MCDOCI-1007528,
MCDOCH907528 ,
Case 3:14-cv-02098-JD Document 271-11 Filed 08/17/15 Page 3 of 28
3.
Franchising Standards
National Franchising
revised National
applying the
begin applying
McDonald’s begin
will McDonald's
When will
the revised
Standards and
and the
the
guidelines?
and guidelines?
tools and
measurement tools
revised measurement
revised
Reviews taking
Franchising Standards
National Franchising
The revised National
Standards will
will be
be used
used for
for all
all Business
Business Reviews
taking place
place
and
for
prepare
to
System
the
for
time
ample
allow
will
This
2014.
after April
after
April 1,
1, 2014. This will allow ample time for the System to prepare for and understand
understand
and
If there
Standards. If
revisions to the Standards.
the revisions
there are
are situations
situations where
where the
the measurements
measurements and
in aa
result in
Standards result
Franchising Standards
NationalFranchising
revisedNational
therevised
withthe
associatedwith
guidelines associated
Owner/Operator previously
ineligibility where
of ineligibility
determination of
where the
the Owner/Operator
previously would
would have
have been
been
eligible for growth
considered eligible
growth and
and rewrite,
rewrite, there
there will
will be
be communication
communication with
with the
the
rewrite
and rewrite
for growth
ineligible for
becoming ineligible
Owner/Operator becoming
prior to
Owner/Operator prior
to the
the Owner/Operator
growth and
compliance.
timing of
and timing
regarding the
regarding
the expectations and
of compliance.
4.
4.
Franchising
National Franchising
theNational
of the
six of
all six
meet all
to meet
have to
organization have
Owner/Operator’s organization
an Owner/Operator's
Does an
Does
certain
in certain
participate in
to participate
eligible to
be eligible
and to
rewrite and
for growth,
eligible for
be eligible
Standards to be
growth, rewrite
to be
programs and
programs
and incentives?
incentives?
McDonald’s System.
Standard isis critically
Each Standard
Yes. Each
Yes.
criticallyimportant
importantto
tothe
the success
success of
of the
the McDonald's
System.
Franchise
the Franchise
with the
compliance
in
be
and
Standard and be in compliance with
each Standard
meet each
must meet
Owner/Operators must
participate
to participate
eligible
be
to
and
rewrite
and
growth
for
eligible
considered eligible for growth and rewrite and to be eligible to
be considered
to be
Agreement to
MRP?
like
programs
about
specific
be
to
need
we
Do
incentives.
and
programs
in certain programs and incentives. Do we need to be specific about programs like MRP?
in
Rebuild?
National
relative to
Owner/Operator’s status
an Owner/Operator's
communicate an
McDonald’s communicate
willMcDonald's
Howwill
5. How
S.
status relative
to the
the National
Franchising
Franchising Standards?
Owner/Operator organization
Generally, each Owner/Operator
Generally,
organization will
will receive
receive aa Business
Business Review
Review at
at least
least every
every
and
growth and
for growth
ineligible for
is ineligible
that is
organization that
Owner/Operator organization
any Owner/Operator
Generally, any
18 months. Generally,
Region will
The Region
will receive aa Business
rewrite will
Business Review
Review every
every 12
12 months.
months. The
will evaluate
evaluate the
the
and guidelines
Owner/Operator’s performance
Owner/Operator's
performance relative
relativeto
tothe
the measurements
measurements and
guidelines of
of each
each
Regional Management
Review, Regional
Business Review,
During the
Standard. During
Standard.
the Business
Management will
will communicate
communicate the
the
rewrite.
and rewrite.
for growth
eligibility status
Owner/Operator’s eligibility
Owner/Operator's
status for
growth and
updating their
Review updating
Interim Business
an Interim
In addition,
In
addition, an
an Owner/Operator
Owner/Operator may
may receive
receive an
Business Review
their
meeting
not
is
organization
the
that
apparent
becomes
it
eligibility status
eligibility
status ifif it becomes apparent that the organization is not meeting or
or now
now meets
meets aa
Standard.
6.
6.
a
Q.SC VP
the QSC
If
an Owner/Operator
Owner/Operator disagrees with
with the
VPon
onwhether
whetherthe
the organization
organization meets
meets a
if an
Standard, what
Standard,
what are
are his/her
his/her options?
options?
McDonald’s, our
within McDonald's,
disputes within
and disputes
As with
As
with all
all issues and
our “open
"open door”
door" policy
policy (e.g.,
(e.g., appealing
appealing to
to
apply.
would apply.
McDonald’s management)
of McDonald's
higher levels
or higher
Ombudsman or
the Ombudsman
the
levels of
management) would
7.
7.
franchise
term franchise
Under what
Under
what circumstances
circumstances could
could an
an Owner/Operator
Owner/Operator not
not be
be offered
offered aa new
new term
for growth
eligible for
is eligible
Owner/Operator is
the Owner/Operator
(rewrite) even though the
growth and
and rewrite?
rewrite?
Typically, this
Typically,
thiswould
would only
onlyoccur
occurififthe
the restaurant
restaurantwas
wasclosing
closingdue
dueto
to aa lack
lackof
of real
realestate
estate
area.
trading area.
the trading
in the
changes in
or changes
tenure or
tenure
Oneratlons
Operations
Individual
an individual
at an
visits at
ROIP visits
gradedROIP
measuredgraded
onlymeasured
Standardonly
OperationsStandard
theOperations
Previously,the
1. Previously,
ROIP visits
gradedROIP
forgraded
addedfor
beenadded
measurement been
has aa new
Why has
level. Why
restaurant level.
new measurement
visits at
at the
the
Owner/Operator organization
organization level
level as
as well?
well?
2
2
HIGHLY CONFIDENTIAL
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The changes
the Operations
Operations Standard
The
changes to
to the
Standardare
areintended
intendedto
to demonstrate
demonstrate our
our commitment
commitment to
to
our guests
by delivering
delivering the
the highest
highest levels
levels of
ofQS&C
QS&C and
our
guests by
and Food
Food Safety,
Safety, while
while not
not deviating
deviating
from the
ROIP process.
from
the ROIP
process. We
We believe
believe that
that this
this Standard,
Standard, when
when measured
measured only
only at
at the
the
individual
restaurant
level,
does
not
adequately
assess
an
Owner/Operator’s
overall
individual restaurant level, does not adequately assess an Owner/Operator's overall
operational performance.
performance. Previously,
Previously, an
an organization
organization could
could fail
fail as
as many
many as
as 67%
67% of
operational
of their
their
graded
visits
in
an
ROIP
cycle,
and
yet
still
meet
the
Operations
Standard.
graded visits in an ROIP cycle, and yet still meet the Operations Standard.
We will
will continue
to use
useexisting
existingresources,
resources,including
includingFORs,
FORs, SORs
SORs and
Procedure
We
continue to
and Food
Food Safety
Safety Procedure
Verifications to
whether aa restaurant
restaurant and
and an
an Owner/Operator's
Owner/Operator’s organization
organization
Verifications
to determine
determine whether
meet the
the Operations
Operations Standard.
Standard. Please
Please refer
refer to
to the
theupdated
updated Operations
Operations Standard
Standard for
for details
details
meet
on the
the Organization
Organization measurement
as applied
applied to
Owner/Operator organizations
on
measurement as
to Owner/Operator
organizations with
with one,
one,
two, three,
three, four
four and
and five
five or
or more
more restaurants.
restaurants.
two,
2.
Does aa restaurant
restaurant that
audit meet
meet the
the Operations
Operations Standard?
Standard?
Does
that fails
fails only
only one
one food
food safety
safety audit
In most
However the
the severity
severity of
of the
the food
food safety
safety issues
issues may
may require
require aa different
different
In
most cases,
cases, yes.
yes. However
answer.
3.
An Owner/Operator
McDonald’s operational
An
Owner/Operator acquires
acquires aa restaurant
restaurantthat
that does
does not
not meet
meet McDonald's
operational
standards.
During
the
first
few
months
after
the
acquisition,
the
standards. During the first few months after the acquisition, the restaurant
restaurant receives
receives
graded visits
not meet
meet the
the Operations
Operations Standard.
Standard. How
How will
will this
graded
visits that
that do
do not
this impact
impact the
the
Owner/Operator’s eligibility
eligibility for growth
Owner/Operator's
growth and
and rewrite?
This situation
will be
be given
given aa
This
situation will
will not
not impact
impactthe
the Owner/Operator’s
Owner/Operator's status
status as
as he/she
he/she will
reasonable period
period of
raise that
The
reasonable
of time
time to
to raise
that restaurant’s
restaurant's operations
operationsto
to an
an acceptable
acceptable level.
level. The
appropriate time
should be
be discussed
discussed with
with the
theQSC
USC VP
acquisition.
appropriate
time frame
frame should
VPat
atthe
the time
time of
of the
the acquisition.
Please refer
refer to
to the
the QSC
USC playbook
information on
on graded
graded visits
visits occurring
occurring after
a
Please
playbook for
for more
more information
after a
change of
of ownership
ownership takes
takes place.
place.
change
4.
If an
meet the
the Operations
Operations Standard
Standard and
and
If
an Owner/Operator
Owner/Operator sells
sells aa restaurant
restaurant that
that does
does not
not meet
all of
other restaurants
restaurants in
in the
the organization
organization do
do meet
meet the
theNational
National Franchising
Franchising
all
of the
the other
Standards, is
Owner/Operator now
now eligible
eligible for
for growth
and rewrite?
Standards,
is the
the Owner/Operator
growth and
rewrite?
Assuming the
Owner/Operator’s organization
all the
National
Assuming
the Owner/Operator's
organization has
has consistently
consistently met
met all
the National
Franchising
Standards
at
their
remaining
restaurants,
the
Owner/Operator
Franchising Standards at their remaining restaurants, the Owner/Operator organization
organization
would
likely become
eligible for
for growth
growth and
and rewrite
rewrite upon
upon selling
selling its
its only
only restaurant
would likely
become eligible
restaurant in
in the
the
Improvement Process
Process for
for Underperforming
Underperforming Restaurants
Restaurants (IPUR).
(IPUR). However,
However, the
theQSC
USC VP
VP may
Improvement
may
not immediately
immediately support
support the
Owner/Operator’s growth
circumstances that
not
the Owner/Operator's
growth based
based on
on the
the circumstances
that
caused the
the sold
sold restaurant
restaurant to
to not
not meet
meet the
theOperations
Operations standard
standard in
in the
the first
first place.
place.
caused
5. IsIsan
anOwner/Operator
Owner/Operatoreligible
eligiblefor
forgrowth
growth and
and rewrite
rewrite once
once aa restaurant
restaurant is
is removed
removed from
from
S.
IPLIR and
normal ROIP
ROIP process?
IPUR
andplaced
placed back
back into
into the
the normal
process?
Depending on
facts and
and circumstances,
circumstances, some
Owner/Operators will
will be
eligible for
Depending
on the
the facts
some Owner/Operators
be eligible
for
growth and
and rewrite
rewrite immediately
immediately after
after coming
coming out
out of
ofIPUR.
IPUR. However,
growth
However, some
some
Owner/Operators may
eligible for
Owner/Operators
may not
not immediately
immediately become
become eligible
for growth
growth and
and rewrite
rewrite once
once the
the
restaurant is
is removed
removed from
from IPUR
IPUR and
back into
normal ROIP
ROIP process.
restaurant
and placed
placed back
into the
the normal
process. Rather,
Rather, the
the
organization must
all restaurants
organization
must demonstrate
demonstrate that
that it
it can
can operate
operate all
restaurants at
at aa level
levelthat
that meets
meets
McDonald’s USC
McDonald's
QSCstandards
standardsconsistently
consistently over
over aa period
period of
of time.
time.
If an
rewrite upon
upon coming
coming out
out of
ofIPUR,
IPUR, the
If
an Owner/Operator
Owner/Operator is
is not
not eligible
eligible for
for growth
growth and
and rewrite
the
USC VP
the organization
organization will
will
QSC
VPwill
willcommunicate
communicatethe
thetime
timeperiod,
period,up
upto
totwelve
twelve months,
months, that
that the
remain ineligible
If during
remain
ineligible for
for growth
growth and
and rewrite.
rewrite. If
during that
that time
time period,
period, the
the Owner/Operator
Owner/Operator
consistently meets
meetsall
allof
ofthe
theNational
NationalFranchising
Franchising Standards,
Standards, the
the organization
organization will
will regain
regain its
its
consistently
3
HIGHLY CONFIDENTIAL
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eligibility for
for growth
growth and
and rewrite
rewriteat
at the
the end
end of
of this
this time
time period.
period. Periodic
Periodic updates
updates regarding
regarding
eligibility
the organization's
organization’s status
status and
and the restaurant's
restaurant’s performance
performance against
against McDonald’s
the
McDonald's operational
operational
standards should
standards
should be
be communicated
communicated to
to the
the Owner/Operator
Owner/Operator while the organization remains
ineligible.
ineligible.
Reinvestment
i. Why
why is Reinvestment, which
which was
was previously
previously reviewed
reviewed as
asaa part
partof
ofthe
theFinancial
Financial Standard,
1.
now an
an Independent
Independent Standard?
Standard?
With Reinvestment
Reinvestment as
as an
an independent
independent standard,
standard,we
wewill
will be
be able
ableto
to better
better identify
identify
Owner/Operator
organizations
that
are
not
financially
viable,
rather
than
Owner/Operator organizations
viable,
than those
those that
that just
just fail
reinvest.
to reinvest.
2. Does every
every restaurant
restaurant in an Owner/Operator’s
2.
Owner/Operator's organization
organization have
have to
to meet the National
Restaurant Building and Equipment Standards (“NRBES”)
("NRBES")totomeet
meetthe
theReinvestment
Reinvestment
Standard?
Yes. However,
However, ifif one
one or
or more
more of
of an
an Owner/Operator's
Owner/Operator’srestaurants
restaurantsdo
donot
notmeet
meetthe
theNRBES
NRBES
Yes.
requirements, but
butthe
theOwner/Operator
Owner/Operatorand
andthe
theQ.SC
QSC VP
requirements,
VPmutually
mutually agree
agree upon
uponaawritten
written plan
(not to
to exceed
exceed 18
18 months)
months) to
to bring
bring the
the restaurants
restaurants up
up to
to NRBES
NRBES requirements,
(not
requirements, then
then the
the
willbe
beconsidered
considered as
as meeting
meeting the Standard.
Standard.
organization will
Financial
1. The Financial
Financial Standard
1.
Standard requires
requiresthat
that an
an Owner/Operator
Owner/Operator must
must pay McDonald’s
McDonald's and
and others
others
whatifIf an
an Owner/Operator
Owner/Operator has not paid
paid because he/she
he/she isis disputing
disputing an amount
on time. What
due?
Legitimate disputes
disputes regarding
regarding payment
payment will
will not
not cause
causean
anOwner/Operator
Owner/Operator to
to fail
fail to
to meet
Standard. However, if aa dispute arises
this Standard.
ariseswith
with McDonald’s
McDonald's or
or other
other vendors,
vendors, it remains
remains the
the
responsibility of
ofthe
theOwner/Operator
Owner/Operatortotoresolve
resolvethese
theseissues
issuesas
as soon
soon as
as possible.
possible.
responsibility
Owner/operator fail
fall to meet
meet the
the Financial
Financial Standard
2. Does an Owner/Operator
Standard Ififhe/she
he/she occasionally
financial statements
submits financial
statements a few days late?
Occasionally submitting
statements aa few days late will not
not cause
cause an
an
Occasionally
submitting financial statements
Owner/Operator to
to fail
fail to
tomeet
meet the
the Financial
Financial Standard.
However, it is
is the
Owner/Operator
Standard. However,
the responsibility of
the Owner/Operator
Owner/Operatorto
toinsure
insurethey
theymeet
meetall
all deadlines
deadlines required
required by
by the
the Franchise
Franchise Agreement.
3.. Does
Doesthe
thefailure
failuretotomeet
meetany
anyone
oneofofthe
thefinancial
financialviability
viability measurements
measurements (equity
cash flow
flow coverage
coverageratio
ratio and
and liability
liability turnover)
percentage, cash
turnover) mean
mean the Owner/Operator
meetthe
theFinancial
Financial Standard?
Standard?
fails to meet
point system
system is
is now applied
measurements in
An overall point
applied to
to the
the individual viability measurements
determining the
the financial
financial viability
viability of
of the
the restaurant
restaurantbusiness.
business. An
An organization
organization must
must achieve
achieve
determining
an overall
Please refer
an
overall score
score of
of 66 or
or greater
greater to
to meet
meet the
the financial
financial viability
viability measurement. Please
refer to
the National
National Franchising
Franchising Standards
Standards to
the
to see
seeaabreakdown
breakdownof
ofthe
the overall
overall point
point system.
system. The
are reviewed for accuracy
accuracy at
business review.
financial statements are
at the
the time
time of the business
review. As
As with
with
the Standards,
Standards, the Region
Region will
use their
in the
the assessment
assessment and
all of the
will use
their judgment in
and evaluation
evaluation of
the measurements
measurements and
and guidelines.
guidelines.
the
4
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Do II meet
Financial Standard
4. Do
meet the
the Financial
Standard ififmy
myorganization
organizationachieves
achieves an
an overall
overall score
score of
of 66 or
or
greater?
greater?
The point
is used
used to
todetermine
determinefinancial
financialviability
viability only.
only. The
TheFinancial
Financial Standard
Standard criteria
criteria
The
point system
system is
also require
require that
and pay
pay
also
that an
an organization
organization submit
submit accurate
accurate financial
financialstatements
statements timely
timely and
McDonald’s and
McDonald's
andothers
otherson
ontime.
time. Also,
Also, ififdebt
debton
onthe
thefinancial
financialstatements
statements does
does not
not meet
meet
McDonald’s borrowing
McDonald's
borrowingstandards,
standards,the
the Region
Regionwill
willrestate
restatethe
the debt
debt terms,
terms, which
which may
may affect
affect
the overall
overall score.
If my
McDonald’s borrowing
5. If
my organization’s
organization's financing
financing arrangements
arrangements fall
fall outside
outside of McDonald's
standards, how is
is this
standards,
this treated?
treated?
