable 0:00:50.120 --> 0:00:53.199 brands in the world. And how did you get to 0:00:53.280 --> 0:00:55.279 that brand? It was a combination of things. I mean, 0:00:55.280 --> 0:00:59.440 it's started with Gray Croc recognized the importance of ubiquity 0:01:00.200 --> 0:01:02.880 and so That was part of the genius or genesis 0:01:02.920 --> 0:01:06.760 of of doing a franchise model, because with a franchise model, 0:01:06.760 --> 0:01:10.200 he could get capital deployed, get restaurants built more quickly 0:01:10.800 --> 0:01:12.360 than he could if he was trying to do this 0:01:12.400 --> 0:01:14.480 all on his own. So that was one idea. I 0:01:14.520 --> 0:01:18.520 think the second was the production system, the speedy production system. 0:01:18.520 --> 0:01:22.760 It guaranteed equality of the experience that people knew no 0:01:22.800 --> 0:01:25.760 matter where you went, you could get a consistent experience 0:01:25.760 --> 0:01:29.000 at McDonald's. And then it certainly came from, you know, 0:01:29.120 --> 0:01:31.840 our attachment in the local community. One of the things 0:01:31.840 --> 0:01:36.000 that also Ray Kroc was very focused on was building 0:01:36.040 --> 0:01:38.160 the brand at the local level. That's why he wanted 0:01:38.160 --> 0:01:41.280 the franchise ease engaged in the restaurants, and so you 0:01:41.360 --> 0:01:45.120 saw getting involved in schools, getting involved with you know, 0:01:45.160 --> 0:01:47.880 birthday parties, all those things. Those were all part of 0:01:47.920 --> 0:01:51.040 building the brand that ultimately now I get the benefit of, 0:01:52.000 --> 0:01:56.040 you know, protecting and hopefully further shining the arches. So 0:01:56.200 --> 0:01:58.840 you are the CEO of this company for the last 0:01:58.880 --> 0:02:01.520 couple of years, and has you been doing this? Uh? 0:02:01.600 --> 0:02:03.520 Have you had to deal with the COVID problems in 0:02:03.560 --> 0:02:07.200 particular COVID has been an issue that's impacted us in 0:02:07.240 --> 0:02:10.360 every country that we operated in a hundred and twenty countries, 0:02:10.440 --> 0:02:13.440 and it's been kind of a unique experience because what 0:02:13.520 --> 0:02:17.280 we've dealt with regional issues before. We've dealt with stars 0:02:17.320 --> 0:02:20.440 and mirrors and swine flew and things like that, but 0:02:20.480 --> 0:02:23.640 we've never had an issue where it impacted literally every 0:02:23.680 --> 0:02:27.639 country all at about the same time, So huge issue 0:02:27.680 --> 0:02:30.120 for us. It varied around the world. Some places went 0:02:30.160 --> 0:02:33.040 into complete shutdown. In the US we were able to 0:02:33.120 --> 0:02:36.400 keep the restaurants open, but drive through only UH, and 0:02:36.440 --> 0:02:38.760 that was I think part of where are the genius 0:02:38.800 --> 0:02:41.320 of our system came to light, which is you were 0:02:41.360 --> 0:02:44.760 trying to manage this situation everything from Chicago. It never 0:02:44.800 --> 0:02:47.560 would have worked. The fact that we're a locally owned 0:02:48.360 --> 0:02:51.520 company with franchise ease, they're able to act much more 0:02:51.600 --> 0:02:54.320 nimbly than than we could from the center. And somehow 0:02:54.400 --> 0:02:57.200 another knock on wood a year later, Um, you know, 0:02:57.280 --> 0:03:00.360 we are in a very strong spot, and it's it's 0:03:00.400 --> 0:03:03.360 hard to believe really, So when COVID hit, UH, many 0:03:03.440 --> 0:03:07.519 people didn't go out anymore. They weren't buying McDonald's products, 0:03:07.560 --> 0:03:09.840 other people's products as well. Did you have to lay 0:03:09.880 --> 0:03:11.840 off people for low people? How did you deal with 0:03:11.840 --> 0:03:14.959 your employees or the franchisees had to do that. Yeah, 0:03:15.000 --> 0:03:18.520 we didn't lay anybody off, certainly from the company's standpoint, 