US fastfood giant McDonald’s has announced that it is to sell Donatos Pizzeria back to its founder as part of the hamburger chain’s revitalisation plan.
As part of its objective to “do fewer things better to drive long-term growth in sales and operating income”, McDonald’s will also significantly narrow its non-McDonald’s brand activity by focusing on the US development of Chipotle and Boston Market, concepts that are operating profitably.
As well as selling Donatos, McDonald’s also plans to discontinue its development of non-McDonald’s brands outside the US.
“This decision – affecting Boston Market in Canada and Australia, and Donatos Pizzeria in Germany – reflects management’s desire to remain sharply focused on revitalising sales and service at McDonald’s 17,000 restaurants outside the US,” the company said.
McDonald’s will retain its minority investment in Pret A Manger, but McDonald’s Japan will close its Pret units there, as previously announced, the company added.
McDonald’s has also entered into a letter of intent to exit its domestic joint venture with Fazoli’s.
Jim Cantalupo, McDonald’s chairman and CEO, said these decisions will achieve several objectives, including “eliminating distracting and unprofitable operations”, reallocating resources to McDonald’s restaurants, and providing a more focused growth platform for Chipotle and Boston Market.
“We will begin 2004 with a clear direction for what we need to do with these brands. We will concentrate our efforts primarily on Chipotle and Boston Market in the United States, concepts that have potential for long-term growth and benefit to McDonald’s,” Cantalupo said.