In determining
In
determining the
the financial
financial viability
viabilityof
ofan
anorganization,
organization,the
the Region
Regionwill
willrestate
restate any
any debt
debt that
that
falls outside of
of McDonald's
McDonald’s borrowing
borrowing standards.
standards.
falls
and/or non-recurring
non-recurring event affect my financial ratios?
6. How does a non-operating and/or
All business
be recorded
recorded in
in accordance
accordance with
with GAAP
GAAP and
All
business transactions
transactions should
should be
and reflected
reflected on
on the
the
financial statements
appropriately. Any
Any transactions
transactions or
or non-recurring
non-recurring events
will be
financial
statements appropriately.
events will
be
evaluated by
by the
the Region
Region as
as part
part of
transaction
evaluated
of the
the financial
financial viability
viabilityassessment
assessment where
where the
the transaction
alters the
overall financial
For example,
in situations
situations such
such as
as aa
alters
the overall
financial condition
condition of
of the
the organization.
organization. For
example, in
sale of
of restaurant(s)
restaurant(s) where
a significant
business and
and
sale
where a
significant amount
amount of
of cash
cash may
may come
come into
into the
the business
then be
be subsequently
subsequently drawn
drawn out,
out, the
the draw
draw may
may be
be exduded
exduded from
from the
the ratio
ratio calculations
calculations for
for
then
purposes of
of reviewing
reviewing financial
financial viability.
viability.
7. Do II get
get the
the maximum
maximum 44 points, under the
the cash flow coverage ratio, if II have
have no debt
regardless of what my net cash flow is?
regardless
No. Owner/Operators
Owner/Operators who
have no
no debt
debt service
service can
can only
level points
points
No.
who have
only achieve
achieve the
the highest
highest level
when positive
positive net
netcash
cashflow
flowisismaintained
maintainedafter
afterG&A
G&A and
and Draw.
Draw.
when
8. How is
is equity
equity percentage calculated?
Value of
Business minus
Net Debt
Debt on
Business divided
divided by
by the
Value of
Business
Value
of the
the Business
minus Net
on the
the Business
the Value
of the
the Business
(Value of
of Business)
Business) —
— (Net
(Value
(Net Debt)
Debt) == Equity
EquityPercentage
Percentage
(Value of Business)
Business)
(Value
•
Value of the Business:
Business:
Value
Cash Flow
Debt Service,
Service, G&A
G&A and
G&A ($35,000
Cash
Flow before
before Debt
and Draw
Draw less
less standard
standard G&A
($35,000 for
for
traditional restaurants
restaurants and
and $10,000
$10,000 for
for satellites)
satellites) multiplied
multiplied by
by Cash
Cash Flow
Flow multiple
multiple
traditional
of 4.5.
4.5. If
If the
equity percentage
percentage isis calculated
calculated to
to be
beless
lessthan
than25%
25% using
using this
this formula,
formula,
of
the equity
then the
the financial
financial director
director will
(with actual
actual
then
will use
use aa discounted
discounted cash
cash flow
flow method
method (with
reinvestment) to
determine the
the value
value of
of the
business.
reinvestment)
to determine
the business.
•
Debt on the Business
Business (Net
(Net Debt):
Debt):
Debt
Total Current
Current Liabilities
Total
Liabilities plus
plustotal
total Long-Term
Long-TermLiabilities
Liabilitiesminus
minusany
anyNotes
Notes Payable
Payable to
to
Stockholders minus
minus Current
Current Assets.
Stockholders
Both debt
and cash
cash flow
flow will
will be
be appropriately
appropriately adjusted
adjusted for
for all
all NEP
NEP restaurants.
Both
debt and
restaurants.
9.
9. How
How is
is mei
TrM liability
liability turnover calculated?
The liability
liability turnover
It represents
representsTTM
TTM Average Positive or
The
turnover is
is calculated
calculated over
over aa TTM
TTMperiod.
period. It
Negative Working
Working Capital
Capital divided
by Average
Average Daily
Daily Sales
Negative
divided by
Sales
5
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(Positive or
or Negative
NegativeWorking
Working Capital)
Capital) ==Liability
Liability Turnover
Turnover Ratio
Ratio
(Positive
(Average Daily
Daily Sales)
(Average
•
Working Capital
Working
Capital equals:
equals:
Current Assets less
less Current
Current Liabilities
Liabilities
Current
•
Current Liabilities
Current
Liabilities equals:
equals:
Total Current
Current Liabilities
Liabilities
Total
Minus: Current
CurrentPortion
PortionofofLong-Term
Long-Term Debt
Debt
Minus:
Plus:
1/12 of
ofCurrent
Current Portion
Portion of
of Long-Term
Long-Term Debt
Plus:
1/12
Debt
•
Daily Sales
Average Daily
Sales equals:
equals:
Total Annualized
Total
Annualized Sales
Sales divided
divided by
by 363
363
•
Under the
point system,
system, points
points are
are assigned
assigned for
for aa positive
positive or
or negative
negativeLiability
Liability
Under
the point
Turnover.
Negative
Liability
Turnover
is
calculated
if
Working
Capital
is
Turnover. Negative Liability Turnover is calculated if Working Capital isaa negative
negative
amount (i.e.,
(I.e., current
current liabilities
liabilities exceed
current assets).
assets). Positive
PositiveLiability
Liability Turnover
Turnover is
is
amount
exceed current
calculated if
if Working
current
calculated
WorkingCapital
Capitalisisa apositive
positiveamount
amount(i.e.,
(i.e.,current
currentassets
assets exceed
exceed current
liabilities).
liabilities).
10. How
How is
coverage ratio
ratio calculated?
10.
is cash
cash flow
flow coverage
calculated?
Cash Flow
Flow after
G&A and
actual G&A
G&A Isis used
in
Cash
after G&A
and Draw
Draw divided
divided by
by Annual
Annual Debt
Debt Service
Service (note:
(note: actual
used in
this calculation)
(Cash Flow
Flow after
G&A and
Ratio
(Cash
after G&A
and Draw)
Draw) = Cash
Cash Flow
Flow Coverage
Coverage Ratio
(Annual Debt Service)
Service)
(Annual
11.. Does
Does the
the Financial
Financial Standard
11.
Standard require
requireaaminimum
minimumamount
amountof
ofcash
cashbe
be kept
kept in
inthe
the business?
business?
No. Overall
Overall financial
financial viability
viability as
Financial Standard
No.
as part
part of
of the
the Financial
Standardmust
must be
be met.
met.
People
1.
What does
“having an
number of
of shift-certified
shift-certified or
or shift
shift verified
verified managers"
managers”
What
does "having
an adequate
adequate number
mean?
mean?
An adequate
number of
of shift-certified
shift-certified managers
managers is
is the
number required
required so
shift is
is
An
adequate number
the number
so that
that each
each shift
run by
by aa shift-certified
run
shift-certified manager
manager and
and will
will vary
varybased
based on
on hours
hours of
of operation.
operation.
2.
What is
is required
required for
to be
be Shift
Shift Certified
Certified with
BSM being
What
for an
an employee
employee to
with BSM
being phased
phased out
out with
with
the transition
transition to
to Restaurant
Restaurant Department
Department Management
Management (RDM)
(RDM) classes?
the
classes?
A Shift
Shift Verified
A
Shift Certified
Certified Manager
Manager must
must be
be Serve
Serve Safe
Safe certified,
certified, be
be Shift
Verified in
inthe
the restaurant
restaurant
and
have
successfully
completed
Introduction
to
Management
(ITM)
or
the
and have successfully completed Introduction to Management (ITM) or the previous
previous
equivalent(i.e.,
(i.e.,BOC,
BOC, BSM).
BSM).
equivalent
3.
If an
Introduction to
If
an Owner/Operator
Owner/Operator has
has aa shift
shift manager
manager that
that is
is ready
ready and
and able
able to
to attend
attend Introduction
to
Management (ITM),
(ITM), but
has
Management
but the
the manager
manager is
is waiting
waiting on
on class
class availability
availabilityto
to open
open or
or aa class
class has
been cancelled,
cancelled, will
will this
this be
be held
held against
against the
the Owner/Operator?
Owner/Operator?
been
No. McDonald's
McDonald’s acknowledges
acknowledges that
that it
it may
may take
time to
to schedule
schedule shift
shift running
running
No.
take some
some time
managers to
to ITM
ITM class.
Any Owner/Operators
in this
managers
class. Any
Owner/Operators in
this situation
situation should
should work
work with
with their
their
Region to
plan to
get their
their shift
shift running
running managers
managers certified
certified as
soon as
as isis practical.
practical.
Region
to develop
develop aa plan
to get
as soon
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4.
4.
Are satellites
required to
to have
haveHU/ROLP/GM
HU/ROLP/GM Capstone
Are
satellites required
Capstone trained
trained managers?
managers?
No, typically
restaurants are
are not
notrequired
required to
tohave
haveHU/ROLP/GM
HU/ROLP/GM Capstone
No,
typically satellite
satellite restaurants
Capstone trained
trained
managers. However,
However, the
thesatellite
satelliterestaurant's
restaurant’s franchising
franchising documents
documents may
may require
require an
an
managers.
HU/ROLP/GM Capstone
HU/ROLP/GM
Capstonetrained
trained manager.
manager.
5.
5.
An Owner/Operator
The survey
survey
An
Owner/Operator organization
organizationconducts
conductsan
anemployee
employee commitment
commitment survey.
survey. The
scores are
are much
much lower
lower than
Owner/Operator would
like. As
As aa result,
result the
the organization
organization
scores
than the
the Owner/Operator
would like.
creates and
and implements
implements an
an action
Will the
creates
action plan
plan to
to address
address the
the deficiencies.
deficiencies. Will
the low
low
commitment score
score cause
cause this
this organization
organization to
meet the
the People
People Standard?
Standard?
commitment
to not
not meet
No. This
No.
This Standard
Standard requires
requiresconducting
conductingthe
the survey
surveyand
and reviewing
reviewing the
the feedback.
feedback.
6.
6.
Does the
the Owner/Operator
Owner/Operator have
have to
touse
usethe
theMcDonald's
McDonald’sapproved
approved Manager
Manager and
and Crew
Crew
Does
Commitment Survey?
Survey?
Commitment
No. However,
However, the
the Owner/Operator
Owner/Operator must
must have
feedback process
process in
in
No.
have an
an effective
effective employee
employee feedback
place. As
As part
part of
of this
this process,
process, the
the Owner/Operator
Owner/Operator must
must gather
gather and
and review
review anonymous
place.
anonymous
feedback from
from the
the management
management and
and crew
crew at
at each
each restaurant
restaurant at
at least
least annually.
annually.
feedback
7.
Can you
provide more
more details
details on
on our
our People
People Migration
Migration Strategy?
Can
you please
please provide
Strategy?
The People
People Migration
Migration Strategy
Strategy isIs aa three-tiered
three-tieredapproach
approachincluding
includingBHOT'r,
BHOT’r, Shift
Shift
The
Management Excellence
Excellence and
Management
and Restaurant
RestaurantDepartment
DepartmentManagement.
Management. Consistent
Consistent use
use of
of the
the
migration tactics
supports crew
benefits, hiring,
hiring, orientation,
training and
with
migration
tactics supports
crew benefits,
orientation, training
and retention
retention with
extended focus
focuson
onShift
Shift Managers
Managers with
with Shift
Shift Management
Excellence. Restaurant
Restaurant
extended
Management Excellence.
Department
Management
serves
as
the
capstone
of
the
strategy
with
a
management
Department Management serves as the capstone of the strategy with a management
structure,
curriculum
and
management
support
tools.
Consistent
use
of
helps
structure, curriculum and management support tools. Consistent use of these
these tactics
tactics helps
to provide
provide aa foundation
foundation of
of highly
highly skilled
to
skilled and
and motivated
motivated restaurant
restaurant employees.
employees.
8.
8.
What are
examples of
of McDonald's
McDonald’s training/meetings
a
What
are some
some examples
training/meetings that
that would
would demonstrate
demonstrate a
General Manager
General
Manager has
has remained
remained current
current with
with restaurant
restaurant operations
operations each
each year?
year?
Some examples
examples include,
include, but
but are
arenot
notlimited
limited to,
to,participation
participation at
at Regional,
Regional, Division
Division and
and
Some
National meetings
such as
as Seed
Seed Stores,
Stores,Plan-to-Win
Plan-to-Win Road
Road Shows,
Shows, Manager
Manager Rallies,
Rallies,
National
meetings such
Operations Summits,
Summits, COMR.,
COMR., Business
It is
Is important
important that
that General
General
Operations
BusinessAlignment
Alignmentmeetings,
meetings, etc.
etc. It
Managers stay
of our
our
Managers
stay current
current with
with restaurant
restaurantoperations
operationsbecause
because the
the continued
continued success
success of
System is
is founded
on having
having highly
highly skilled
The
System
founded on
skilled and
and motivated
motivated restaurant
restaurant employees.
employees. The
ongoing training
training and
of our
our General
General Managers
Managers is
to retaining
retaining
ongoing
and development
development of
is essential
essential to
qualified personnel
to operate
operate and
and build
build the
the McDonald's
McDonald’s business.
business.
qualified
personnel to
9.
How will
10 hours
hours of
of continuing
continuing education
education for
for General
General Managers
Managers be
be tracked?
tracked?
How
will the
the 10
The
Owner/Operator
will
have
the
responsibility
and
flexibility
to
track
the
10 hours
hours of
The Owner/Operator will have the responsibility and flexibility to track the 10
of
continuing education
education for
for their
their General
General Managers
Managers in
suited for
for their
continuing
in aa manner
manner best
best suited
their
organization.
Building the
Building
the Business
Business throueh
through Guest Satisfaction
1. What
Whatdoes
doesititmean
meantotohave
haveall
allshifts
shiftsadequately
adequatelystaffed
staffed with
withtrained
trained crew
crew and
and
1.
management to
to maximize
maximize sales?
management
Adequately staffed
for aa shift
Adequately
staffed for
shift means
means having
having enough
enough trained
trainedemployees
employees on
on the
the floor
floor to
to meet
meet
the projected
projected sales
sales and
and satisfy
satisfy guests.
Restaurants that
that have
have shifts
shifts adequately
adequately staffed
the
guests. Restaurants
staffed to
to
7
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maximize sales
the guest
guest expectations,
expectations, respond
respond quickly
quickly to
any
maximize
sales are
are able
able to
to meet
meet or
or exceed
exceed the
to any
guest concerns,
concerns, and
and maximize
maximize sales potential.
potential.
guest
2. What are
of an
an Owner/Operator showing support for System
2.
are some
some examples of
System promotions,
recommendations and initiatives?
System promotions,
promotions, recommendations
and initiatives
initiatives should
supported in
in
System
recommendations and
should be
be consistently
consistently supported
each restaurant
restaurant of
of an
We work
work collaboratively
with
each
an Owner/Operator
Owner/Operator organization.
organization. We
collaboratively together
together with
Owner/Operators to
ensure our
our Plan
Plan to
business forward.
forward.
Owner/Operators
to ensure
to Win
Win isis designed
designed to
to drive
drive the
the business
Examples
include,
but
are
not
limited
to,
new
product
launches,
promotional
activities,
Examples include, but are not limited to, new product launches, promotional activities,
extended hours
hours of
of operation
operation and
and value
value offerings.
offerings. Any
Any concerns
concerns an
an Owner/Operator
Owner/Operator may
may
extended
have regarding
regarding the
or initiative
initiative (such
(such as
have
the support
support of
of aa System
System promotion,
promotion, recommendation
recommendation or
as
extended hours)
hours) for
for aa specific
specific restaurant
restaurant of
Owner/Operator organization
extended
of the
the Owner/Operator
organization should
should be
be
discussed with
withthe
theQSC
QSC VP
VP or
or Field
Field Service Team.
discussed
3. Are “special
3.
"special venue”
venue" restaurants
restaurants required
required to
to participate
participate in
in all
allSystem
System promotions?
promotions?
No, there
will be
situations when
when the
the OPNAD
OPNAD and
No,
there will
be situations
and Co-Op
Co-Opendorsed
endorsedpromotions
promotions cannot
cannot be
be
implemented. Before
Beforeaa new
newpromotion
promotion isis rolled
rolled out,
out, the
the Owner/Operator
Owner/Operator and
and the
the Region
Region
implemented.
should discuss
should
discuss whether
whether there
there are
are circumstances
circumstancesthat
thatwould
would prevent
preventthe
the owner/operator
owner/operator
from selling
selling certain
from
certain products
products or
or participating
participatinginincertain
certainpromotions
promotionsat
atthese
these locations.
locations.
4. How will
this Standard?
Standard?
will mystery
mystery shop
shop results
results be used when assessing this
Mystery
Shop
scores
are
not
a
measurement
tool
in
this
Standard
an
Mystery Shop scores are not a measurement tool in this Standard and
and will
will not
not cause
cause an
Owner/Operator
organization
to
fail
to
meet
this
Standard.
However,
the
results
will
Owner/Operator organization to fail to meet this Standard. However, the results will be
be
discussed as
as they
they provide
provide an
an additional
additional source
discussed
source of
of information
information and
and can
can help
help to
to develop
develop
insightful commentary
Mystery Shop
insightful
commentary within
withinOwner/Operator
Owner/Operatorbusiness
businessreviews.
reviews. See
See Mystery
Shop memo
memo
issued October
October 3,
2011 for
for further
(Marion wants
or list
list key
key points
points
issued
3, 2011
further details.
details. (Marion
wants to
to attach
attach memo
memo or
or leave
leave it
it off-she doesn't
doesn’t think
think they can
can find
or
find the
the memo)
5.
5. How will
assessing this
this Standard?
will the
the number
number of
of guest
guest complaints
complaints be used when assessing
The number
complaints is
is no
no longer
longer used
used as
as aa measurement
measurement in
in this
this Standard
Standard and
and
The
number of
of guest
guest complaints
will not
an Owner/Operator
Owner/Operator to
this Standard.
Standard. Rather,
Rather, the
organization
will
not cause
cause an
to fail
fail to
to meet
meet this
the organization
should focus
on call
call back
See Customer
Customer Complaint
Complaint memo
August 30,
should
focus on
back responsiveness.
responsiveness. See
memo dated
dated August
30,
for further details.~
2011 for
details.