0:03:18.520 --> 0:03:22.320 And our franchisees went through quite a bit of effort 0:03:22.360 --> 0:03:25.079 to make sure that either through government programs or through 0:03:25.120 --> 0:03:27.480 things that they could do on their own, that they 0:03:27.639 --> 0:03:31.200 kept attached to their staff, that they kept the staff 0:03:31.800 --> 0:03:35.680 uh working and available to the restaurants. And so I think, 0:03:35.800 --> 0:03:38.320 you know, well, we have forty thou restaurants. I don't 0:03:38.360 --> 0:03:42.160 know every particular situation. By and large, we were able 0:03:42.200 --> 0:03:45.240 to retain our workforce through all of that. What did 0:03:45.240 --> 0:03:48.400 you learn through COVID about how to manage a company differently, better, 0:03:48.520 --> 0:03:51.080 or some other ways that you would have not probably 0:03:51.120 --> 0:03:53.600 learned if you had not going through COVID. I certainly 0:03:53.640 --> 0:03:56.760 think one of the things that we saw was our 0:03:56.800 --> 0:04:03.440 ability to stay connected through technology bes Zoom, Yeah, Amazon Chime. 0:04:03.520 --> 0:04:06.840 I've learned all the different teleconferencing tools and they've all 0:04:06.840 --> 0:04:10.000 worked reasonably well for us. So I think, you know, 0:04:10.040 --> 0:04:13.360 we learned things there that we have the ability to 0:04:13.360 --> 0:04:15.280 to stay connected. I think the other thing though, that 0:04:15.320 --> 0:04:19.920 it highlighted for US is um we ultimately are an 0:04:19.960 --> 0:04:22.680 in person business. We're in person in the restaurants, were 0:04:22.720 --> 0:04:26.159 in person in the office, and so well, you lose 0:04:26.240 --> 0:04:29.640 something from culture, you lose something from a connectedness by 0:04:29.640 --> 0:04:32.599 by being so remote and so, you know, while it 0:04:32.640 --> 0:04:35.760 worked well for the time, we're committed to getting back 0:04:35.760 --> 0:04:38.600 into our offices, getting back into the restaurants. And one 0:04:38.600 --> 0:04:40.760 of the problems I think some of the franchises are having, 0:04:40.760 --> 0:04:43.320 not just McDonald's, getting people to come back to work. 0:04:43.360 --> 0:04:44.920 Either they don't want to come back to work, or 0:04:45.000 --> 0:04:47.120 they for health or other reasons, or they want to 0:04:47.200 --> 0:04:49.120 hire a compensation, and they often get at the kind 0:04:49.120 --> 0:04:51.159 of starting jobs you might have. How hard has it 0:04:51.200 --> 0:04:53.400 been to get people to come back to work. It 0:04:53.480 --> 0:04:56.440 has been very challenging in the US. We have not 0:04:56.680 --> 0:05:00.360 seen that issue as pronounced in Europe barrel swear on 0:05:00.440 --> 0:05:02.440 the world, but in the US it certainly has been 0:05:02.440 --> 0:05:05.760 a challenge. I think it's a lot of different factors 0:05:05.760 --> 0:05:09.279 in it. Certainly the stimulus UH support had some element. 0:05:09.320 --> 0:05:11.440 But you know, if I asked the franchise ease, okay, 0:05:11.520 --> 0:05:14.480 so September, is everything gonna be good? Once the stimulus 0:05:14.560 --> 0:05:16.479 rolls off the like will know there are other things 0:05:16.520 --> 0:05:18.880 going on, so I think, you know, there's a variety 0:05:18.920 --> 0:05:21.880 of things that play. But it has certainly been a 0:05:21.960 --> 0:05:24.760 challenge for us on staffing at the restaurants, and it's 0:05:24.760 --> 0:05:26.960 putting pressure on wages, which is what you see in 0:05:27.080 --> 0:05:30.560 you know, any kind of capitalist system. UM, So employers 0:05:30.600 --> 0:05:33.320 like McDonald's are now having to pay more on wages. 