MCDONALD'S is a real estate company

a) People think McDonald's as World's largest fast-food chains

b) But McDonald's is a real estate empire hidden under the face of a fast-food chain

c) Instead of opening McDonald's outlets on its own, the company gives access to its menu, branding, and operational infrastructure to anyone interested in running an outlet for them

d) McDonald's makes most of its money by buying out the outlet location and renting them to franchisees

e) McDonald's ensures that franchise owners are:

✅paying $45,000 fees to start a franchise

✅pay a rental cost of 10.7% of the restaurant's sales with 20-year terms on rental agreements

✅pay a monthly royalty fee of 4% of gross sales

f) Franchise owners happily pay the money to buy the rights to McDonald's branding because it gets people through the doors

g) The advantage of this model is that revenue stream (Rent and Royalty income received from franchisees) is far more stable

-Prathamesh Kakaria