6. Does the "All
“All shifts
maximize sales”
6.
shifts adequately
adequately staffed
staffed to maximize
sales" guideline
guideline contained
contained In
in the
the
Building the
Building
the Business
Business through
through Guest Satisfaction
Satisfaction Standard
Standard requires
requires aa restaurant
restaurant to
to adopt
extended hours?
No. The
The reference
reference in
in this
this guideline
guideline to
to "maximizing
“maximizing sales”
staffing
No.
sales" refers
refers to
to adequately
adequately staffing
existing shifts.
24 hours
hours or
or extended
hours and
and the
implement them
should be
be aa
existing
shifts. 24
extended hours
the decision
decision to
to implement
them should
discussion between the
the Owner/Operator
Owner/Operator and
and the
the Region.
Region.
discussion
7. What does it
It mean to maximize
maximize sales "by
“by providing
7.
providingreliable,
reliable,competitive
competitive value
value to
to the
the
guest”?
guest"?
Our guests
a menu
menu that
that offers
offers compelling
compelling value
value every
every time
time they
they visit
visit aa McDonald's
McDonald’s
Our
guests expect
expect a
restaurant Accordingly,
Accordingly, in
in order
order to
remain competitive
restaurant.
to remain
competitive and
and relevant
relevant to
to our
our guests,
guests,
McDonald’s restaurants
McDonald's
restaurants must
must offer
offer aa value
value platform
platformwhich
whichisisconsistent
consistentwith
withthese
these
expectations. Reliable,
Reliable, competitive
competitivevalue
valuewill
will evolve
evolve over
over time
timeand
and vary
vary from
from market
market to
expectations.
to
market.
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complaint.
800# with
the 800#
called the
that called
guest that
reachaaguest
unabletotoreach
Owner/Operatoris Isunable
TheOwner/Operator
8. The
with aa complaint.
Business through
theBusiness
Buildingthe
theBuilding
meetsthe
Owner/Operatormeets
the Owner/Operator
whether the
impact whether
this impact
Will this
through
Guest Satisfaction Standard?
has aa guest
and has
guest and
the guest
contact the
to contact
attempts to
reasonable attempts
made reasonable
has made
Owner/Operatorhas
the Owner/Operator
If the
guest
the
against
held
be
process in
recovery process
recovery
in place)
place,failure
failure to
to reach
reach that
that guest
guest will
will not
not be held against the
Owner/Operator.
Owner/Operator.
Involvement
Owner/Onerator
OwnerlOnerator Involvement
issues
on issues
Company on
theCompany
challenge the
orchallenge
disagreeor
todisagree
Owner/Operatorto
1. Is It
1.
it acceptable for an Owner/Operator
policies?
and policies?
encourages
McDonald’s encourages
Yes,
as long
long as
asitit isisdone
doneininaaprofessional
professionaland
andconstructive
constructivemanner.
manner. McDonald's
Yes) as
System.
the System.
of the
interest of
best interest
the best
in the
done in
thatisis done
initiative that
individual initiative
or individual
debate or
spirited debate
spirited
Co-Op is
OPNAD and
in OPNAD
2. Participation in
2.
and the Co-Op
isvoluntary
voluntary under
under the
the Franchise
FranchiseAgreement
Agreement. If
If an
an
local Co-Op.
OPNAD or the local
of OPNAD
member of
not aa member
Owner/Operator
Co-Op,will
willthis
thisOwner/Operator
Owner/Operator
Owner/operatorisIs not
Standard?
Involvement Standard?
Owner/OperatorInvolvement
the Owner/Operator
meet the
meet
Franchising Standards
No. The
The National Franchising
Standardsrequire
requirean
anOwner/Operator
Owner/Operator to
to be
be aa member
member of
of both
both
not.
does
Agreement
FranchIse
the
though
Co-Op even
local Co-Op
OPNAD
and the
the appropriate local
the Franchise Agreement does not.
OPNAD and
been added
has been
business has
thebusiness
withthe
currentwith
remaincurrent
Owner/Operatorsremain
that Owner/Operators
requirement that
3. A requirement
added to
to
3.
measured?
be
this
will
How
Standard.
Involvement
Owner/OperatorInvolvement Standard. How will this be measured?
the Owner/Operator
ongoing education.
business through
the business
of the
student of
be aa student
must be
Owner/Operator must
An Owner/Operator
through ongoing
education.
business can
the business
Remaining current with the
can be
be achieved
achievedby
bycompleting
completing one
oneof
ofthe
the following:
following:
OR
year. OR
each year.
events each
and events
conventions,and
meetings, conventions,
McDonald’s meetings,
In McDonald's
Participating in
• Participating
years.
10
past
the
within
class
training
HU
based
Owner/Operator
an
Attending
• Attending an Owner/Operator based HU training class within the past 10 years.
OR
OR
years. OR
10 years.
past10
the past
class within
Capstone class
GM Capstone
the GM
Attending the
• Attending
within the
18 months
past
the
within
team
system
McDonald’s
a
on
Participating
a McDonald's system team within the past 18
months
•
RLC, OPNAD,
DLC,RLC,
NLC,DLC,
limitedto,to,NLC,
notlimited
are not
but are
(Examples include, but
(Examples
OPNAD, regional,
regional,
OR
sub teams) OR
or sub
divisional teams or
teams, divisional
Sponsoring aa McDonald’s
• Sponsoring
McDonald's training
training class
classwithin
within the
the past 18
18 months.
months.
9
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Franchising Standards
National Franchising
National
Standards
FAQ~ asasofof12/1/13
FAQs
12/1/13
(Effective 04/01/14)
(Effective
04/01/14)
Franchising Standards
National Franchising
the National
The following FAQ’s
The
FAQ'sare
areintended
intended to
to add
add texture
texture to
to the
Standards and
and the
the
whether
assess
to
used
are
Guidelines
and
Measurements
The
Measurements and
and Guidelines.
Guidelines. The Measurements and Guidelines are used to assess whether
Owner/Operator and
resufts of
performance and results
the performance
of the
the Owner/Operator
and his/her
his/her organization
organization meet
meet the
the
Standards.
Standards.
General Questions
General
Standards changed?
FranchisingStandards
NationalFranchising
theNational
Havethe
1. Have
1.
changed?
Franchising Standards
National Franchising
Yes, the
Yes,
the National
Standards(the
(the~Standards”)
"Standards")have
haveevolved
evolvedtotomeet
meetthe
the needs
needs
Brand,
the Brand,
elevate the
opportunity to
an opportunity
provide an
enhancements provide
The enhancements
our business.
of our
business. The
to elevate
further distance
and further
business and
our business
in our
successful in
be successful
takes to
it takes
what it
communicate what
to be
distance ourselves
ourselves
from the
from
the competition.
trying
(What are
Each of
Each
of the
the six
six Standards
Standards now
now Includes
includes an
an aspirational
aspirational Vision
Visionstatement
statement (What
are we
we trying
incorporate
to
help
which
it?),
doing
we
are
(Why
statement
Purpose
a
and a Purpose statement (Why are we doing it?), which help to incorporate
to accomplish?) and
Vision
the Vision
of the
addition of
The addition
Franchising Standards.
National Franchising
the National
into the
McDonald’s values into
the McDonald's
the
Standards. The
us
all
reminds
and
Standards
the
to
clarity
additional
provides
Purpose statements
and Purpose
statements provides additional clarity to the Standards and reminds all of
of us
accomplish.
trying to accomplish.
are trying
we are
what we
additional
while additional
revised while
been revised
also been
has also
The Standard
The
Standardstatement
statement (What
(What needs
needs to
to be
be done?)
done?) has
six
the six
of the
(Is itit being
guidelines (Is
and guidelines
measurements and
being done?)
done?) have
have been
been added
added to
to each
each of
Standards.
Standards include:
Franchising Standards
National Franchising
the National
to the
Other significant
Other
significant changes to
include:
Standard.
Financial Standard.
theFinancial
ofthe
independentof
Standard, independent
newStandard,
Reinvestmentisis aa new
o Reinvestment
addition to
in addition
has an
Standard now
The Operations
o The
Operations Standard
now has
an organizational
organizational measurement
measurement, in
to aa
restaurant measurement.
restaurant
Viability
Financial Viability
determineFinancial
to determine
Financial Standard
Standard has
has aa point
point system
system to
o The Financial
with
current
remain
must
Managers
General
Standard, General Managers must remain current with the
In the
the People Standard,
the business
business
o In
year
each
following
the
of
one
by demonstrating
demonstrating
of the following each year:
restaurant
Participated in
• Participated
■
in 10
10 hours
hours of
of McDonald’s
McDonald's training/meetings
training/meetings on
on restaurant
OR
operations. OR
operations.
GM Capstone
current GM
the current
• Passed the
■
Capstone proficiency
proficiency test.
test.
Customer Satisfaction
o Customer
Satisfaction is
is now
now the
the Building
Buildingthe
the Business
Business through
through Guest
Guest Satisfaction
Satisfaction
Win.
Plan to
supporting the
Standard and
Standard
and includes supporting
the Plan
to Win.
includes aa requirement
Standard now
Involvement Standard
The Owner/Operator Involvement
now includes
requirement to
to stay
stay
o The
activities.
learning activities.
continuous learning
through continuous
business through
current with
current
with the business
Standards?
Franchising Standards?
NationalFranchising
theNational
purposeofofthe
thepurpose
Whatisisthe
2. What
including
Franchising Standards
The National Franchising
Standards form
form the
the basis
basis for
for all
all franchising
franchising decisions
decisions including
of
Each of
incentives.
and
programs
certain
eligibility for participation
and eligibility
rewrite and
growth, rewrite
participation in
in certain programs and incentives. Each
The
System.
McDonald’s
the
of
success
the
to
important
Standards is
six Standards
the six
is critically
critically important to the success of the McDonald's System. The
U.S.
across the
National
FranchisingStandards
Standardsare
areintended
intendedto
to be
be applied
applied consistently
consistently across
the U.S.
National Franchising
Agreement.
Franchise
the
supplement
or
change
not
do
and
business
change or supplement the Franchise Agreement.
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3.
When will
will McDonald's
McDonald’s begin
begin applying
applying the
revised National
National Franchising
Franchising Standards
When
the revised
Standards and
and the
the
revised measurement
measurement tools
tools and
and guidelines?
guidelines?
revised
The revised
revised National
National Franchising
Franchising Standards
The
Standards will
willbe
be used
used for
for all
all Business
Business Reviews
Reviews taking
taking place
place
after April
This will
prepare for
after
April 1,
1, 2014.
2014. This
will allow
allow ample
ample time
time for
for the
the System
System to
to prepare
for and
and understand
understand
the revisions
revisions to
to the
the Standards.
Standards. If
If there
are situations
measurements and
and
the
there are
situations where
where the
the measurements
guidelines associated
associatedwith
withthe
therevised
revisedNational
NationalFranchising
Franchising Standards
Standards result
result in
in aa
guidelines
determination of
of ineligibility
ineligibility where
determination
where the
the Owner/Operator
Owner/Operator previously
previously would
would have
have been
been
considered eligible
eligible for
for growth
considered
growth and
and rewrite,
rewrite, there
there will
will be
be communication
communication with
with the
the
Owner/Operator prior
prior to
Owner/Operator becoming
becoming ineligible
ineligible for
for growth
rewrite
Owner/Operator
to the
the Owner/Operator
growth and
and rewrite
regarding the
regarding
the expectations and timing of compliance.
4.
4.
Does an
an Owner/Operator's
Owner/Operator’s organization
organization have
have to
to meet
meet all
all six
six of
of the
theNational
National Franchising
Franchising
Does
Standards to
be eligible
eligible for
for growth,
rewrite and
be eligible
eligible to
to participate
participate in
in certain
certain
Standards
to be
growth, rewrite
and to
to be
programs and
programs
and incentives?
incentives?
Yes. Each
Each Standard
Standard is
McDonald’s System.
Yes.
is critically
criticallyimportant
importantto
tothe
the success
success of
of the
the McDonald's
System.
Owner/Operators must
must meet
meet each
each Standard
Standard and
and be
be in
in compliance
compliance with
with the
the Franchise
Franchise
Owner/Operators
Agreement to
to be
be considered
considered eligible
eligible for
for growth
growth and
and rewrite
rewrite and
and to
be eligible
eligible to
participate
Agreement
to be
to participate
in certain
Do we
need to
to be
bespecific
specificabout
aboutprograms
programslike
like MRP?
MRP?
in
certain programs
programs and
and incentives.
incentives. Do
we need
Rebuild?
5.
How will
National
How
will McDonald’s
McDonald's communicate
communicate an
an Owner/Operator’s
Owner/Operator's status
status relative
relative to
to the
the National
Franchising Standards?
Franchising
Standards?
Generally, each
Owner/Operator organization
organization will
Business Review
Review at
every
Generally,
each Owner/Operator
will receive
receive aa Business
at least
least every
18
months.
Generally,
any
Owner/Operator
organization
that
is
ineligible
for
growth
and
18 months. Generally, any Owner/Operator organization that is ineligible for growth and
rewrite will
The Region
Region will
rewrite
will receive
receive aa Business
Business Review
Review every
every 12
12 months.
months. The
will evaluate
evaluate the
the
Owner/Operator’s performance
and guidelines
Owner/Operator's
performance relative
relativeto
tothe
the measurements
measurements and
guidelines of
of each
each
Standard. During
During the
Business Review,
Review, Regional
Standard.
the Business
Regional Management
Management will
will communicate
communicate the
the
Owner/Operator’s eligibility
eligibility status
Owner/Operator's
status for
for growth
growth and
and rewrite.
rewrite.
In addition,
an Interim
Interim Business
Review updating
updating their
In
addition, an
an Owner/Operator
Owner/Operator may
may receive
receive an
Business Review
their
eligibility status
a
eligibility
status ifif itit becomes
becomes apparent
apparent that
that the
the organization
organization isis not
not meeting
meeting or
or now
now meets
meets a
Standard.
Sta
nda rd.
6.
If an
disagrees with
with the
theQJSC
~1SC VP
a
If
an Owner/Operator
Owner/Operator disagrees
VPononwhether
whetherthe
theorganization
organization meets
meets a
Standard, what
Standard,
what are
are his/her
his/her options?
options?
As with
all issues
and disputes
disputes within
within McDonald's,
McDonald’s, our
As
with all
issues and
our “open
"open door”
door" policy
policy (e.g.,
(e.g., appealing
appealing to
to
the
Ombudsman
or
higher
levels
of
McDonald’s
management)
would
apply.
the Ombudsman or higher levels of McDonald's management) would apply.
7.
Under what
term franchise
franchise
Under
what circumstances
circumstances could
could an
an Owner/Operator
Owner/Operator not
not be
be offered
offered aa new
new term
(rewrite) even
even though
though the
the Owner/Operator
Owner/Operator is
is eligible
eligible for
for growth
(rewrite)
growth and
and rewrite?
rewrite?
Typically, this
Typically,
this would
would only
onlyoccur
occurififthe
the restaurant
restaurantwas
wasclosing
closingdue
dueto
to aa lack
lackof
of real
realestate
estate
tenure or
or changes
changes in
in the
the trading
trading area.
area.
tenure
ODerations
Operations
1. Previously,
PrevIously,the
theOperations
OperationsStandard
Standardonly
onlymeasured
measuredgraded
gradedROIP
ROIP visits
visits at
at an
an individual
individual
1.
restaurant level.
level. Why
Why has
has aa new
new measurement
measurement been
beenadded
addedfor
forgraded
gradedROIP
ROIP visits
restaurant
visits at
at the
the
Owner/Operator organization
organization level
Owner/Operator
level as
as well?
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The changes
The
changesto
tothe
theOperations
OperationsStandard
Standardare
areintended
intendedtotodemonstrate
demonstrateour
our commitment
commitment to
highest levels
levels of
of QS&C
QS&C and
our guests by delivering the highest
and Food
FoodSafety,
Safety,while
while not
not deviating
deviating
from the
the ROIP
ROIP process.
Standard) when
from
process. We
We believe
believe that
that this Standard,
when measured
measured only
only at the
restaurant level,
level, does
does not
not adequately
adequately assess
assess an
individual restaurant
anOwner/Operator’s
Owner/Operator's overall
overall
operational performance.
performance. Previously,
Previously, an
an organization
organization could
could fail
fail as
as many
many as
as 67%
operational
67% of
of their
their
ROIP cycle,
graded visits in an ROIP
cycle,and
andyet
yetstill
stillmeet
meet the
the Operations Standard.
Standard.
We will
will continue
continuetotouse
useexisting
existingresources,
resources,including
includingFORs,
FORs, SORs
SORs and
We
and Food
Food Safety
Safety Procedure
Verifications to determine
determine whether
whether aa restaurant
restaurant and
and an
organization
Verifications
an Owner/Operator’s
Owner/Operator's organization
meet the
the Operations
Operations Standard.
Standard. Please
Please refer to
updated Operations
Operations Standard
Standard for
details
meet
to the updated
for details
on the Organization
Organization measurement
measurement as
asapplied
appliedto
toOwner/Operator
Owner/Operator organizations
organizations with
with one,
one,
two, three, four
four and
and five or more
more restaurants.
restaurants.
2. Does
Does aa restaurant that fails only one
Operations Standard?
Standard?
2.
one food
food safety audit
audit meet the Operations
In most
most cases,
cases, yes.
safety issues
In
yes. However
However the
the severity
severity of
of the
the food
food safety
issues may
may require
require aadifferent
different
answer.
answer.
3. An Owner/Operator
acquires a restaurant that does
does not
3.
Owner/Operator acquires
not meet McDonald’s
McDonald's operational
standards. During
During the first few months
months after
after the
the acquisition,
acquisition, the restaurant receives
receives
standards.
graded visits
graded
visitsthat
that do
do not
not meet
meet the
the Operations
Operations Standard.
Standard. How will this impact
impact the
Owner/Operators eligibility
eligibility for growth and rewrite?
Owner/Operator's
This situation
not impact
impact the
the Owner/Operator's
Owner/Operator’sstatus
status as
as he/she
he/she will
will be
be given
given aa
This
situation will not
reasonable period
restaurant’s operations to an
an acceptable level.
reasonable
period of time to raise that
that restaurant's
level. The
appropriate time
time frame
frameshould
should be
be discussed
discussed with the
the QSC
USC VP
VPatatthe
thetime
time of
of the
the acquisition.
acquisition.