0:05:33.400 --> 0:05:36.560 We announced in our company owned restaurants, UH sort of 0:05:36.560 --> 0:05:40.640 a across the board minimum ten percent wage increase. UH 0:05:40.720 --> 0:05:43.599 that has been carried forward by many of our franchise 0:05:43.600 --> 0:05:46.200 ease and I think we're just having to get creative 0:05:46.440 --> 0:05:49.640 about how do we get people uh to come and 0:05:49.720 --> 0:05:52.520 interview for a job at McDonald's. And you're seeing our 0:05:52.560 --> 0:05:55.760 franchise ease do things like, hey, you know, fifty dollars 0:05:55.760 --> 0:06:00.120 for an interview or free iPhone after ninety day is 0:06:00.160 --> 0:06:02.440 I mean, that's sort of all the things that we're 0:06:02.440 --> 0:06:04.040 having to come up with right now to make sure 0:06:04.040 --> 0:06:06.119 we can staff the restaurants. But most of the people 0:06:06.120 --> 0:06:08.160 who are young who do work at McDonald's, are they 0:06:08.200 --> 0:06:10.800 minimum wage people and they go up from minimum wage 0:06:10.880 --> 0:06:14.159 or are you above the minimum wage? The legal minimum wage. Now, yeah, 0:06:14.160 --> 0:06:16.680 we're above the legal minimum wage, so it's seven and 0:06:16.720 --> 0:06:20.920 a quarter. Uh. And there are very few places these 0:06:21.000 --> 0:06:23.960 days that you can be competitive in the marketplace paying 0:06:24.040 --> 0:06:27.400 the federal minimum wage. I think from our vantage point, 0:06:27.400 --> 0:06:30.359 what we announced in our company owned restaurants is eleven 0:06:30.440 --> 0:06:33.560 dollars is the starting wage, and then you know, as 0:06:33.560 --> 0:06:35.960 you move up, you would you quickly progress through that. 0:06:36.040 --> 0:06:39.320 If you are a restaurant manager, someone who's maybe been 0:06:39.360 --> 0:06:41.360 there for a couple of years, you're earning anywhere from 0:06:41.360 --> 0:06:44.080 fifteen to twenty dollars an hour, and I think that's 0:06:44.120 --> 0:06:47.280 been largely Um. You're seeing a similar type of thing 0:06:47.320 --> 0:06:51.400 with our franchise. So while we don't collect information around 0:06:51.440 --> 0:06:55.279 what is you know, the average wage paid by our franchisees, 0:06:55.920 --> 0:06:59.200 I would expect it's probably about ten dollars that we're 0:06:59.240 --> 0:07:03.600 paying right now, just because again, the marketplace is driving it. Uh. 0:07:03.640 --> 0:07:05.520 And I think that's always been one of the questions, 0:07:05.640 --> 0:07:07.400 is you know, is this something that you want to 0:07:07.400 --> 0:07:10.800 be legislated or wanted to be in the marketplace. Our 0:07:10.920 --> 0:07:14.000 view is, um, we're gonna do whatever we need to 0:07:14.120 --> 0:07:16.679 be successful as a business, but we also don't oppose 0:07:17.120 --> 0:07:21.080 if the federal minimum wage is addressed either. So during 0:07:21.120 --> 0:07:23.600 COVID there were some problems. You had some franchise I 0:07:23.600 --> 0:07:26.559 guess where there were some strikes or something. Employees weren't happy. 0:07:26.560 --> 0:07:29.720 What was that all about? We always have something going 0:07:29.720 --> 0:07:33.200 on at McDonald's around the world there, certainly, I think 0:07:33.200 --> 0:07:36.680 what you're referencing. There were um some protests about either 0:07:36.840 --> 0:07:40.920 were were doing enough to protect essential workers? Um, which 0:07:40.960 --> 0:07:43.600 is you know how we were deemed as a business. 