McDonald’s Closing 200 US Locations Amid Coronavirus Pandemic

by Jacklyn Krol
McDonalds to close 200 locations amid coronavirus pandemic

McDonald’s will be closing 200 of its locations in the United States amid the coronavirus (COVID-19) pandemic. The fast-food giant’s sales dropped by 30 percent in their second-quarter global sales. The reason seems to stem from the pandemic’s safety protocols, as the company decided to serve only drive-through and delivery.

McDonald’s Sales

The Daily Mail reported that the company “suffered a 68 percent drop in profits to $483.8 million, following a 30 percent decline in revenues to $3.8 billion.” Overall, the United States accounts for more than a third of the company’s restaurants worldwide.

McDonald’s is now accelerating their closures of 200 locations, most of which are inside Walmarts. Restaurant sales fell 8.7%, although it was anticipating a 9.97 percent decrease. Overall, store sales fell 41% internationally as there were temporary restaurant closures across the globe due to safety protocol.

As of now, 96 percent of McDonald’s locations are now open out of the 39,000 locations. At the beginning of the second quarter, only 75 percent of stores were in operation, and in return from a 39 percent decrease in April, it was only at a 12 percent decrease by June.

McDonald’s Response

‘Our strong drive-thru presence and the investments we’ve made in delivery and digital over the past few years have served us well through these uncertain times,’ Chief Executive Officer Chris Kempczinski told the outlet.

McDonald’s opened up their dining rooms at 2,000 locations with reduced seatings before they paused reopenings due to the surge in cases. The company is requiring all patrons and employees to wear face coverings. McDonald’s told media outlets that it will not be opening the dining rooms for at least another month.

The company has taken a number of safety measures including increased cleaning. They have also trained their employees about social distancing and sanitizing procedures. The company has also shut down all of its PlayPlace areas where children normally play in.

Corporate spent over $200 million in franchisee’ marketing during the second quarter. They also paid $45 million in franchisees’ debt and $31 million to distribution centers, a fee normally paid by the franchise.

Outsider.com