Please refer
Please
refer to
to the
the USC
QSCplaybook
playbookfor
formore
more information
information on graded visits
visits occurring after a
change of ownership takes place.
place.
change
4. If
If an
an Owner/Operator
Owner/Operatorsells
sells aa restaurant
restaurant that
that does
does not
not meet
meet the
the Operations
Operations Standard
Standard and
and
4.
all of
of the other
other restaurants
restaurants in
in the
the organization
organization do meet
meet the
the National
National Franchising
Franchising
all
Standards, isisthe
eligible for
Standards,
theOwner/Operator
Owner/Operator now eligible
for growth
growth and
and rewrite?
rewrite?
Assuming the
has consistently
Assuming
the Owner/Operator’s
Owner/Operator's organization has
consistently met
met all
all the
the National
Franchising Standards
Franchising
Standardsatattheir
theirremaining
remainingrestaurants,
restaurants,the
theOwner/Operator
Owner/Operator organization
organization
become eligible
and rewrite upon
upon selling
selling its only
would likely become
eligible for
for growth and
only restaurant in
in the
Improvement Process
Process for
for Underperforming
UnderperformingRestaurants
Restaurants(IPUR).
(IPUR). However,
However,the
theQSC
USC VP
VP may
Improvement
not immediately
immediately support
support the
the Owner/Operator's
Owner/Operator’s growth
growthbased
based on
on the circumstances
circumstances that
not
that
caused the
Operations standard
place.
caused
the sold
sold restaurant
restaurant to
to not meet the Operations
standard in
in the
the first place.
eligible for growth and rewrite
rewrite once
once a restaurant is
is removed
5. Is an
an Owner/Operator
Owner/Operator eligible
removed from
IPUR and placed back into the
the normal
normal ROW
ROIP process?
process?
Depending on
Depending
on the
the facts and
and circumstances,
circumstances,some
someOwner/Operators
Owner/Operatorswill
will be
be eligible
eligible for
for
and rewrite
rewrite immediately
immediatelyafter
aftercoming
comingout
outofofIPUR.
IPUR. However,
However, some
growth and
become eligible
once the
Owner/Operators may not immediately become
eligible for
for growth
growth and
and rewrite once
the
restaurant is
is removed
removed from
fromIPUR
IPUR and
and placed
placed back into the
the normal
normalROIP
ROIP process.
process. Rather,
restaurant
Rather, the
the
can operate all
all restaurants at a
a level
organization must demonstrate that itit can
level that
that meets
McDonald’s QSC
USC standards
McDonald's
standardsconsistently
consistentlyover
over aaperiod
period of
of time.
time.
an Owner/Operator is
is not eligible for growth
growth and
and rewrite
rewrite upon
upon coming
coming out
out of
ofIPUR,
IPUR, the
If an
the
USC VP
QSC
VPwill
willcommunicate
communicatethe
thetime
timeperiod,
period,up
upto
totwelve
twelvemonths,
months,that
that the
the organization
organization will
will
remain ineligible
ineligible for
for growth
growth and
and rewrite.
rewrite. IfIf during that time period, the Owner/Operator
consistently meets
meets all
all of
of the National
National Franchising
Franchising Standards,
regain its
consistently
Standards,the
the organization
organization will
will regain
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eligibility for
period. Periodic
Periodic updates
regarding
eligibility
for growth
growth and
and rewrite
rewrite at
at the
the end
end of
of this
this time
time period.
updates regarding
the
organization’s
status
and
the
restaurant’s
performance
against
McDonald’s
operational
the organization's status and the restaurant's performance against McDonald's operational
standards should
should be
be communicated
communicated to
to the
the Owner/Operator
Owner/Operator while
while the
the organization
organization remains
remains
standards
ineligible.
Reinvestment
Reinvestment
i.
1.
why is
Reinvestment, which
which was
was previously
previously reviewed
reviewed as
as aa part
part of
ofthe
theFinancial
Financial Standard,
Standard,
Why
is Reinvestment,
now an
an independent
independent Standard?
Standard?
now
With Reinvestment
Reinvestment as
standard, we
will be
better identify
identify
With
as an
an independent
independent standard,
we will
be able
able to
to better
Owner/Operator organizations
organizations that
that are
are not
not financially
financially viable,
that just
just fail
fail
Owner/Operator
viable, rather
rather than
than those
those that
reinvest
to reinvest.
2.
2.
Does every
every restaurant
restaurant in
in an
National
Does
an Owner/Operator’s
Owner/Operator's organization
organization have
haveto
to meet
meet the
the National
Restaurant
Building
and
Equipment
Standards
(“NRBES”)
to
meet
the
Reinvestment
Restaurant Building and Equipment Standards ("NRBES") to meet the Reinvestment
Standard?
Standard?
Yes. However,
However, ifif one
oneor
or more
more of
ofan
an Owner/Operator's
Owner/Operator’s restaurants
restaurants do
do not
not meet
meetthe
theNRBES
NRBES
Yes.
requirements, but
butthe
theOwner/Operator
Owner/Operatorand
andthe
theQ.SC
USC VP
VP mutually
plan
requirements,
mutuallyagree
agree upon
upon aa written
written plan
(not to
to exceed
exceed18
18months)
months)to
tobring
bringthe
therestaurants
restaurantsup
upto
toNRBES
NRBES requirements,
(not
requirements, then
then the
the
organization will
will be
be considered
considered as
as meeting
meeting the
theStandard.
Standard.
organization
Financial
Financial
1.
1.
The Financial
Financial Standard
The
Standard requires
requiresthat
that an
an Owner/Operator
Owner/Operator must
must pay
pay McDonald’s
McDonald's and
and others
others
on time.
time. What
Whatifif an
an Owner/Operator
Owner/Operator has
has not
not paid
is disputing
disputing an
on
paid because
because he/she
he/she is
an amount
amount
due?
due?
Legitimate disputes
regarding payment
Legitimate
disputes regarding
payment will
willnot
not cause
cause an
an Owner/Operator
Owner/Operatorto
to fail
failto
to meet
meet
this
Standard.
However,
if
a
dispute
arises
with
McDonald’s
or
other
vendors,
it
remains
this Standard. However, if a dispute arises with McDonald's or other vendors, it remains the
the
responsibility of
as possible.
possible.
responsibility
of the
the Owner/Operator
Owner/Operatorto
to resolve
resolve these
these issues
issues as
as soon
soon as
2.
Does an
an Owner/Operator
Owner/Operator fail
fall to
meet the
the Financial
Financial Standard
Does
to meet
Standard Ififhe/she
he/she occasionally
occasionally
submits financial
financial statements
days late?
submits
statements a
a few
few days
late?
Occasionally submitting
an
Occasionally
submitting financial
financialstatements
statements aa few
few days
days late
late will
will not
not cause
cause an
Owner/Operator to
fail to
meet the
the Financial
Financial Standard.
Standard. However,
However, it
it is
is the
responsibility of
of
Owner/Operator
to fail
to meet
the responsibility
the Owner/Operator
Owner/Operator to
to insure
insure they
they meet
meetall
all deadlines
deadlines required
required by
by the
the Franchise
Franchise Agreement.
the
Agreement.
3.
3.
Does the
the failure
failure to
to meet
meet any
any one
one of
ofthe
thefinancial
financial viability
viability measurements
(equity
Does
measurements (equity
percentage, cash
cash flow
flow coverage
coverage ratio
ratio and
and liability
liability turnover)
percentage,
turnover) mean
mean the
the Owner/Operator
Owner/Operator
fails to
to meet
meetthe
theFinancial
Financial Standard?
Standard?
fails
An overall
is now
now applied
applied to
to the
the individual
individual viability
viability measurements
in
An
overall point
point system
system is
measurements in
determining
the
financial
viability
of
the
restaurant
business.
An
organization
must
determining the financial viability of the restaurant business. An organization must achieve
achieve
an overall
overall score
financial viability
Please refer
refer to
an
score of
of 6
6 or
or greater
greater to
to meet
meet the
the financial
viabilitymeasurement.
measurement. Please
to
the National
National Franchising
Franchising Standards
The
the
Standardsto
tosee
see aa breakdown
breakdownof
ofthe
the overall
overall point
pointsystem.
system. The
financial statements
are reviewed
reviewed for
for accuracy
accuracy at
As with
with
financial
statements are
atthe
the time
time of
of the
the business
business review.
review. As
all of
Standards, the
Region will
and evaluation
all
of the
the Standards,
the Region
will use
use their
theirjudgment
judgment in
inthe
theassessment
assessment and
evaluation of
of
the measurements
measurements and
and guidelines.
guidelines.
the
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MCDOCH007528
Financial Standard
the Financial
4. Do II meet
4.
meet the
Standard ififmy
myorganization
organizationachieves
achieves an
an overall
overall score
score of
of 66 or
or
greater?
criteria
Standard criteria
Financial Standard
TheFinancial
only. The
viabilityonly.
financialviability
determinefinancial
todetermine
usedto
system isis used
The point system
pay
and
timely
statements
financial
accurate
organization submit
also require that an organization
submit accurate financial statements timely and pay
McDonald’s and
McDonald's
andothers
otherson
ontime.
time. Also,
Also, ififdebt
debton
onthe
thefinancial
financialstatements
statements does
does not
not meet
meet
McDonald’s borrowing
McDonald's
borrowing standards,
standards,the
the Region
Regionwill
willrestate
restatethe
the debt
debt terms,
terms, which
which may
may affect
affect
overall score.
the overall
McDonald’s borrowing
If my
5. If
5.
my organization’s
organization's financing
financing arrangements
arrangements fall
fall outside
outside of McDonald's
Is this
standards, how is
standards,
this treated?
In determining
In
determining the
the financial
financial viability
viabilityof
ofan
anorganization,
organization,the
the Region
Region will
willrestate
restate any
any debt
debt that
that
standards.
borrowing standards.
McDonald’s borrowing
of McDonald's
falls outside
outside of
ratios?
my financial ratios?
affect my
non-recurring event affect
and/or non-recurring
6. How does a non-operating and/or
6.
reflected
and
GAAP
with
accordance
in
recorded in accordance with GAAP and reflected on
be recorded
should be
All business
All
business transactions should
on the
the
be
will
events
non-recurring
or
transactions
Any
appropriately.
statements
financial statements appropriately. Any transactions or non-recurring events will be
financial
transaction
financial viability
part of
as part
Region as
the Region
by the
evaluated by
of the
the financial
viabilityassessment
assessment where
where the
the transaction
as aa
such as
situations such
in situations
For example,
financial condition
overall financial
alters the overall
condition of
of the
the organization.
organization. For
example, in
and
business and
a significant
restaurant(s) where
sale of restaurant(s)
where a
significant amount
amount of
of cash
cash may
may come
come into
into the
the business
for
calculations for
ratio calculations
the ratio
from the
exduded from
be excluded
may be
draw may
the draw
out, the
drawn out,
subsequentlydrawn
be subsequently
then be
viability.
financial viability.
reviewingfinancial
of reviewing
purposes of
if II have
ratio, if
7. Do II get
7.
get the
the maximum
maximum 4 poInts,
points, under the
the cash flow coverage ratio,
have no
no debt
debt
regardless of what my net cash flow is?
points
level points
can only
service can
debt service
no debt
have no
who have
Owner/Operators who
No. Owner/Operators
No.
only achieve
achieve the
the highest
highest level
Draw.
and Draw.
G&A and
afterG&A
maintainedafter
flowisismaintained
cashflow
netcash
positive net
when positive
8. How is
8.
is equity percentage calculated?
Business
Value of
by the
divided by
Business divided
Debt on
Net Debt
Value of the
Value
the Business minus Net
on the
the Business
the Value
of the
the Business
— (Net
Business) —
of Business)
(Value of
(Net Debt)
Debt) == Equity
EquityPercentage
Percentage
Business)
(Value of Business)
(Value
•
Business:
Value of the Business:
Value
G&A ($35,000
G&A and
Service, G&A
Debt Service,
Cash Flow
Cash
Flow before Debt
and Draw
Draw less
less standard
standard G&A
($35,000 for
for
multiple
Flow multiple
Cash Flow
by Cash
multiplied by
satellites) multiplied
for satellites)
restaurants and $10,000
traditional restaurants
$10,000 for
formula,
this formula,
using this
25% using
than25%
lessthan
beless
to be
calculated to
percentage isis calculated
equity percentage
If the equity
4.5. If
of 4.5.
of
actual
(with actual
method (with
cash flow
director will
financial director
the financial
then the
will use
use aa discounted
discounted cash
flow method
business.
of the
value of
determine the
to determine
reinvestment) to
reinvestment)
the value
the business.
•
Debt):
(Net Debt):
Business (Net
the Business
Debt on the
Debt
Total Current Liabilities
Liabilitiesplus
plustotal
total Long-Term
Long-Term Liabilities
Liabilitiesminus
minusany
anyNotes
Notes Payable
Payable to
to
Current Assets.
minus Current
Stockholders minus
Stockholders
Assets.
NEP restaurants.
all NEP
for all
adjusted for
appropriately adjusted
be appropriately
will be
flow will
Both
restaurants.
Both debt and cash flow
liability turnover calculated?
ITM liability
9. How
HowisIsTTM
or
Positive or
Average Positive
TTM Average
represents TIM
It represents
The liability
The
liabilityturnover
turnover isiscalculated
calculatedover
overaaTrM
TIMperiod.
period. It
Daily Sales
Average Daily
by Average
Capital divided
Working Capital
Negative Working
divided by
Sales
5
5
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Negative Working
(Positive or Negative
Working Capital)
Capital) = Liability Turnover Ratio
Daily Sales)
Sales)
(Average Daily
•
Working Capital equals:
Working
Current Assets
Assets less
Current
less Current
Current Liabilities
•
Liabilities equals:
Current Liabilities
Total Current Liabilities
Minus: Current
CurrentPortion
PortionofofLong-Term
Long-Term Debt
Debt
Minus:
1/12 of
of Current
Current Portion
Portion of
of Long-Term
Long-Term Debt
Plus:
1/12
•
Sales equals:
Average Daily Sales
equals:
Sales divided
Total Annualized Sales
divided by 363
•
Under the point
point system,
system, points are
are assigned
assigned for
for aa positive
positive or
or negative
negative Liability
Turnover. Negative
Negative Liability
Liability Turnover
Turnover isis calculated
calculated ifif Working
Working Capital
Capital is
is a negative
amount (i.e., current liabilities
liabilities exceed
exceed current
current assets).
assets). Positive
Positive Liability Turnover is
calculated if Working Capital
Capital is aa positive
(i.e.. current
current assets
assets exceed
positive amount (i.e.,
exceed current
current
liabilities).
liabilities).
10. How is cash
10.
cash flow
flow coverage ratio calculated?
Cash Flow
Service (note: actual G&A is
Is used
Cash
Flow after
after G&A and
and Draw
Draw divided by Annual Debt Service
used in
this calculation)
calculation)
(Cash Flow
Cash Flow Coverage Ratio
(Cash
Flow after
after G&A and Draw) == Cash
Debt Service)
Service)
(Annual Debt
11. Does the
the Financial
Financial Standard
11.
Standard require
requireaaminimum
minimumamount
amountof
ofcash
cash be
be kept
kept in
inthe
the business?
business?
No. Overall
Overall financial
financial viability
viability as
as part
part of
of the
the Financial
Financial Standard
Standard must be
No.
be met.
met.
Peoole
People
1. What does "having
“having an
number of shift-certified or shift verified managers"
managers”
1.
an adequate number
mean?
managers is the
so that
each shift is
An adequate number of shift-certified
shift-certified managers
the number required so
that each
by a shift-certified manager
manager and will vary based
based on
run by
on hours
hours of
of operation.
operation.
Is required
required for
to be
be Shift
Shift Certified
Certified with BSM
BSM being
2. What is
for an
an employee
employee to
being phased
phased out
out with
the transition
transition to
to Restaurant
Restaurant Department Management
Management (RDM)
(RDM) classes?
the
classes?
Serve Safe
A Shift Certified Manager must be Serve
Safecertified,
certified, be
beShift
ShiftVerified
Verified in
inthe
the restaurant
restaurant
have successfully
and have
successfullycompleted
completedIntroduction
Introduction to
to Management (ITM)
(ITM) or the previous
equivalent (i.e.,
(i.e., BOC,
BOC, BSM).
BSM).
equivalent
3.
3. If
If an
Introduction to
an Owner/Operator
Owner/Operator has
has aa shift
shift manager
manager that
that Isis ready
ready and
and able
able to
to attend Introduction
Management
(ITM),
but
the
manager
is
waiting
on
class
availability
to
open
Management (ITM), but the
is waiting on class availability to open or aa class has
cancelled, will
will this be held against the Owner/Operator?
been cancelled,
No. McDonald's
McDonald’s acknowledges
acknowledges that
may take some
No.
that itit may
some time
time to
to schedule
schedule shift
shift running
running
managers to
managers
to ITM
ITM class.
class. Any
AnyOwner/Operators
Owner/Operators ininthis
thissituation
situation should
shouldwork
workwith
with their
their
Region to
shift running
runningmanagers
managers certified
certifiedas
as soon
soon as
as is
is practical.
Region
to develop aa plan
plan to
to get their
their shift
practical.
6
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4.
4.
Are satellites
required to
to have
haveHU/ROLP/GM
FlU/ROLP/GM Capstone
Are
satellites required
Capstone trained
trained managers?
managers?
No, typically
restaurants are
are not
notrequired
required to
tohave
haveHU/ROLP/GM
HU/ROLP/GM Capstone
No,
typically satellite
satellite restaurants
Capstone trained
trained
managers. However,
However, the
thesatellite
satelliterestaurant's
restaurant’sfranchising
franchising documents
documents may
may require
require an
an
managers.
HIJ/ROLP/GM Capstone
HU/ROLP/GM
Capstonetrained
trained manager.
manager.
5.
5.
An Owner/Operator
The survey
survey
An
Owner/Operator organization
organizationconducts
conductsan
anemployee
employee commitment
commitment survey.
survey. The
scores are
are much
much lower
lower than
Owner/Operator would
like. As
As aa result,
result the
the organization
organization
scores
than the
the Owner/Operator
would like.
creates and
and implements
implements an
an action
Will the
creates
action plan
plan to
to address
address the
the deficiencies.
deficiencies. Will
the low
low
commitment score
score cause
cause this
this organization
organization to
meet the
the People
People Standard?