0:07:44.360 --> 0:07:46.280 We went to a lot of effort there to make 0:07:46.320 --> 0:07:49.120 sure that we provided ppe into other things like social 0:07:49.160 --> 0:07:52.160 distancing the restaurant, but we had protests on that. Well, 0:07:52.200 --> 0:07:56.040 we'll get protests around wage rates. Um, that will crop up. 0:07:56.120 --> 0:07:59.640 So the thing about McDonald's is, no matter what has 0:07:59.680 --> 0:08:03.160 happened in society, you can be certain it has some 0:08:03.200 --> 0:08:07.040 permutation that affects McDonald's. And it's both the challenge of 0:08:07.040 --> 0:08:09.400 the job but also what's interesting about it. Let's talk 0:08:09.440 --> 0:08:12.640 about the major things on your menu, which I've sampled 0:08:12.680 --> 0:08:15.920 over the years. Of course, Um, so the most popular 0:08:15.960 --> 0:08:18.040 thing that you have on your menu, is it a 0:08:18.120 --> 0:08:21.400 big mac or a quarter pounder or the French fries? Well, 0:08:21.440 --> 0:08:24.400 I mean from a volume standpoint, the fries are by 0:08:24.480 --> 0:08:28.840 far the biggest within sandwiches, probably the Big Mac. It 0:08:28.920 --> 0:08:30.920 does vary a little bit around the world, but but 0:08:31.000 --> 0:08:34.160 the Big Mac is probably up there well. The fries 0:08:34.280 --> 0:08:39.400 are intoxicating, lee difficult to avoid eating one. Can you 0:08:39.440 --> 0:08:41.400 tell us what's the secret? What do you put in 0:08:41.440 --> 0:08:45.040 the in the batter or the cooking oil or whatever 0:08:45.080 --> 0:08:47.280 you do that is the secret? Is it the potatoes? 0:08:47.320 --> 0:08:49.360 What is it? We have a room here that I 0:08:49.400 --> 0:08:51.599 haven't taken you too that has all the secrets on that. 0:08:51.720 --> 0:08:53.920 But I would just say there's there's a lot of 0:08:53.960 --> 0:08:57.560 things that go into it. It's starting with, um, you 0:08:57.600 --> 0:08:59.600 know where we get the potatoes from, and we have 0:09:00.080 --> 0:09:05.520 proprietary relationships with that, how those potatoes are then processed, Uh, 0:09:05.559 --> 0:09:08.080 what we will put on those potatoes, and then ultimately 0:09:08.080 --> 0:09:11.360 how they're cooked in the restaurant, the cooking oil that 0:09:11.400 --> 0:09:13.600 we use, the amount of salt that we use. So 0:09:14.240 --> 0:09:17.320 there's a lot of things that go into the secret recipe. 0:09:17.480 --> 0:09:19.640 Some people might say the French fries might not be 0:09:19.720 --> 0:09:21.719 that healthy. Some people might say that, I don't know. 0:09:21.760 --> 0:09:24.240 If you would say that, um, what would you say 0:09:24.240 --> 0:09:26.160 about that? I'd say, you know what we try to 0:09:26.200 --> 0:09:28.400 do on our menu is to have choice. So we 0:09:28.480 --> 0:09:31.320 have a variety of things on our menu, from more 0:09:31.360 --> 0:09:35.280 indulge in items to healthier items. And you know, it's 0:09:35.320 --> 0:09:37.600 no different than if you go to the grocery store. 0:09:37.640 --> 0:09:39.000 You can go to the salad bar, or you can 0:09:39.000 --> 0:09:41.800 go to the ice cream section. And that's how we 0:09:41.840 --> 0:09:45.200 approach our restaurant, which is about choice. The other thing, though, 0:09:45.679 --> 0:09:47.240 you know, I get asked a lot of times, why 0:09:47.280 --> 0:09:48.960 don't you have more of this? Why don't you have 0:09:49.040 --> 0:09:51.840 more of that? Or why did you get rid of this? Um, 0:09:51.880 --> 0:09:55.560 it all comes down to did itsell. So our restaurant 0:09:55.960 --> 0:09:58.120 and what goes on the menu is all based on 0:09:58.320 --> 0:10:01.160 what moves gets on the menu, what doesn't move comes 0:10:01.160 --> 0:10:04.480 off the menu, and so ultimately we're letting the customer 0:10:04.559 --> 0:10:06.600 decide what we do or don't carry on the menu. 0:10:06.880 --> 0:10:09.800 Since McDonald's was started some sixty plus years ago or so, 0:10:10.200 --> 0:10:12.080 there's been a greater interest in the United States and 0:10:12.080 --> 0:10:14.800 maybe around the world healthier eating. Have you tried to 0:10:14.800 --> 0:10:18.480 reflect that in your menu? We've tried, um, And I 0:10:18.480 --> 0:10:21.280 would say, you know, it gets back to again, what 0:10:21.280 --> 0:10:24.319 what sells gets on the menu and stays on the menu. 0:10:25.679 --> 0:10:28.560 What we have seen consistently is, as we've tried to 0:10:29.000 --> 0:10:32.440 