Standard?
commitment
to not
not meet
No. This
No.
This Standard
Standard requires
requiresconducting
conductingthe
the survey
survey and
and reviewing
reviewing the
the feedback.
feedback.
6.
6.
Does the
the Owner/Operator
Owner/Operator have
have to
to use
usethe
theMcDonald's
McDonald’sapproved
approved Manager
Manager and
and Crew
Crew
Does
Commitment Survey?
Survey?
Commitment
No. However,
However, the
the Owner/Operator
Owner/Operator must
must have
feedback process
process in
in
No.
have an
an effective
effective employee
employee feedback
place. As
As part
part of
of this
this process,
process, the
the Owner/Operator
Owner/Operator must
must gather
gather and
place.
and review
review anonymous
anonymous
feedback from
from the
the management
management and
and crew
crew at
at each
each restaurant
restaurant at
at least
least annually.
annually.
feedback
7.
7.
Can you
provide more
more details
details on
on our
our People
People Migration
Migration Strategy?
Can
you please
please provide
Strategy?
The People
People Migration
Migration Strategy
Strategy isIs aa three-tiered
three-tieredapproach
approachincluding
includingBHOT'r,
BHOT’r, Shift
Shift
The
Management Excellence
Excellence and
Management
and Restaurant
RestaurantDepartment
DepartmentManagement.
Management. Consistent
Consistent use
use of
of the
the
migration tactics
supports crew
benefits, hiring,
hiring, orientation,
migration
tactics supports
crew benefits,
orientation, training
training and
and retention
retention with
with
extended focus
focuson
onShift
Shift Managers
Managers with
with Shift
Shift Management
Excellence. Restaurant
Restaurant
extended
Management Excellence.
Department Management
of the
strategy with
with aa management
Department
Management serves
serves as
as the
the capstone
capstone of
the strategy
management
structure, curriculum
helps
structure,
curriculumand
andmanagement
managementsupport
supporttools.
tools. Consistent
Consistent use
use of
of these
these tactics
tactics helps
to
provide
a
foundation
of
highly
skilled
and
motivated
restaurant
employees.
to provide a foundation of highly skilled and motivated restaurant employees.
8.
What are
examples of
of McDonald's
McDonald’s training/meetings
a
What
are some
some examples
training/meetings that
that would
would demonstrate
demonstrate a
General Manager
General
Manager has
has remained
remained current
current with
with restaurant
restaurant operations
operations each
each year?
year?
Some examples
examples include,
include, but
but are
are not
notlimited
limited to,
to,participation
participation at
at Regional,
Regional, Division
Division and
and
Some
National meetings
meetings such
such as
as Seed
Seed Stores,
Stores,Plan-to-Win
Plan-to-Win Road
Road Shows,
Shows, Manager
Manager Rallies,
Rallies,
National
Operations Summits,
Summits, COMR.,
COMR., Business
It is
is important
important that
that General
General
Operations
BusinessAlignment
Alignmentmeetings,
meetings, etc.
etc. It
Managers stay
of our
our
Managers
stay current
current with
with restaurant
restaurantoperations
operationsbecause
becausethe
the continued
continued success
success of
System is
is founded
founded on
on having
having highly
highly skilled
The
System
skilled and
and motivated
motivated restaurant
restaurant employees.
employees. The
ongoing training
training and
of our
our General
General Managers
Managers is
retaining
ongoing
and development
development of
is essential
essential to
to retaining
qualified personnel
to operate
operate and
and build
build the
the McDonald's
McDonald’s business.
business.
qualified
personnel to
9.
How will
10 hours
hours of
of continuing
continuing education
education for
for General
General Managers
Managers be
How
will the
the 10
be tracked?
tracked?
The
Owner/Operator
will
have
the
responsibility
and
flexibility
to
track
10 hours
hours of
of
The Owner/Operator will have the responsibility and flexibility to track the
the 10
continuing
education
for
their
General
Managers
in
a
manner
best
suited
for
their
continuing education for their General Managers in a manner best suited for their
organization.
Buildina the
Building
the Business throueh
through Guest Satisfaction
1. What
Whatdoes
doesititmean
meantotohave
haveall
allshifts
shiftsadequately
adequatelystaffed
staffedwith
with trained
trained crew
crew and
and
1.
management to
to maximize
maximize sales?
management
Adequately staffed
for aa shift
Adequately
staffed for
shift means
means having
having enough
enoughtrained
trainedemployees
employees on
on the
the floor
floor to
to meet
meet
the projected
projected sales
sales and
and satisfy
satisfy guests.
Restaurants that
that have
have shifts
the
guests. Restaurants
shifts adequately
adequately staffed
staffed to
to
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any
quickly to
respond quickly
expectations,respond
guest expectations,
the guest
or exceed
maximize sales
maximize
sales are
are able
able to
to meet
meet or
exceed the
to any
potential.
maximize sales
and maximize
concerns, and
guest concerns,
sales potential.
support for System
an Owner/Operator showing support
of an
examples of
2. What are
2.
are some
some examples
System promotions,
promotions,
recommendations and initiatives?
in
supported in
consistently supported
initiatives should
and initiatives
recommendations and
promotions, recommendations
System promotions,
should be
be consistently
work collaboratively
We work
Owner/Operator organization.
an Owner/Operator
of an
restaurant of
each restaurant
organization. We
collaboratively together
together with
with
forward.
business forward.
drive the
Win isis designed
Plan to
our Plan
ensure our
Owner/Operators to ensure
to Win
designed to
to drive
the business
activities,
Examples include,
Examples
include,but
but are
are not
not limited
limitedto,
to, new
new product
product launches,
launches, promotional
promotional activities,
may
Owner/Operator may
an Owner/Operator
concerns an
Any concerns
offerings. Any
value offerings.
and value
operation and
of operation
hours of
extended hours
(such
initiative
or
recommendation
promotion,
System
a
of
regarding the
have regarding
have
the support
support of a System promotion, recommendation or initiative (such as
as
organization should
Owner/Operator organization
restaurant of
specific restaurant
for aa specific
hours) for
extended hours)
extended
of the
the Owner/Operator
should be
be
Team.
Service Team.
Field Service
or Field
VP or
QSCVP
theQSC
withthe
discussed with
discussed
3. Are “special
"special venue”
venue" restaurants
restaurants required
required to
to participate
participate in
in all
all System
System promotions?
promotions?
OPNAD and
the OPNAD
when the
situations when
will be situations
No, there will
No,
and Co-Op
Co-Opendorsed
endorsed promotions
promotions cannot
cannot be
be
Region
the Region
and the
Owner/Operator and
the Owner/Operator
out, the
rolled out,
promotion isis rolled
newpromotion
Beforeaa new
implemented. Before
should discuss
should
discuss whether
whether there
there are
are circumstances
circumstancesthat
thatwould
would prevent
prevent the
the owner/operator
owner/operator
products or
certain products
from selling certain
or participating
participatinginincertain
certainpromotions
promotionsat
atthese
these locations.
locations.
this Standard?
4. How will
will mystery
mystery shop
shop results
results be
be used when assessing this
an
Standard and
this Standard
in this
tool in
Mystery Shop
Mystery
Shop scores
scores are
are not
not aa measurement
measurement tool
and will
will not
not cause
cause an
will
results
the
However,
Owner/Operator organization
organization to
to fail
failto
to meet
meet this
this Standard.
Standard. However, the results will be
be
information
of
source
additional
an
provide an additional source of information and
they provide
as they
discussed as
and can
can help
help to
to develop
develop
Mystery Shop
See Mystery
insightful commentary
insightful
commentary within
withinOwner/Operator
Owner/Operatorbusiness
businessreviews.
reviews. See
Shop memo
memo
points
key points
list
or
memo
attach
to
wants
(Marion
details.
further
for
2011
3,
issued October
details. (Marion wants to attach memo or list key
think they
doesn’t think
or leave it off-she doesn't
they can
can find
find the
the memo)
memo)
Standard?
this Standard?
assessing this
S. How will
5.
will the
the number
number of
of guest
guest complaints
complaints be used when assessing
and
Standard and
this Standard
in this
measurement in
as aa measurement
used as
longer used
no longer
is no
complaints is
The number
number of guest complaints
organization
Rather, the
Standard. Rather,
this Standard.
Owner/Operator to
an Owner/Operator
will not cause an
will
to fail
fail to
to meet
meet this
the organization
August 30,
dated August
Complaint memo
Customer Complaint
See Customer
back responsiveness.
call back
on call
should focus on
responsiveness. See
memo dated
30,
further details.
2011 for further
“All shifts
6. Does the "All
shifts adequately
adequately staffed
staffed to maximize
maximize sales”
sales" guideline
guideline contained
contained in
in the
the
6.
Building the
Building
the Business
Business through
through Guest
Guest Satisfaction
Satisfaction Standard
Standard requires
requires aa restaurant
restaurant to
to adopt
adopt
extended hours?
staffing
“maximizing sales”
to "maximizing
guideline to
this guideline
in this
reference in
The reference
No.
sales" refers
refers to
to adequately
adequately staffing
No. The
be aa
should be
them
implement
to
decision
the
and
hours
or extended hours and the decision to implement them should
hours or
24 hours
existing
shifts. 24
existing shifts.
Region.
the
and
Owner/Operator
the
between
discussion
discussion
the Owner/Operator and the Region.
“by providing
maximize sales "by
to maximize
7. What does it mean to
providing reliable,
reliable,competitive
competitive value
value to
to the
the
7.
guest”?
guest"?
McDonald’s
visit aa McDonald's
they visit
time they
every time
value every
compelling value
offers compelling
that offers
menu that
Our
guests expect aa menu
Our guests
our guests,
remain competitive
order to
in order
Accordingly, in
restaurant Accordingly,
restaurant.
to remain
competitive and
and relevant
relevant to
to our
guests,
McDonald’s restaurants
McDonald's
restaurants must
must offer
offer aa value
value platform
platformwhich
whichisisconsistent
consistent with
withthese
these
market to
from market
vary from
and vary
timeand
overtime
evolveover
will evolve
valuewill
competitivevalue
Reliable, competitive
expectations. Reliable,
to
market.
8
8
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8. The
TheOwner/Operator
Owner/Operatorisisunable
unable to
toreach
reach aa guest
guest that
that called
called the
the 800#
800# with
with aa complaint.
complaint.
8.
Will this
meets the
the Building
BuildIng the
Business through
through
Will
this impact
impact whether
whether the
the Owner/Operator
Owner/Operator meets
the Business
Guest Satisfaction
Satisfaction Standard?
Standard?
Guest
If the
If
the Owner/Operator
Owner/Operatorhas
hasmade
madereasonable
reasonableattempts
attemptsto
to contact
contact the
the guest
guest and
and has
has aa guest
guest
recovery process
process in
in place,
place, failure
recovery
failure to
to reach
reach that
that guest
guest will
will not
not be
be held
held against
against the
the
Owner/Operator.
Owner/Operator.
OwnerlOnerator Involvement
Owner/Operator
1.
1.
Is itit acceptable
Is
acceptable for
for an
an Owner/Operator
Owner/Operator to
to disagree
disagree or
or challenge
challenge the
the Company
Company on
on issues
issues
and policies?
policies?
Yes, as
McDonald’s encourages
Yes,
as long
long as
as it
it is
is done
done in
in aa professional
professional and
and constructive
constructive manner.
manner. McDonald's
encourages
spirited
debate
or
individual
initiative
that
is
done
in
the
best
interest
System.
spirited debate or individual initiative that is done in the best interest of
of the
the System.
2.
2.
Participation in
in OPNAD
OPNAD and
If an
an
Participation
andthe
the Co-Op
Co-Opisisvoluntary
voluntaryunder
underthe
theFranchise
FranchiseAgreement
Agreement. If
Owner/Operator isIs not
not aa member
memberof
ofOPNAD
OPNAD or
local Co-Op,
Co-Op, will
Owner/Operator
or the
the local
will this
this Owner/Operator
Owner/Operator
meet the
theOwner/Operator
Owner/Operator Involvement
Involvement Standard?
Standard?
meet
No. The
No.
The National
National Franchising
FranchisingStandards
Standardsrequire
requirean
anOwner/Operator
Owner/Operatorto
tobe
be aa member
member of
of both
both
OPNAD and
OPNAD
andthe
the appropriate
appropriatelocal
localCo-Op
Co-Opeven
eventhough
thoughthe
the Franchise
FranchiseAgreement
Agreementdoes
does not.
not.
3.
3.
A requirement
A
requirement that
that Owner/Operators
Owner/Operators remain
remain current
currentwith
withthe
thebusiness
business has
has been
been added
added to
to
the Owner/Operator
Owner/Operator Involvement
Involvement Standard.
How will
the
Standard. How
will this
this be
be measured?
measured?
An Owner/Operator
business through
An
Owner/Operator must
must be
be aa student
student of
of the
the business
through ongoing
ongoing education.
education.
Remaining current
following:
Remaining
currentwith
withthe
thebusiness
businesscan
can be
be achieved
achieved by
by completing
completing one
one of
of the
the following:
Participating inin McDonald’s
each year.
year. OR
OR
•
Participating
McDonald'smeetings,
meetings,conventions,
conventions, and
and events
events each
Attending an
an Owner/Operator
based HU
HU training
•
Attending
Owner/Operator based
training class
class within
withinthe
the past
past 10
10 years.
years.
OR
Attending the
GM capstone
past 10
10 years.
years. OR
OR
•
Attending
the GM
Capstone class
class within
within the
the past
Participating on
•
Participating
onaaMcDonald’s
McDonald'ssystem
systemteam
teamwithin
withinthe
the past
past 18
18 months
months
(Examples include,
include,but
butare
arenot
notlimited
limitedto,to,
NIC,DLC,
DLC,RLC,
RIC, OPNAD,
(Examples
NLC,
OPNAD, regional,
regional,
teams, divisional
divisional teams
teams or
or sub
sub teams)
teams) OR
OR
teams,
Sponsoring aa McDonald's
McDonald’s training
••
Sponsoring
trainingclass
classwithin
withinthe
the past
past 18
18 months.
months.
9
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M0D0CHô07528 •
MCDOCH007528
National Franchising
Franchising Standards
National
Standards
FAQs asasofof12/1/13
FAQs
12/1/13
(Effective 04/01/14)
(Effective
04/01/14)
The following
FAQ’s are
the National
National Franchising
Franchising Standards
The
following FAQ's
are intended
intended to
to add
add texture
texture to
to the
Standards and
and the
the
Measurements
and
Guidelines.
The
Measurements
and
Guidelines
are
used
to
assess
whether
Measurements and Guidelines. The Measurements and Guidelines are used to assess whether
the performance
performance and
and results
results of
the Owner/Operator
Owner/Operator and
the
of the
and his/her
his/her organization
organization meet
meet the
the
Standards.
General Questions
General
1. Have
Havethe
theNational
NationalFranchising
Franchising Standards
Standards changed?
1.
changed?
Yes, the
National Franchising
Franchising Standards
Yes,
the National
Standards(the
(the“Standards”)
"Standards")have
haveevolved
evolvedtotomeet
meetthe
the needs
needs
of our
our business.
The enhancements
enhancementsprovide
provide an
an opportunity
opportunity to
elevate the
the Brand,
Brand,
of
business. The
to elevate
communicate what
what it
it takes
takes to
to be
be successful
successful in
in our
our business
business and
and further
communicate
further distance
distance ourselves
ourselves
from the competition.
from
Each of
(What are
trying
Each
of the
the six
six Standards
Standards now
now includes
includes an
an aspirational
aspirational Vision
Visionstatement
statement (What
are we
we trying
to
accomplish?)
and
a
Purpose
statement
(Why
are
we
doing
it?),
which
help
to
incorporate
to accomplish?) and a Purpose statement (Why are we doing it?), which help to incorporate
the McDonald's
McDonald’s values
values into
into the
the National
National Franchising
Franchising Standards.
The addition
addition of
of the
the Vision
Vision
the
Standards. The
and Purpose
Purpose statements
statementsprovides
providesadditional
additional clarity
clarity to
to the
the Standards
Standards and
and reminds
reminds all
all of
us
and
of us
what we
we are
are trying
trying to accomplish.
accomplish.
what
The Standard
done?) has
has also
also been
been revised
revised while
while additional
additional
The
Standardstatement
statement (What
(What needs
needs to
to be
be done?)
measurements and
and guidelines
guidelines (Is
(Is itit being
of the
six
measurements
being done?)
done?) have
have been
been added
added to
to each
each of
the six
Standards.
Other significant
significant changes
to the
theNational
National Franchising
Franchising Standards
Standards include:
include:
Other
changes to
Reinvestmentisis aa new
newStandard,
Standard, independent
independentofofthe
theFinancial
Financial Standard.
Standard.
o Reinvestment
o The
The Operations
Standard now
has an
in addition
addition to
a
Operations Standard
now has
an organizational
organizational measurement
measurement, in
to a
restaurant measurement.
restaurant
The Financial
Financial Standard
to determine
determineFinancial
Financial Viability
Viability
o The
Standard has
has aa point
point system
system to
In the
Standard, General
General Managers
o
In
the People
People Standard,
Managers must
must remain
remain current
current with
with the
the business
business
by demonstrating one of
of the
the following
following each
each year:
year:
by
• Participated
Participated in
restaurant
■
in 10
10 hours
hours of
of McDonald’s
McDonald'straining/meetings
training/meetings on
on restaurant
operations. OR
OR
operations.
• Passed
Passed the
current GM
GM Capstone
■
the current
Capstone proficiency
proficiency test.
test.
Customer Satisfaction
o Customer
Satisfaction is
is now
now the
the Building
Building the
the Business
Business through
through Guest
Guest Satisfaction
Satisfaction
Standard and
supporting the
Plan to
Win.
Standard
and includes
includes supporting
the Plan
to Win.
The Owner/Operator
Involvement Standard
Standard now
includes aa requirement
o The
Owner/Operator Involvement
now includes
requirement to
to stay
stay
current with
business through
through continuous
continuous-learning
current
with the
the business
learning activities.
activities.
2. What
Whatisisthe
thepurpose
purposeofofthe
theNational
NationalFranchising
Franchising Standards?
Standards?
2.
The National
National Franchising
Franchising Standards
basis for
all franchising
induding
The
Standards form
form the
the basis
for all
franchising decisions
decisions including
growth,
rewrite
and
eligibility
for
participation
in
certain
programs
and
incentives.
Each of
of
growth, rewrite and eligibility for participation in certain programs and incentives. Each
the six
six Standards
Standards is
McDonald’s System.
The
the
is critically
criticallyimportant
importantto
tothe
thesuccess
success of
of the
the McDonald's
System. The
National Franchising
U.S.
National
FranchisingStandards
Standardsare
areintended
intendedto
to be
be applied
applied consistently
consistently across
across the
the U.S.
business and
and do
do not
not change
change or
or supplement
supplement the
the Franchise
Franchise Agreement.
Agreement.
business
1
1
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3.
When will
will McDonald's
McDonald’s begin
begin applying
applying the
revised National
National Franchising
Franchising Standards
When
the revised
Standards and
and the
the
revised measurement
measurement tools
tools and
and guidelines?
revised
guidelines?
The revised
revised National
National Franchising
Franchising Standards
Reviews taking
The
Standards will
willbe
be used
used for
for all
all Business
Business Reviews
taking place
place
after April
This will
prepare for
and understand
understand
after
April 1,
1, 2014.
2014. This
will allow
allow ample
ample time
time for
for the
the System
System to
to prepare
for and
the revisions
revisions to
the Standards.
Standards. If
If there
and
the
to the
there are
are situations
situations where
where the
the measurements
measurements and
guidelines associated
associatedwith
withthe
therevised
revisedNational
NationalFranchising
Franchising Standards
Standards result
result in
in aa
guidelines
determination of
of ineligibility
ineligibility where
Owner/Operator previously
determination
where the
the Owner/Operator
previously would
would have
have been
been
considered eligible
eligible for
for growth
considered
growth and
and rewrite,
rewrite, there
there will
will be
be communication
communication with
with the
the
Owner/Operator prior
prior to
Owner/Operator becoming
becoming ineligible
ineligible for
for growth
and rewrite
rewrite
Owner/Operator
to the
the Owner/Operator
growth and
regarding the
and timing
timing of
compliance.
regarding
the expectations
expectations and
of compliance.
4.
Does an
an Owner/Operator's
Owner/Operator’s organization
organization have
have to
to meet
meet all
all six
six of
of the
theNational
National Franchising
Franchising
Does
Standards
to
be
eligible
for
growth,
rewrite
and
to
be
eligible
to
participate
in
certain
Standards to be eligible for growth, rewrite and to be eligible to participate in certain
programs and
programs
and incentives?
Yes. Each
Each Standard
Standard isis critically
McDonald’s System.
Yes.
criticallyimportant
importantto
tothe
thesuccess
success of
of the
the McDonald's
System.
Owner/Operators must
must meet
meet each
each Standard
Standard and
and be
be in
in compliance
with the
the Franchise
Franchise
Owner/Operators
compliance with
Agreement to
to be
be considered
considered eligible
eligible for
for growth
growth and
and rewrite
rewrite and
be eligible
eligible to
participate
Agreement
and to
to be
to participate
in certain
need to
to be
bespecific
specificabout
aboutprograms
programslike
like MRP?
MRP?
in
certain programs
programs and
and incentives.
incentives. Do
Do we
we need
Rebuild?
Rebuild?
5.
How will
National
How
will McDonald’s
McDonald'scommunicate
communicate an
an Owner/Operator’s
Owner/Operator's status
status relative
relative to
to the
the National
Franchising Standards?
Franchising
Standards?
Generally, each
Generally,
each Owner/Operator
Owner/Operator organization
organization will
will receive
receive aa Business
Business Review
Review at
at least
least every
every
18 months.
months. Generally,
Generally, any
any Owner/Operator
Owner/Operator organization
organization that
that isis ineligible
ineligible for
for growth
growth and
and
18
rewrite will
The Region
Region will
rewrite
will receive
receive aa Business
Business Review
Review every
every 12
12 months.
months. The
will evaluate
evaluate the
the
Owner/Operator’s performance
and guidelines
Owner/Operator's
performance relative
relativeto
tothe
the measurements
measurements and
guidelines of
of each
each
Standard.
During
the
Business
Review,
Regional
Management
will
communicate
Standard. During the Business Review,• Regional Management will communicate the
the
Owner/Operator’s eligibility
eligibility status for growth and
and rewrite.
rewrite.
Owner/Operator's
In addition,
an Interim
Interim Business
updating their
In
addition, an
an Owner/Operator
Owner/Operator may
may receive
receive an
Business Review
Review updating
their
eligibility status
a
eligibility
status ifif itit becomes
becomes apparent
apparent that
that the
the organization
organization isis not
not meeting
meeting or
or now
now meets
meets a
Standard.
6.
If an
Q$C VP
a
If
an Owner/Operator
Owner/Operator disagrees with the QSC
VPon
onwhether
whetherthe
the organization
organization meets
meets a
Standard, what
Standard,
what are
are his/her
his/her options?
options?
As with
and disputes
within McDonald's,
McDonald’s, our
As
with all
all issues
issues and
disputes within
our “open
"open door”
door" policy
policy (e.g.,
(e.g., appealing
appealing to
to
the Ombudsman
Ombudsman or
or higher
higher levels
of McDonald's
McDonald’s management)
would apply.
apply.
the
levels of
management) would
7.
Under what
term franchise
franchise
Under
what circumstances
circumstances could
could an
an Owner/Operator
Owner/Operator not
not be
be offered
offered aa new
new term
(rewrite)
even
though
the
Owner/Operator
is
eligible
for
growth
and
rewrite?
(rewrite) even though the Owner/Operator is eligible for growth and rewrite?
Typically, this
Typically,
thiswould
would only
onlyoccur
occurififthe
the restaurant
restaurantwas
wasclosing
closingdue
dueto
to aa lack
lackof
of real
realestate
estate
or changes
changes in
in the
the trading
trading area.
tenure or
ODerations
Operations
1. Previously,
Previously,the
theOperations
OperationsStandard
Standardonly
onlymeasured
measuredgraded
gradedROIP
ROIP visits
visits at
at an
an individual
individual
1.
restaurant level.
Why has
measurement been
beenadded
addedfor
forgraded
gradedROIP
ROIP visits
restaurant
level. Why
has aa new
new measurement
visits at
at the
the
Owner/Operator organization
Owner/Operator
organization level
level as
as well?
2
HIGHLY CONFIDENTIAL
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The changes
the Operations
Operations Standard
The
changes to
to the
Standardare
areintended
intendedto
to demonstrate
demonstrate our
our commitment
commitment to
to
our guests
by delivering
delivering the
the highest
highest levels
levels of
ofQS&C
QS&C and
our
guests by
and Food
Food Safety,
Safety, while
while not
not deviating
deviating
from the
ROIP process.
from
the ROIP
process. We
We believe
believe that
that this
this Standard,
Standard, when
when measured
measured only
only at
at the
the
individual restaurant
assess an
an Owner/Operator's
Owner/Operator’s overall
overall
individual
restaurant level,
level, does
does not
not adequately
adequately assess
operational performance.
performance. Previously,
Previously, an
an organization
organization could
could fail
fail as
as many
many as
as 67%
67% of
operational
of their
their
graded visits
visits in
in an
an ROIP
ROIP cycle,
Operations Standard.
Standard.
graded
cycle,and
andyet
yet still
stillmeet
meet the
the Operations
We will
will continue
to use
useexisting
existingresources,
resources,including
includingFORs,
FORs, SORs
SORs and
Procedure
We
continue to
and Food
Food Safety
Safety Procedure
Verifications to
whether aa restaurant
restaurant and
and an
an Owner/Operator's
Owner/Operator’s organization
organization
Verifications
to determine
determine whether
meet the
the Operations
Operations Standard.
Standard. Please
Please refer
refer to
to the
theupdated
updated Operations
Operations Standard
Standard for
for details
details
meet
on the
the Organization
Organization measurement
as applied
applied to
Owner/Operator organizations
on
measurement as
to Owner/Operator
organizations with
with one,
one,
two, three,
three, four
four and
and five
five or
or more
more restaurants.
restaurants.
two,
2.
Does a
a restaurant
restaurant that
audit meet
meet the
the Operations
Operations Standard?
Standard?
Does
that fails
fails only
only one
one food
food safety
safety audit
In
most
cases,
yes.
However
the
severity
of
the
food
safety
issues
may
require
a different
different
In most cases, yes. However the severity of the food safety issues may require a
answer.
3.
An Owner/Operator
McDonald’s operational
An
Owner/Operator acquires
acquires aa restaurant
restaurantthat
that does
does not
not meet
meet McDonald's
operational
standards. During
During the
standards.
the first
first few
few months
months after
after the
the acquisition,
acquisition, the
the restaurant
restaurant receives
receives
graded visits
meet the
the Operations
Operations Standard.
Standard. How
How will
will this
graded
visits that
that do
do not
not meet
this impact
impact the
the
Owner/Operator’s eligibility
eligibility for growth
Owner/Operator's
growth and
and rewrite?
This situation
will be
given aa
This
situation will
willnot
not impact
impactthe
the Owner/Operator’s
Owner/Operator'sstatus
status as
as he/she
he/she will
be given
reasonable period
period of
raise that
The
reasonable
of time
time to
to raise
that restaurant’s
restaurant's operations
operationsto
to an
an acceptable
acceptable level.
level. The
appropriate time
should be
be discussed
discussed with
with the
the QSC
USC VP
acquisition.
appropriate
time frame
frame should
VPat
atthe
the time
time of
of the
the acquisition.
Please refer
refer to
to the
the QSC
USC playbook
information on
graded visits
visits occurring
occurring after
after aa
Please
playbook for
for more
more information
on graded
change of
of ownership
ownership takes
takes place.
place.
change
4.
4.
If an
meet the
the Operations
Operations Standard
Standard and
and
If
an Owner/Operator
Owner/Operator sells
sells aa restaurant
restaurant that
that does
does not
not meet
all
of
the
other
restaurants
in
the
organization
do
meet
the
National
Franchising
all of the other restaurants in the organization do meet the National Franchising
Standards, is
Owner/Operator now
eligible for
for growth
and rewrite?
Standards,
is the
the Owner/Operator
now eligible
growth and
rewrite?
Assuming the
all the
National
Assuming
the Owner/Operator’s
Owner/Operator's organization
organization has
has consistently
consistently met
met all
the National
Franchising Standards
organization
Franchising
Standardsat
attheir
theirremaining
remainingrestaurants,
restaurants,the
the Owner/Operator
Owner/Operator organization
would likely
likely become
eligible for
for growth
growth and
and rewrite
rewrite upon
upon selling
selling its
its only
only restaurant
would
become eligible
restaurant in
in the
the
Improvement Process
Process for
for Underperforming
Underperforming Restaurants
Restaurants (IPUR).
(IPUR). However,
However, the
theQ5C
USC VP
VP may
Improvement
may
not immediately
immediately support
support the
Owner/Operator’s growth
circumstances that
not
the Owner/Operator's
growth based
based on
on the
the circumstances
that
caused the
the sold
sold restaurant
restaurant to
to not
not meet
meet the
theOperations
Operations standard
standard in
in the
the first
first place.
place.
caused
5.
Is an
from
Is
an Owner/Operator
Owner/Operator eligible
eligible for
for growth
growth and
and rewrite
rewrite once
once aa restaurant
restaurant Is
is removed
removed from
IPUR
and
placed
back
into
the
normal
ROIP
process?
IPUR and placed back into the
ROIP process?
Depending on
fads and
and circumstances,
circumstances, some
some Owner/Operators
Owner/Operators will
will be
eligible for
Depending
on the
the facts
be eligible
for
growth
and
rewrite
immediately
after
coming
out
of
IPUR.
However,
some
growth and rewrite immediately after coming out of IPUR. However, some
Owner/Operators may
eligible for
Owner/Operators
may not
not immediately
immediately become
become eligible
for growth
growth and
and rewrite
rewrite once
once the
the
restaurant is
is removed
removed from
from IPUR
IPUR and
back into
normal ROIP
ROIP process.
restaurant
and placed
placed back
into the
the normal
process. Rather,
Rather, the
the
organization must
all restaurants
organization
must demonstrate
demonstrate that
that it
it can
can operate
operate all
restaurants at
at aa level
levelthat
that meets
meets
McDonald’s USC
McDonald's
QSCstandards
standardsconsistently
consistently over
over aa period
period of
of time.
time.
If an
upon coming
coming out
out of
ofIPUR,
IPUR, the
If
an Owner/Operator
Owner/Operator is
is not
not eligible
eligible for
for growth
growth and
and rewrite
rewrite upon
the
USC VP
organization will
will
QSC
VPwill
willcommunicate
communicatethe
thetime
timeperiod,
period,up
upto
totwelve
twelve months,
months, that
that the
the organization
remain ineligible
If during
remain
ineligible for
for growth
growth and
and rewrite.
rewrite. If
duringthat
that time
time period,
period, the
the Owner/Operator
Owner/Operator
consistently meets
meetsall
all of
ofthe
theNational
NationalFranchising
Franchising Standards,
Standards, the
the organization
organization will
will regain
regain its
its
consistently
3
HIGHLY CONFI
DENTIAL
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CONFIDENTIAL
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eligibility for
period. Periodic
Periodic updates
updates regarding
regarding
eligibility
for growth
growth and
and rewrite
rewrite at
at the
the end
end of
of this
this time
time period.
the
organization’s
status
and
the
restaurant’s
performance
against
McDonald’s
operational
the organization's status and the restaurant's performance against McDonald's operational
standards should
should be
be communicated
communicated to
to the
the Owner/Operator
Owner/Operator while
while the
the organization
organization remains
remains
standards
ineligible.
Reinvestment
Reinvestment
1.
1.
Why is
which was
was previously
previously reviewed
reviewed as
asaa part
part of
ofthe
theFinancial
Financial Standard,
Standard,
Why
is Reinvestment,
Reinvestment, which
now an
an independent
Independent Standard?
Standard?
now
With Reinvestment
standard, we
better identify
identify
With
Reinvestment as
as an
an independent
independent standard,
we will
will be
be able
able to
to better
Owner/Operator organizations
organizations that
that are
are not
not financially
financially viable,
that just
just fail
fail
Owner/Operator
viable, rather
rather than
than those
those that
to reinvest.
reinvest
to
2.
Does every
every restaurant
restaurant in
in an
National
Does
an Owner/Operator’s
Owner/Operator's organization
organization have
have to
to meet
meet the
the National
Restaurant
Building
and
Equipment
Standards
(“NRBES”)
to
meet
the
Reinvestment
Restaurant Building and Equipment Standards ("NRBES") to meet the Reinvestment
Standard?
Standard?
Yes. However,
However, ifif one
oneor
or more
more of
ofan
an Owner/Operator's
Owner/Operator’s restaurants
restaurants do
do not
not meet
meetthe
theNRBES
NRBES
Yes.
requirements, but
but the
theOwner/Operator
Owner/Operatorand
andthe
theQSC
QSC VP
VP mutually
plan
requirements,
mutually agree
agree upon
upon aa written
written plan
(not to
to exceed
exceed18
13months)
months)totobring
bringthe
therestaurants
restaurantsup
upto
toNRBES
NRBES requirements,
(not
requirements, then
then the
the
organization will
will be
be considered
considered as
as meeting
meeting the
the Standard.
Standard.
organization
Financial
1.
The Financial
Financial Standard
The
Standardrequires
requiresthat
that an
an Owner/Operator
Owner/Operator must
must pay
pay McDonald’s
McDonald's and
and others
others
on time.
time. What
What ifif an
an Owner/Operator
Owner/Operator has
has not
is disputing
disputing an
an amount
on
not paid
paid because
because he/she
he/she is
amount
due?
Legitimate disputes
regarding payment
Legitimate
disputes regarding
payment will
willnot
not cause
cause an
an Owner/Operator
Owner/Operator to
to fail
failto
to meet
meet
this
Standard.
However,
if
a
dispute
arises
with
McDonald’s
or
other
vendors,
it
remains
this Standard. However, if a dispute arises with McDonald's or other vendors, it remains the
the
responsibility of
as possible.
possible.
responsibility
of the
the Owner/Operator
Owner/Operatorto
to resolve
resolvethese
these issues
issues as
as soon
soon as
2.
Does an
an Owner/Operator
Owner/Operator fail
fall to
meet the
the Financial
Financial Standard
occasionally
Does
to meet
Standard Ififhe/she
he/she occasionally
submits financial
days late?
submits
financial statements
statements a few
few days
late?
Occasionally submitting
an
Occasionally
submitting financial
financialstatements
statements aa few
few days
days late
late will
will not
not cause
cause an
Owner/Operator to
to fail
fail to
meet the
the Financial
Financial Standard.
However, itit is
is the
responsibility of
of
Owner/Operator
to meet
Standard. However,
the responsibility
Owner/Operator to
to insure
insure they
they meet
meetall
all deadlines
deadlines required
required by
by the
the Franchise
Franchise Agreement.
the Owner/Operator
3.
Does the
the failure
failure to
to meet
meet any
any one
one of
ofthe
thefinancial
financial viability
viability measurements
(equity
Does
measurements (equity
percentage, cash
cash flow
flow coverage
coverage ratio
ratio and
and liability
liability turnover)
Owner/Operator
percentage,
turnover) mean
mean the
the Owner/Operator
fails to meet
meet the
theFinancial
Financial Standard?
Standard?
An
overall
point
system
is
now
applied to the
the individual
individual viability
viability measurements
An overall
is now applied
measurements in
determining
the
financial
viability
of
the
restaurant
business.
An
organization must
determining the financial viability of the restaurant business. An organization
must achieve
achieve
an overall
financial viability
Please refer
refer to
an
overall score
score of
of 6
6 or
or greater
greater to
to meet
meet the
the financial
viabilitymeasurement.
measurement. Please
to
the National
National Franchising
Franchising Standards
The
the
Standardsto
tosee
see aa breakdown
breakdownof
ofthe
the overall
overall point
point system.
system. The
financial statements
are reviewed
reviewed for
for accuracy
accuracy at
As with
with
financial
statements are
atthe
the time
time of
of the
the business
business review.
review. As
all of
Standards, the
Region will
and evaluation
all
of the
the Standards,
the Region
will use
use their
theirjudgment
judgment in
inthe
the assessment
assessment and
evaluation of
of
the measurements
measurements and
and guidelines.
guidelines.
the
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4.