broaden UH more of what you know, people might say 0:10:32.440 --> 0:10:35.560 are better for you items, uh, there's just not as 0:10:35.559 --> 0:10:37.600 strong a demand for them as there are for some 0:10:37.679 --> 0:10:40.760 of our iconic classics. And so you know, we're not 0:10:40.840 --> 0:10:42.800 in the business of telling people what they should or 0:10:42.800 --> 0:10:46.320 shouldn't eat. Our view as our obligation is to provide 0:10:46.320 --> 0:10:49.840 them with total transparency and nutritional information to make sure 0:10:49.840 --> 0:10:52.360 that we afford them choice. But ultimately what the consumer 0:10:52.400 --> 0:10:55.199 buys is up to them. Suppose I'm a vegetarian or 0:10:55.240 --> 0:10:57.160 a vegan and i want to go to McDonald's, is 0:10:57.160 --> 0:10:59.480 there anything there for me there? So you could certainly 0:10:59.520 --> 0:11:03.079 have UM right now a salad UH in a restaurant. 0:11:03.360 --> 0:11:06.800 Depending on if you're vegetarian or vegan vegetarian, they're going 0:11:06.840 --> 0:11:09.600 to be other offerings that you have. If you're in India, 0:11:09.640 --> 0:11:14.240 for example, we have quite a broad sample of vegetarian 0:11:14.360 --> 0:11:17.800 menu items, less so if you're in Lubbock, Texas, for example. 0:11:18.360 --> 0:11:21.080 Uh So, again it depends on the customer and what 0:11:21.160 --> 0:11:25.559 the customer wants. But we've also talked about launching mcplant 0:11:25.880 --> 0:11:28.800 UH and mcplant for us as a plant based burger. 0:11:29.360 --> 0:11:32.959 Uh that is available in some countries already. Uh, it's 0:11:33.040 --> 0:11:36.400 something that we're gonna be testing later in the U s. So, uh, 0:11:36.440 --> 0:11:38.880 maybe we'll get you a mcplant Another product I don't 0:11:38.880 --> 0:11:41.920 want to overlook as your famous Coca cola. Now, you 0:11:42.000 --> 0:11:44.760 used to work at Pepsi. I know, so to Pepsi 0:11:44.800 --> 0:11:46.480 people ever call you to remind you that you have 0:11:46.520 --> 0:11:49.400 coke and maybe you should be had a few dialogue 0:11:49.960 --> 0:11:51.960 over the over the years, and you know, my my 0:11:52.040 --> 0:11:56.120 short answer is the way to get pepsi into McDonald's 0:11:56.120 --> 0:11:58.960 is get people to prefer pepsi over coke. Back to 0:11:59.559 --> 0:12:02.320 the point of we're gonna sell whatever the customer wants. UM. 0:12:02.480 --> 0:12:05.800 So yes, my my pepsi friends periodically check in. But 0:12:05.920 --> 0:12:08.559 some people say that your coca cola is made in 0:12:08.559 --> 0:12:10.719 a certain way that's better than the coca cola could 0:12:10.720 --> 0:12:12.120 buy in the bottle. So what is it that you 0:12:12.160 --> 0:12:14.600 do that's different with your coca cola? So I would agree, 0:12:14.640 --> 0:12:16.920 I think it's better. Um. One of the things that 0:12:16.960 --> 0:12:19.800 we have as an advantage is because of the volumes 0:12:19.800 --> 0:12:23.080 that we do in our restaurant, um our volumes tend 0:12:23.080 --> 0:12:25.600 to be higher than than anybody else out there. It 0:12:25.640 --> 0:12:29.760 allows us to buy equipment that is able to be 0:12:29.920 --> 0:12:33.760 tight traded or calibrated more precisely than maybe some of 0:12:33.760 --> 0:12:36.800 our competitors. And so what we're able to do because 0:12:36.840 --> 0:12:38.599 of the equipment that we're able to buy, which is 0:12:38.640 --> 0:12:42.160 more expensive equipment, is we're able to deliver what Coke 0:12:42.200 --> 0:12:45.520 would describe as their gold standard product on a more 0:12:45.559 --> 0:12:49.160 consistent basis than somebody who maybe has inferior equipment in 0:12:49.200 --> 0:12:52.640 their restaurant. So I should disclose that I am an 0:12:52.640 --> 0:12:56.880 investor in McDonald's in effect because my firm bought a 0:12:56.880 --> 0:13:00.160 piece of the China business with a Chinese partner and 0:13:00.240 --> 0:13:04.640 with McDonald's UM and in China, as I understand that, uh, 0:13:04.880 --> 0:13:08.240 chicken is very popular, maybe more so than beef. Is 0:13:08.240 --> 0:13:10.640 that unusual where chicken is more popular than beef and 0:13:10.760 --> 0:13:13.760 in a given market, Uh, you know, China is largely 0:13:13.800 --> 0:13:16.560 a chicken market. I think this is one of those things. 0:13:16.679 --> 0:13:19.320 It does vary depending on which part of the world 0:13:19.320 --> 0:13:21.760 you're in. Brazil tends to be more of a beef market. 0:13:22.360 --> 0:13:25.679 US is about fifty fifty between chicken and beef. So, 0:13:26.240 --> 0:13:29.160 you know, we do see that the trends evolving, but 0:13:29.280 --> 0:13:32.960 chicken globally is growing faster than beef, and certainly our 0:13:33.080 --> 0:13:36.320 expectation over the next five years is that chicken, more 0:13:36.360 --> 0:13:38.959 so than beef, will be the dominant protein in our restaurants. 0:13:39.160 --> 0:13:41.600 So there are four ways you can buy things at McDonald's, 0:13:41.600 --> 0:13:43.760 as I understand, each begin with a D. So let's 0:13:44.559 --> 0:13:47.559 go go through. That one is a drive through? Is 0:13:47.600 --> 0:13:50.199 that a big business these days? Drive through drive to you, 0:13:50.200 --> 0:13:52.480 it's a huge business for us, particularly in the US. 0:13:52.679 --> 0:13:56.360 It's about seventy of the business in the US. In 0:13:56.440 --> 0:13:58.520 Europe you would see at the inverse you would see 0:13:58.559 --> 0:14:00.600 dining and being a much bigger part of the business 0:14:00.640 --> 0:14:03.240 in Europe, but through the pandemic we did see drive 0:14:03.280 --> 0:14:06.120 through also become a pretty significant part of the business. 0:14:06.480 --> 0:14:09.640 Another D is delivery. You have ability to deliver? Do 0:14:09.640 --> 0:14:11.840 you deliver yourself? Do you use one of the services 0:14:11.960 --> 0:14:15.679 deliver people's home? We do both. It started for us 0:14:15.679 --> 0:14:19.040 in Asia where we were doing our own delivery, particularly 0:14:19.040 --> 0:14:22.440 in China. In the Middle East, we also have a 0:14:22.480 --> 0:14:26.200 pretty sizeable delivery business where we do the delivery ourselves. 0:14:26.240 --> 0:14:27.920 And then in other parts of the world, like in 0:14:27.960 --> 0:14:31.720 the US, we have partnered with third party operators like 0:14:31.760 --> 0:14:34.480 an Uber eats or a door dash. So right now 0:14:34.520 --> 0:14:37.120 we do about six billion dollars of sales a year 0:14:37.560 --> 0:14:42.320 through delivery, which is growing, you know, high teens globally. 0:14:42.320 --> 0:14:45.320 It's it's been pretty remarkable. Another day is digital. You 0:14:45.360 --> 0:14:48.480 can buy things digitally? How do you do that? So 0:14:48.560 --> 0:14:51.720 the app? For us, everything is moving to the app. 0:14:51.760 --> 0:14:53.880 I think for us it's been it's been an interesting 0:14:53.920 --> 0:14:57.400 evolution to see where you know, for years and years 0:14:57.440 --> 0:14:59.440 the center of the relationship that we had with the 0:14:59.480 --> 0:15:02.680 customer in the physical restaurant, and what we're seeing, particularly 0:15:02.680 --> 0:15:06.400 with gen Z and millennials, is it's moving to much 0:15:06.400 --> 0:15:09.440 more of a digital relationship through the app. So yes, 0:15:09.480 --> 0:15:12.960 today UH in almost every single one of our countries, 0:15:13.360 --> 0:15:16.040 the US being a prime example of that. You can 0:15:16.080 --> 0:15:19.800 download the McDonald's app, you can order your products through 0:15:19.800 --> 0:15:22.440 the app and UH. An exciting thing we're doing right 0:15:22.480 --> 0:15:25.320 now this month is we're rolling out loyalty, So when 0:15:25.360 --> 0:15:28.480 