Do II meet
Financial Standard
6 or
Do
meet the
the Financial
Standard ififmy
myorganization
organizationachieves
achieves an
an overall
overall score
score of
of 6
or
greater?
greater?
The point
point system
system isis used
used to
todetermine
determinefinancial
financialviability
viability only.
only. The
TheFinancial
Financial Standard
Standard criteria
criteria
The
also require
require that
an organization
and pay
pay
also
that an
organization submit
submit accurate
accurate financial
financialstatements
statements timely
timely and
McDonald’s and
McDonald's
andothers
otherson
ontime.
time. Also,
Also, ififdebt
debton
onthe
thefinancial
financialstatements
statements does
does not
not meet
meet
McDonald’s borrowing
McDonald's
borrowingstandards,
standards,the
the Region
Regionwill
willrestate
restatethe
the debt
debt terms,
terms, which
which may
may affect
affect
overall score.
the overall
5.
If my
McDonald’s borrowing
borrowing
If
my organization’s
organization's financing
financing arrangements
arrangements fall
fall outside
outside of
of McDonald's
standards, how is
is this
standards,
this treated?
treated?
In determining
In
determining the
the financial
financial viability
viabilityof
ofan
anorganization,
organization,the
the Region
Regionwill
willrestate
restate any
any debt
debt that
that
falls outside
of McDonald's
McDonald’s borrowing
borrowing standards.
standards.
falls
outside of
6.
How does
a non-operating
non-operating and/or
and/or non-recurring
non-recurring event
affect my
my financial
financial ratios?
How
does a
event affect
ratios?
All business
be recorded
recorded in
in accordance
accordance with
with GAAP
GAAP and
All
business transactions
transactions should
should be
and reflected
reflected on
on the
the
financial
statements
appropriately.
Any
transactions
or
non-recurring
events
will
be
financial statements appropriately. Any transactions or non-recurring events will be
evaluated by
by the
Region as
part of
transaction
evaluated
the Region
as part
of the
the financial
financial viability
viabilityassessment
assessment where
where the
the transaction
alters the
overall financial
For example,
in situations
such as
as aa
alters
the overall
financial condition
condition of
of the
the organization.
organization. For
example, in
situations such
sale of
of restaurant(s)
restaurant(s) where
business and
and
sale
where aa significant
significant amount
amount of
of cash
cash may
may come
come into
into the
the business
then be
be subsequently
subsequently drawn
drawn out,
out, the
the draw
draw may
may be
be excluded
excluded from
from the
the ratio
ratio calculations
calculations for
for
then
purposes of
of reviewing
reviewing financial
financial viability.
viability.
purposes
7.
7.
Do II get
ratio, if
if II have
Do
get the
the maximum
maximum 44 points,
points, under
under the
the cash
cash flow
flow coverage
coverage ratio,
have no
no debt
debt
regardless of
my net
cash flow
is?
regardless
of what
what my
net cash
flow is?
No. Owner/Operators
Owner/Operators who
have no
no debt
debt service
service can
can only
level points
points
No.
who have
only achieve
achieve the
the highest
highest level
when positive
positive net
netcash
cashflow
flowisismaintained
maintainedafter
afterG&A
G&A and
and Draw.
Draw.
when
8.
How is
calculated?
is equity
equity percentage calculated?
Value
of
the
Business
minus
Debt on
Business divided
divided by
Business
Value of the Business minus Net
Net Debt
on the
the Business
by the
the Value
Value of
of the
the Business
(Value of
of Business)
Business) —
— (Net
(Value
(Net Debt)
Debt) == Equity
Equity Percentage
Percentage
(Value of Business)
Business)
(Value
•
Value of the Business:
Business:
Value
Cash Flow
Debt Service,
Service, G&A
G&A and
Cash
Flow before
before Debt
and Draw
Draw less
less standard
standard G&A
G&A($35,000
($35,000 for
for
traditional restaurants
restaurants and
for satellites)
satellites) multiplied
multiplied by
by Cash
Cash Flow
Flow multiple
multiple
traditional
and $io,ooo
$10,000 for
of 4.5.
4.5. If
If the
equity percentage
percentage isis calculated
calculated to
to be
be less
lessthan
than25%
25% using
using this
this formula,
formula,
of
the equity
then the
the financial
financial director
director will
(with actual
actual
then
will use
use aa discounted
discounted cash
cash flow
flow method
method (with
reinvestment) to determine
determine the
the value
value of
of the business.
business.
reinvestment)
•
Debt on the Business
Business (Net
(Net Debt):
Debt):
Debt
Total Current
Total
Current Liabilities
Liabilitiesplus
plustotal
total Long-Term
Long-TermLiabilities
Liabilitiesminus
minusany
anyNotes
Notes Payable
Payable to
to
Stockholders minus
minus Current
Current Assets.
Stockholders
Both debt
and cash
cash flow
flow will
will be
be appropriately
appropriately adjusted
adjusted for
for all
all NEP
NEP restaurants.
Both
debt and
restaurants.
Howisis'TTM
ITM liability
9. How
liability turnover
turnover calculated?
The liability
liability turnover
It represents
represents TTM
TTM Average
or
The
turnover isis calculated
calculated over
over aa TTM
TTMperiod.
period. It
Average Positive
Positive or
Negative Working
Working Capital
Capital divided
by Average Daily
Daily Sales
Negative
divided by
5
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(Positive or
or Negative
NegativeWorking
Working Capital)
Capital) ==Liability
Liability Turnover
Turnover Ratio
Ratio
(Positive
(Average Daily
Daily Sales)
(Average
•
Working Capital
Working
Capital equals:
equals:
Current Assets less
less Current
Current Liabilities
Uabilities
Current
•
Current Liabilities
Liabilities equals:
Current
equals:
Total Current
Current Liabilities
Liabilities
Total
Minus: Current
CurrentPortion
PortionofofLong-Term
Long-Term Debt
Debt
Minus:
Plus:
1/12 of
ofCurrent
Current Portion
Portion of
of Long-Term
Long-Term Debt
Plus:
1/12
Debt
•
Average Daily
Daily Sales
Average
Sales equals:
Total Annualized
Total
Annualized Sales
Sales divided
divided by
by 363
363
•
Under the
point system,
system, points
points are
are assigned
assigned for
for aa positive
positive or
or negative
negativeLiability
Liability
Under
the point
Turnover. Negative
NegativeLiability
Liability Turnover
Turnover is
if Working
Working Capital
Turnover.
is calculated
calculated if
Capitalisisaa negative
negative
amount (i.e.,
(I.e., current
current liabilities
liabilities exceed
current assets).
assets). Positive
PositiveLiability
Liability Turnover
Turnover is
Is
amount
exceed current
calculated if
if Working
current
calculated
WorkingCapital
Capitalisisa apositive
positiveamount
amount(i.e.,
(i.e.,current
currentassets
assets exceed
exceed current
liabilities).
10. How
ratio calculated?
10.
How is cash
cash flow
flow coverage
coverage ratio
calculated?
Cash
Flow
after
G&A
and
Draw
actual G&A
G&A Isis used
in
Cash Flow after G&A and Draw divided
divided by
by Annual
Annual Debt
Debt Service
Service (note:
(note: actual
used in
calculation)
this calculation)
(Cash Flow
Flow after
G&A and
= Cash
Cash Flow
Ratio
(Cash
after G&A
and Draw)
Draw) =
Flow Coverage
Coverage Ratio
(Annual Debt Service)
Service)
(Annual
11. Does
Does the
the Financial
Financial Standard
11.
Standard require
requireaaminimum
minimumamount
amountof
ofcash
cash be
be kept
kept In
inthe
the business?
business?
No. Overall
Overall financial
financial viability
viability as
Financial Standard
No.
as part
part of
of the
the Financial
Standardmust
must be
be met.
met.
People
1.
1.
What does
does "having
“having an
number of
of shift-certified
shift-certified or
or shift
shift verified
verified managers"
managers”
What
an adequate
adequate number
mean?
mean?
An adequate
number of
of shift-certified
shift-certified managers
managers is
number required
required so
shift is
is
An
adequate number
is the
the number
so that
that each
each shift
run by
run
by aa shift-certified
shift-certified manager
manager and
and will
will vary
varybased
based on
on hours
hours of
of operation.
operation.
2.
What is
is required
required for
to be
be Shift
Shift Certified
Certified with
BSM being
What
for an
an employee
employee to
with BSM
being phased
phased out
out with
with
the transition
transition to
to Restaurant
Restaurant Department
Department Management
Management (RDM)
(RDM) classes?
the
classes?
A Shift
be Shift
Shift Verified
A
Shift Certified
Certified Manéger
Manager must
must be
be Serve
Serve Safe
Safe certified,
certified, be
Verified in
in the
the restaurant
restaurant
and have
have successfully
successfully completed
completed Introduction
Introduction to
to Management
Management(ITM)
(ITM) or
previous
and
or the
the previous
equivalent(i.e.,
(i.e.,BOC,
BOC, BSM).
BSM).
equivalent
3.
If an
has aa shift
Introduction to
if
an Owner/Operator
Owner/Operator has
shift manager
manager that
that is
is ready
ready and
and able
able to
to attend
attend Introduction
to
Management (ITM),
(ITM), but
or aa class
has
Management
but the
the manager
manager is
is waiting
waiting on
on class
class availability
availability to
to open
open or
class has
been cancelled,
cancelled, will
will this
this be
be held
held against
against the
Owner/Operator?
been
the Owner/Operator?
No.
McDonald’s
acknowledges
that
it
may
take
time to
to schedule
schedule shift
shift running
running
No. McDonald's acknowledges that it may take some
some time
managers
to
ITM
class.
Any
Owner/Operators
in
this
situation
should
work
with
managers to ITM class. Any Owner/Operators in this situation should work with their
their
Region to
plan to
get their
their shift
shift running
running managers
managers certified
certified as
as soon
soon as
as isis practical.
practical.
Region
to develop
develop aa plan
to get
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4.
Are satellites
required to
tohave
haveHU/ROLP/GM
HU/ROLP/GM Capstone
Are
satellites required
Capstone trained
trained managers?
managers?
No, typically
restaurants are
are not
notrequired
required to
tohave
haveHU/ROLP/GM
HU/ROLP/GM Capstone
No,
typically satellite
satellite restaurants
Capstone trained
trained
managers. However,
However, the
thesatellite
satelliterestaurant's
restaurant’sfranchising
franchising documents
documents may
may require
require an
an
managers.
HU/ROLPfGM Capstone
HU/ROLP/GM
Capstonetrained
trained manager.
manager.
5.
An Owner/Operator
The survey
survey
An
Owner/Operator organization
organizationconducts
conductsan
anemployee
employee commitment
commitment survey.
survey. The
scores
are
much
lower
than
the
Owner/Operator
would
like.
As
a
result
the
organization
scores are much lower than the Owner/Operator would like. As a result, the organization
creates and
and implements
implements an
an action
Will the
creates
action plan
plan to
to address
address the
the deficiencies.
deficiencies. Will
the low
low
commitment score
score cause
cause this
this organization
organization to
meet the
the People
People Standard?
Standard?
commitment
to not
not meet
No. This
No.
This Standard
Standard requires
requiresconducting
conductingthe
the survey
surveyand
and reviewing
reviewingthe
the feedback.
feedback.
6.
Does the
the Owner/Operator
Owner/Operator have
have to
touse
usethe
theMcDonald's
McDonald’s approved
approved Manager
Manager and
and Crew
Crew
Does
Commitment Survey?
Survey?
Commitment
No. However,
However, the
the Owner/Operator
Owner/Operator must
must have
employee feedback
feedback process
process in
in
No.
have an
an effective
effective employee
place. As
As part
part of
of this
this process,
process, the
the Owner/Operator
Owner/Operator must
must gather
gather and
and review
review anonymous
place.
anonymous
feedback from
from the
the management
management and
and crew
crew at
at each
each restaurant
restaurant at
at least
least annually.
annually.
feedback
7.
Can you
provide more
more details
details on
on our
our People
People Migration
Migration Strategy?
Can
you please
please provide
Strategy?
The
People
Migration
Strategy
is
a
three-tiered
approach
inàludingBHOT'r,
BHOT’r, Shift
Shift
The People Migration Strategy is a three-tiered approach including
Management
Excellence
and
Restaurant
Department
Management.
Consistent
Management Excellence and Restaurant Department Management. Consistent use
use of
of the
the
migration tactics
supports crew
benefits, hiring,
hiring, orientation,
training and
with
migration
tactics supports
crew benefits,
orientation, training
and retention
retention with
extended focus
focus on
onShift
Shift Managers
Managers with
with Shift
Shift Management
Excellence. Restaurant
Restaurant
extended
Management Excellence.
Department Management
of the
strategy with
with aa management
management
Department
Management serves
serves as
as the
the capstone
capstone of
the strategy
structure, curriculum
helps
structure,
curriculumand
andmanagement
managementsupport
supporttools.
tools. Consistent
Consistent use
use of
of these
these tactics
tactics helps
to provide
provide aa foundation
foundation of
of highly
highly skilled
to
skilled and
and motivated
motivated restaurant
restaurant employees.
employees.
8.
What are
examples of
of McDonald's
McDonald’s training/meetings
a
What
are some
some examples
training/meetings that
that would
would demonstrate
demonstrate a
General Manager
General
Manager has
has remained
remained current
current with
with restaurant
restaurant operations
operations each
each year?
year?
Some examples
examples include,
include, but
but are
arenot
notlimited
limited to,
to,participation
participation at
atRegional,
Regional, Division
Division and
and
Some
National meetings
such as
as Seed
Seed Stores,
Stores,Plan-to-Win
Plan-to-Win Road
Road Shows,
Shows, Manager
Manager Rallies,
Rallies,
National
meetings such
Operations Summits,
Summits, COMR.,
COMR., Business
Is Important
Important that
that General
General
Operations
BusinessAlignment
Alignmentmeetings,
meetings, etc.
etc. ItIt is
Managers stay
of our
our
Managers
stay current
current with
with restaurant
restaurantoperations
operationsbecause
because the
the continued
continued success
success of
System
is
founded
on
having
highly
skilled
and
motivated
restaurant
employees.
The
System is founded on having highly skilled and motivated restaurant employees. The
ongoing training
of our
our General
General Managers
Managers is
retaining
ongoing
training and
and development
development of
is essential
essential to
to retaining
qualified personnel
to operate
operate and
and build
build the
the McDonald's
McDonald’s business.
qualified
personnel to
business.
9.
How will
10 hours
hours of
of continuing
continuing education
education for
for General
General Managers
Managers be
be tracked?
tracked?
How
will the
the 10
The Owner/Operator
will have
have the
responsibility and
and flexibility
flexibility to
10 hours
hours of
The
Owner/Operator will
the responsibility
to track
track the
the 10
of
continuing education
for their
their General
General Managers
Managers in
for their
continuing
education for
in aa manner
manner best
best suited
suited for
their
organization.
Building
Buildingthe
the Business
Business through Guest Satisfaction
1. What
Whatdoes
doesitItmean
meantotohave
haveall
allshifts
shiftsadequately
adequatelystaffed
staffed with
with trained
trained crew
crew and
and
1.
management to maximize
maximize sales?
Adequately staffed
for aa shift
Adequately
staffed for
shift means
means having
having enough
enoughtrained
trainedemployees
employees on
on the
the floor
floor to
to meet
meet
the
projected
sales
and
satisfy
guests.
Restaurants
that
have
shifts
adequately
staffed
the projected sales and satisfy guests. Restaurants that have shifts adequately staffed to
to
7
7
HIGHLY CONFIDENTIAL
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MCDOCHOO7534
MCDOCH007534
Case 3:14-cv-02098-JD Document 271-11 Filed 08/17/15 Page 27 of 28
MCDOCHOO752B .
MCDOCH007528
maximize sales
the guest
guest expectations,
expectations, respond
respond quickly
quickly to
any
maximize
sales are
are able
able to
to meet
meet or
or exceed
exceed the
to any
guest concerns,
concerns, and
and maximize
maximize sales
potential.
guest
sales potential.
an Owner/Operator showing support for System
2. What are
are some
some examples of an
System promotions,
recommendations and initiatives?
System promotions,
promotions, recommendations
and initiatives
initiatives should
supported in
in
System
recommendations and
should be
be consistently
consistently supported
each
restaurant
of
an
Owner/Operator
organization.
We
work
collaboratively
together
with
each restaurant of an Owner/Operator organization. We work collaboratively together with
Owner/Operators to
ensure our
our Plan
Plan to
Win isis designed
business forward.
forward.
Owner/Operators
to ensure
to Win
designed to
to drive
drive the
the business
Examples include,
activities,
Examples
include, but
but are
arenot
not limited
limitedto,
to, new
new product
product launches,
launches, promotional
promotional activities,
extended hours
hours of
of operation
operation and
and value
value offerings.
offerings. Any
Any concerns
concerns an
an Owner/Operator
Owner/Operator may
may
extended
have regarding
regarding the
or initiative
initiative (such
(such as
have
the support
support of
of aa System
System promotion,
promotion, recommendation
recommendation or
as
extended hours)
hours) for
for aa specific
specific restaurant
restaurant of
Owner/Operator organization
extended
of the
the Owner/Operator
organization should
should be
be
discussed with
with the
theQSC
QSC VP
VP or
or Field
Field ServJce
discussed
Service Team.
3. Are “special
3.
"special venue”
venue" restaurants
restaurants required
required to
to participate
participate in
in all
allSystem
System promotions?
promotions?
No, there
will be
situations when
when the
the OPNAD
OPNAD and
No,
there will
be situations
and Cc-Op
Co-Opendorsed
endorsedpromotions
promotions cannot
cannot be
be
implemented. Before
Before aa new
newpromotion
promotion isis rolled
rolled out,
out, the
the Owner/Operator
Owner/Operator and
and the
the Region
Region
implemented.
should discuss
should
discuss whether
whether there
there are
are circumstances
circumstances that
thatwould
would prevent
preventthe
the owner/operator
owner/operator
from
selling
certain
products
or
participating
in
certain
promotions
at
from selling certain products or participating in certain promotions atthese
these locations.
locations.
4. How will
this Standard?
Standard?