you buy with the app, you also get loyalty points 0:15:28.560 --> 0:15:31.080 you can redeem later for food and other benefits. It's 0:15:31.120 --> 0:15:33.920 your frequent flyer version. You got it. So and the 0:15:34.040 --> 0:15:36.400 last d is dying in which used to be the 0:15:36.440 --> 0:15:38.760 thing that people did. But now is that a smaller 0:15:38.800 --> 0:15:40.720 and smaller part of your business and you need all 0:15:40.720 --> 0:15:44.760 those spaces anymore in your restaurants. It's I think still 0:15:44.880 --> 0:15:47.920 a really important part of our business because a lot 0:15:48.000 --> 0:15:51.600 of the interaction and the memories that people form about 0:15:51.680 --> 0:15:54.560 McDonald's comes from the dying in experience. But I think 0:15:54.600 --> 0:15:58.880 you're right in recognizing that it is certainly, through the pandemic, 0:15:59.240 --> 0:16:01.920 a less prov part of the business. I mean, our 0:16:02.000 --> 0:16:04.880 view is that it is going to come back. Um. 0:16:04.920 --> 0:16:08.160 I think dining and eating is such a social experience. 0:16:08.600 --> 0:16:10.880 There's always going to be an element of it that 0:16:10.960 --> 0:16:13.120 is in person. Now, how much of it comes back, 0:16:13.560 --> 0:16:15.400 time will tell. And if at some point, you know, 0:16:15.440 --> 0:16:19.760 maybe we need to reduce the space for dining seating 0:16:19.800 --> 0:16:21.760 that we have in our restaurants, we can always calibrate 0:16:21.800 --> 0:16:23.840 and do that, But for now we're kind of on 0:16:23.880 --> 0:16:25.960 a watch and c mode. I assume you have a 0:16:26.000 --> 0:16:28.120 lot of people saying the food isn't as healthy as 0:16:28.320 --> 0:16:30.320 they might want it to be. Is that the biggest 0:16:30.360 --> 0:16:32.760 challenge or just growing the company? Ray Kroc had a 0:16:32.800 --> 0:16:36.000 famous line that gets quoted around here fairly off and 0:16:36.040 --> 0:16:38.600 even today, which is if you're not green and growing 0:16:38.600 --> 0:16:41.000 your red and rotten. Let's talk about your background. Where 0:16:41.040 --> 0:16:43.760 did you grow up? So? I was born in Boston, 0:16:44.280 --> 0:16:47.200 grew up on the East Coast until we started moving around. 0:16:47.400 --> 0:16:50.160 I went to high school in Cincinnati, uh, and then 0:16:50.240 --> 0:16:52.800 ultimately went to college down in North Carolina. Well, you 0:16:52.840 --> 0:16:54.680 can say the name, it's I went to do Yes, 0:16:54.760 --> 0:16:57.840 we shared that. And after you graduated, what did you do? 0:16:58.640 --> 0:17:01.320 I went to Procker and Gamble. I went into their 0:17:01.400 --> 0:17:05.120 band brand management program at the headquarters in Cincinnati. And 0:17:05.160 --> 0:17:08.040 after that, so after that, I went to Harvard Business 0:17:08.040 --> 0:17:11.120 School UM and got my m b a UM, and 0:17:11.240 --> 0:17:13.480 after that I went into consulting for a few years. 0:17:13.600 --> 0:17:15.080 But you spent a lot of time in the food 0:17:15.119 --> 0:17:18.280 world because you were before PEPSI, you were you were 0:17:18.320 --> 0:17:21.000 after after PEPSI were a craft as That's right. So 0:17:21.160 --> 0:17:23.479 just something about food that you really appeal to you, 0:17:23.880 --> 0:17:27.000 I'd say what I love is being in consumer industries. UH. 0:17:27.280 --> 0:17:30.919 For me, what I really find sort of energizing as 0:17:30.960 --> 0:17:35.520 having a tangible product that I can see, touch, feel, etcetera. UM, 0:17:35.640 --> 0:17:38.239 and also one that you know people can relate to 0:17:38.400 --> 0:17:40.879 when I say, you know, I work at PEPSI, or 0:17:40.920 --> 0:17:44.480 I work at craft or I work at McDonald's. Um, 0:17:44.520 --> 0:17:47.359 immediately you can always have a conversation with people and 0:17:47.560 --> 0:17:49.440 kind of the fun thing for me and my current job. 0:17:49.960 --> 0:17:53.200 You know, no matter where I am in the world, UM, 0:17:53.400 --> 0:17:56.080 people have an opinion about McDonald's and want to talk 0:17:56.119 --> 0:17:57.840 to you about McDonald's, and it just it makes the 0:17:57.920 --> 0:18:01.159 job fun. So you came here, and that here was 0:18:01.200 --> 0:18:04.640 here in Okay, and then you rose up pretty quickly 0:18:04.640 --> 0:18:06.920 to become the head of America's that's right. And then 0:18:06.960 --> 0:18:09.880 in two thousand nineteen you became the CEO. That's right. 0:18:10.240 --> 0:18:12.040 And the stock is up and the market cap is 0:18:12.080 --> 0:18:15.119 up about since then. So I assume your board is happy. 0:18:15.840 --> 0:18:18.440 So far, so good. Yeah, but some of your predecessors 0:18:18.440 --> 0:18:20.560 had problems. They didn't last that long and for health 0:18:20.640 --> 0:18:22.600 or other reasons. So is there a bad karma you 0:18:22.640 --> 0:18:24.640 feel to being CEO or you think you can outlive 0:18:25.160 --> 0:18:27.239 the bad karma? Yeah? I hope not. I try not 0:18:27.320 --> 0:18:30.199 to think about it too much actually, UM. But you know, 0:18:30.480 --> 0:18:33.919 I think when you're in these jobs, you know, you're 0:18:34.160 --> 0:18:36.840 you're just very grateful for the time that you're in 0:18:36.880 --> 0:18:39.080 the role. And I don't spend a whole lot of 0:18:39.080 --> 0:18:43.879 time thinking about you know, sort of you know, the 0:18:43.920 --> 0:18:46.080 future and all that stuff. It's it's about you know, 0:18:46.119 --> 0:18:48.879 so long as I keep delivering for the company, us, 0:18:49.000 --> 0:18:52.040 long as we keep performing. Um. I certainly, you know, 0:18:52.080 --> 0:18:54.040 feel really fortunate to be in the role that I'm in. 0:18:54.400 --> 0:18:57.359 So it's a global company. UM now that COVID is 0:18:57.560 --> 0:19:00.719 not behind us, but certainly receiving a bit. Are you 0:19:00.880 --> 0:19:02.920 traveling the world? Are you expect to travel the world 0:19:03.000 --> 0:19:07.000 war I do expect to travel starting next month. Uh, 0:19:07.040 --> 0:19:09.560 and you know, between now and the end of the year, 0:19:09.600 --> 0:19:12.919 I've got five international trips lined up. Are when you 0:19:13.000 --> 0:19:15.840 travel internationally, you're trying to tell the local franchises to 0:19:15.880 --> 0:19:18.359 do work more, do better job? Or what are you 0:19:18.359 --> 0:19:21.080 trying to do when you travel you're recruiting it franchisees 0:19:21.200 --> 0:19:22.840 or are you telling them why your new food products 0:19:22.840 --> 0:19:24.640 are going to be good or why Yeah, there there's 0:19:24.680 --> 0:19:26.720 a variety of things I'm trying to get done. When 0:19:26.840 --> 0:19:29.680 when I'm out there, the biggest thing is listening, so 0:19:30.320 --> 0:19:33.040 you know, hearing what's on the mind of our franchisees, 0:19:33.119 --> 0:19:35.160 hearing what's on the mind of our people. That's one 0:19:35.200 --> 0:19:38.720 thing I'm looking at the second is making sure that 0:19:38.840 --> 0:19:41.680 the strategies that we're talking about at a corporate level 0:19:42.119 --> 0:19:44.880 are they cascading down and we're seeing those in the restaurants. 0:19:44.920 --> 0:19:47.120 A lot of times, what can happen is you think 0:19:47.160 --> 0:19:49.680 you've got clarity around what the strategy is and then 0:19:49.680 --> 0:19:52.600 it doesn't actually end up getting executed. So I'm looking 0:19:52.600 --> 0:19:55.040 at the connection between our strategy and is it showing 0:19:55.119 --> 0:19:58.080 up in the execution the restaurant. I also will just 0:19:58.119 --> 0:20:01.119 spend time being a little bit of a cheerleader. Um 0:20:01.160 --> 0:20:03.880 when I go into the restaurant. As you would imagine 0:20:03.960 --> 0:20:08.040