4.
will mystery
mystery shop
shop results
results be
be used when assessing this
Mystery Shop
tool in
in this
this Standard
Standard and
an
Mystery
Shop scores
scores are
are not
not aa measurement
measurement tool
and will
will not
not cause
cause an
Owner/Operator organization
However, the
results will
Owner/Operator
organizationto
to fail
failto
to meet
meet this
this Standard.
Standard. However,
the results
will be
be
discussed as
as they
they provide
provide an
an additional
additional source
discussed
source of
of information
information and
and can
can help
helpto
to develop
develop
insightful commentary
Mystery Shop
insightful
commentary within
withinOwner/Operator
Owner/Operatorbusiness
businessreviews.
reviews. See
See Mystery
Shop memo
memo
issued October
October 3,
2011 for
for further
further details.
(Marion wants
or list
list key
points
issued
3, 2011
details. (Marion
wants to
to attach
attach memo
memo or
key points
or leave
leave it
it off-she doesn't
doesn’t think
think they
or
they can
can find
find the
the memo)
5.
5. How will
assessing this
this Standard?
will the
the number
number of
of guest
guest complaints
complaints be used when assessing
The number
complaints is
is no
no longer
longer used
used as
as aa measurement
measurement in
in this
this Standard
Standard and
and
The
number of
of guest
guest complaints
will not
an Owner/Operator
Owner/Operator to
this Standard.
Standard. Rather,
Rather, the
organization
will
not cause
cause an
to fail
fail to
to meet
meet this
the organization
should focus
on call
call back
See Customer
Customer Complaint
Complaint memo
August 30,
should
focus on
back responsiveness.
responsiveness. See
memo dated
dated August
30,
2011 for further details.
6. Does the "All
“All shifts
6.
shiftsadequately
adequately staffed
staffed to maximize
maximize sales”
sales" guideline
guideline contained
contained In
in the
the
Building the
Building
the Business
Business through
through Guest
Guest Satisfaction
Satisfaction Standard
Standard requires
requires aa restaurant
restaurant to
to adopt
extended hours?
No. The
The reference
reference in
in this
this guideline
guideline to
to "maximizing
“maximizing sales”
staffing
No.
sales" refers
refers to
to adequately
adequately staffing
existing shifts.
24 hours
hours or
or extended
hours and
implement them
should be
be aa
existing
shifts. 24
extended hours
and the
the decision
decision to
to implement
them should
discussion between
the Owner/Operator
Owner/Operator and
and the
the Region.
Region.
discussion
between the
maximize sales "by
“by providing
7. What does it mean to maximize
providingreliable,
reliable,competitive
competitive value
value to
to the
the
guest”?
guest"?
Our guests
a menu
menu that
that offers
offers compelling
compelling value
value every
every time
time they
they visit
visit aa McDonald's
McDonald’s
Our
guests expect
expect a
restaurant Accordingly,
Accordingly, in
in order
remain competitive
restaurant.
order to
to remain
competitive and
and relevant
relevant to
to our
our guests,
guests,
McDonald’s restaurants
McDonald's
restaurants must
must offer
offer aa value
value platform
platformwhich
whichisisconsistent
consistentwith
withthese
these
expectations.
Reliable,
competitive
value
will
evolve
over
time
and
vary
from market
market to
expectations. Reliable, competitive value will evolve over time and vary from
to
market.
8
HIGHLY CONFIDENTIAL
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MCDOCHL~)7528
IVICDOCHC37528
complaint.
800#with
the 800#
called the
that called
guestthat
reach aa guest
toreach
unableto
Owner/Operatorisisunable
TheOwner/Operator
8. The
8.
with aa complaint.
through
Business
the
Building
the
meets
Owner/Operator
the
whether
Will this
Will
this impact
impact whether the Owner/Operator meets the Building the Business through
Standard?
Satisfaction
Guest Satisfaction Standard?
Guest
If the
If
the Owner/Operator
Owner/Operatorhas
hasmade
madereasonable
reasonableattempts
attemptsto
to contact
contact the
the guest
guest and
and has
has aa guest
guest
place, failure
in place,
process in
recovery process
recovery
failure to
to reach
reach that
that guest
guest will
will not
not be
be held
held against
against the
the
Owner/Operator.
Owner/Operator.
Involvement
Owner/Ocerator Involvement
Owner/Operator
1.
1.
Company on
for an
Is itit acceptable
Is
acceptable for
an Owner/Operator
Owner/Operator to
to disagree
disagree or
or challenge
challenge the
the Company
on issues
issues
and policies?
and
policies?
McDonald’s encourages
in aa professional
it is
as it
long as
Yes, as
Yes,
as long
is done
done in
professional and
and constructive
constructive manner.
manner. McDonald's
encourages
System.
interest
best
the
in
individual initiative
or individual
debate or
spirited debate
spirited
initiativethat
thatisisdone
done in the best interest of
of the
the System.
2.
2.
If an
OPNAD and
in OPNAD
Participation in
Participation
andthe
the Co-Op
Co-Opisisvoluntary
voluntaryunder
underthe
theFranchise
FranchiseAgreement.
Agreement. If
an
Owner/Operator
this
will
Co-Op.
local
the
or
OPNAD
of
member
a
not
Is
Owner/Operator is not a member of OPNAD or the local Co-Op, will this Owner/Operator
Owner/Operator
Standard?
Involvement Standard?
Owner/Operator Involvement
theOwner/Operator
meet the
meet
Franchising Standards
National Franchising
No. The National
No.
Standardsrequire
requirean
anOwner/Operator
Owner/Operatorto
tobe
beaamember
member of
of both
both
OPNAD
andthe
the appropriate
appropriate local
localCo-Op
Co-Opeven
eventhough
thoughthe
the Franchise
FranchiseAgreement
Agreementdoes
does not.
not.
OPNAD and
3.
3.
A
Owner/Operators remain
remain current
currentwith
withthe
the business
business has
has been
been added
added to
to
A requirement that Owner/Operators
will this
How will
Involvement Standard.
Owner/Operator Involvement
the
Standard. How
this be
be measured?
measured?
the Owner/Operator
through ongoing
business through
An
Owner/Operator must
must be
be aa student
student of
of the
the business
ongoing education.
education.
An Owner/Operator
following:
Remaining
currentwith
withthe
the business
business can
can be
be achieved
achieved by
by completing
completing one
one of
of the
the following:
Remaining current
OR
year. OR
each year.
Participating IninMcDonald’s
•
Participating
McDonald'smeetings,
meetings,conventions,
conventions, and
and events
events each
HU training
based HU
•
Attending an
an Owner/Operator based
training class
class within
withinthe
the past
past 10
10 years.
years.
OR
OR
years. OR
10 years.
past 10
GM capstone
•
Attending the GM
Capstone class
class within
within the
the past
Participating on
•
Participating
onaaMcDonald’s
McDonald'ssystem
systemteam
team within
withinthe
the past
past 18
18 months
months
RLC, OPNAD,
DLC,RLC,
NLC,DLC,
limitedto,to,
notlimited
arenot
butare
include, but
(Examples include,
NLC,
OPNAD, regional,
regional,
OR
teams) OR
sub teams)
or sub
teams or
divisional teams
teams, divisional
teams,
McDonald’s training
•
Sponsoring a McDonald's
trainingclass
classwithin
withinthe
the past
past 18
18 months.
months.
9
HIGHLY CONFIDENTIAL
HIGHLY
MCDOCHOO7536
MCDOCH007536
Exhibit 7
Case 3:14-cv-02098-JD Document 270-12 Filed 08/17/15 Page 2 of 8
4
ICDOCHOO715O
1CDOCH007150
4CDOCH007150
Standards
Equipment Standards
and Equipment
Restaurant Building and
National Restaurant
Restaurants
Traditional Restaurants
for Traditional
2012
JANUARY 2012
establishes
Equipment Standards
and Equipment
Building and
Restaurants Building
National Restaurants
updated National
The most recently updated
Standards establishes
our
grow our
needs and
business needs
standards that
a set of consistent national standards
that reflect
reflect today’s
today's business
and helps
helps grow
experience.
restaurant experience.
outstanding restaurant
an outstanding
deliver an
able to deliver
being able
by being
business by
provided their
have provided
Management have
Owner/Operators and Division Management
Field, Owner/Operators
The Field,
their input
input in
in the
the
Business
and Business
Rewrites and
Relocations/Rebuilds, Rewrites
Sales, Relocations/Rebuilds,
Store Sales,
for Store
tool for
NRBES tool
of the NRBES
development of
tool.
NRBES tool.
the NRBES
of the
components of
key components
are key
execution are
consistent execution
and consistent
application and
Universal application
Reviews. Universal
VISION
identify aa
to identify
designed to
are designed
Standards are
Equipment Standards
Building and Equipment
Restaurant Building
National Restaurant
The National
be positioned
can be
restaurant can
ensure every
standards to ensure
consistent set of standards
every restaurant
positioned to
to deliver
deliver an
an
place
our customers’
be our
to be
vision to
our vision
support our
and support
experience and
exceptional restaurant experience
customers' favorite
favorite place
system,
operating
best-in-class
our
execute
to
ability
our
enable our ability to execute our best-in-class operating system,
NRBES enable
The NRBES
eat. The
and way to eat.
safety and
crew/customer safety
quality, crew/customer
and quality,
ensuring brand image, food safety and
and comfort.
comfort.
PURPOSE
applied. They
uniformly applied.
and uniformly
consistent and
understand, consistent
to understand,
easy to
be easy
intended to be
NRBES are intended
The NRBES
They are
are
on
discussions
time-wasting
eliminate
conflicts, eliminate time-wasting discussions on
reduce conflicts,
expectations, reduce
clarify expectations,
intended to clarify
also intended
same
experience the
customers’ experience
our customers'
help our
importantly, help
which standard applies and most importantly,
the same
McDonald’s.
visit to
outstanding QSC &V on every visit
to McDonald's.
APPLICATION
APPLICA11ON
measure an
means to
as aa means
Regions as
all Regions
in all
be used in
NRBES will be
past, the NRBES
As in the past,
to measure
an existing
existing
needed. To
as
Rewrites
and
Rebuilds
Relocations,
Sales,
Store
of
purposes
for
restaurant
purposes
Relocations, Rebuilds and Rewrites as needed.
To
be
will be
NRBES will
to the
additions to
no additions
regions, no
all regions,
in all
NRBES in
the NRBES
of the
application of
ensure consistent application
the NRBES
Review
Business
the
in
used
be
will be used in the Business Review
also will
NRBES also
The NRBES
level. The
divisional level.
and divisional
allowed on a regional and
meet
to meet
take to
to take
needs to
restaurant needs
the restaurant
steps the
sense steps
common sense
discussion of common
process to encourage discussion
a
from
plans
reinvestment
long-term
develop
surprise,
remove
to
is
goal
The
standards.
the
is remove surprise, develop long-term reinvestment plans from a
McDonald’s
delivering the
are delivering
restaurants are
our restaurants
all our
that all
business perspective, and insure that
the optimum
optimum McDonald's
customers.
experience to our customers.
their
contact their
can contact
NRBES can
of NRBES
application of
the application
regarding the
have questions regarding
Owner/operators
Owner/operators who have
representative.
REAL team representative.
AJ(EXHIBIT
~RptL~
w~wDEpoDOOLcOM
CONFIDENTIAL
HIGHLY CONFIDENTIAL
1
O
MCDOCHOO7I5
MCDOCH007150
Case 3:14-cv-02098-JD Document 270-12 Filed 08/17/15 Page 3 of 8
MCOOCHOO7I5O
MCDOCH007150
National Restaurant Building
Building and Equipment Standards
National
Restaurants
for Traditional Restaurants
REVIEW PROCESS
NRBES REVIEW
PROCESS
For your reference, please
please find below an overview
overview of the review process the team followed to
in January 2012. The overall process
process was
develop the revisions that will become effective in.January
close~collaboration with the NLC
NLC NRBES Review
Review Team.
Team.
managed by U.S. Operations in close.collaboration
solicited
• In October 2010, the tools were open for review and the U.S. Operations team solicited
feedback from regional, divisional and home office staff.
NLC NRBES
NRBES Review
Review Team
Team members
members were
were identified
identified in
in January
January2011
(see list
list below).
below).
• The
The NLC
2011 (see
• The NLC
NLC NRBES Review
Review Team held
held an initial phone
phone call in March 2011
2011 to review the
process and
feedback.
process
and solicit feedback.
input.
• We also reached out to various NLC teams to solicit their input.
Review Team met
met face to face in
in April and June to discuss the proposed
• The NLC NRBES Review
changes. The meetings were followed by
by a conference
conference call
call during which the team reached a
changes.
final agreement on proposed revisions.
revisions.
final
22.
• The proposed revisions were presented to the full NLC body on August 22.
NLC NRBES Review
Review Team called for a vote to endorse the revisions during the
• The NLC
NLC Conference
Conference Call.
Call. On
On September
September 26, the NLC
NLC endorsed the proposed
September 26 NLC
revisions.
revisions.
REVIEW PROCESS
NRBES REVIEW
PROCESS
process for reviewing the NRBES
NRBES tools involves
involves aa team of Home
Home Office, Field
Field and NLC
The process
representatives. The NLC
NLC NRBES
NRGES Review Team representatives included:
included:
representatives.
•
•
•
•
•
•
••
Co-lead: Kevin
Co-lead:
Kevin Hem
Kramer, WON
Conny Kramer,
WON Chair
Ebrahim Magflsoud
Ebrahim
Maghsoud , AMOA
AMOA Chair
Roland Parrish,
Parrish, NBMOA Chair
Lopez, MHOA Chair
Leo Lopez,
Divisions DLC Chair: Mark Salebra (East
(East Division),
Division), John Valuzzo (Central Division),
Division), Jo
Divisions
Division)
Crenshaw (West Division)
of the NLC:
NLC: Lee
Lee Heriaud,
Heriaud, Susan
Susan Singleton,
Singleton, Luis
Luis Hernandez,
Hernandez, Sandy Phillips
Elected Officers of
,
2
CONFIDENTIAL
HIGHLY CONFIDENTIAL
MCDOCHOO7I5I
MCDOCH007151
MCDOCHOO7I5O
MCDOCH0071
50
Case 3:14-cv-02098-JD Document 270-12 Filed 08/17/15 Page 4 of 8
EquIpment Standards
Restaurant Building and Equipment
National Restaurant
Restaurants
for Traditional Restaurants
QUESTIONS
FREQUENTLY ASKED QUESTIONS
General Questions
Standards?
Equipment Standards?
Building and
Restaurant Building
What is the purpose of the National Restaurant
and Equipment
exceptional
an exceptional
deliver an
can deliver
restaurant can
McDonald’s restaurant
every McDonald's
NRBES are designed to ensure every
• The NRBES
food
image, food
brand image,
McDonald’s brand
support McDonald's
help~ support
They help
customers. They
experience for our customers.
restaurant experience
profitability,
restaurant
accessibility,
comfort, accessibility, restaurant profitability,
and comfort,
safety and quality, crew/customer
crew/custorner safety and
regulations.
local regulations.
and ensure compliance with federal, state and local
has the
restaurant has
McDonald’s restaurant
if aa McDonald's
• The standards can also be used to help determine if
the
to:
resources to:
necessary equipment and physical plant resources
system
o Support the current operating system
o
Execute the menu
o Execute
o Serve safe/quality products
o
o Provide an exceptional restaurant experience
o
environment
profitable environment
o Enable the business to grow in a safe and profitable
a
as a
Regions as
all Regions
in all
used in
be used
to be
standards to
consistent standards
NRBES tool provides for nationally consistent
• The NRBES
experience.
McDonald’s
exceptional
an
deliver
to
restaurant’s ability to
means to measure a restaurant's
an exceptional McDonald's experience.
between
dialogue between
meaningful dialogue
promote meaningful
to promote
NRBES become a vehicle to
that the NRBES
is that
intent is
• The intent
owner/operator.
McDonald’s and the owner/operator.
McDonald's
used?
be used?
Standards tool
Equipment Standards
and Equipment
Restaurant Building and
National Restaurant
When should the National
tool be
restaurant
of
purpose
för,the
restaurants
existing
means to measure
used as a means
is used
NRBES is
The NRBES
restaurants for the purpose of restaurant
plans.
reinvestment plans.
restaurant reinvestment
rebuilds, rewrites and for developing restaurant
sales, relocations, rebuilds,
owner/operator and
the owner/operator
by the
completed by
be completed
will be
tool will
NRBES tool
Review, the NRBES
Business Review,
of the Business
As a part of
and
discuss aa
to
dialogue
meaningful
create meaningful dialogue to discuss
to create
creates the opportunity to
This creates
Field Service. This
identify
help identify
to help
and to
business, and
the business,
grow the
and grow
best to serve the customer and
how best
plan, how
reinvestment plan,
reinvestment
items.
reinvestment items.
restaurant reinvestment
have” restaurant
to have"
“nice to
haven versus the "nice
“need to have"
and prioritize the "need
new?
Standards new?
National Restaurant Building and Equipment Standards
Are the National
Report and
Force
Task
“Dentise
the
of
part
as
1989
in
created
No. This tool was
1989
"Dentise Task Force Report
and McDonald’s
McDonald's
owner/operator
the owner/operator
from the
representatives from
of representatives
consisting of
team consisting
1999, aa team
In 1999,
Package”. In
Economic Package".
Americans
the Americans
reflect the
to reflect
NRBES to
the NRBES
updated the
Home Office updated
and Home
regions, divisions and
community, regions,
system.
operating system.
You operating
for You
Made for
implementation of the Made
Disabilities Act and the implementation
with Disabilities
feedback
the feedback
reflect the
to reflect
2011 to
and 2011
2007 and
modified in 2001, 2003, 2005, 2007
further modified
NRBES was further
The NRBES
divisions/field.
the divisions/field.
and the
Leadership Team, owner/operators and
U.S. Leadership
from the U.S.
tool be updated?
often will the NRBES tool
How often
our
with our
evolve with
to evolve
continue to
and will
2012 and
of 2012
as of
needs as
NRBES reflect our business needs
The current NRBES
will continue
consisting
team
a team
by a
needed by
as needed
NRBES tool will be reviewed /updated as
business. The NRBES
team consisting
consisting of
of
System-wide
representatives. System-wide
Office representatives.
Home Office
and Home
division, region and
owner/operators as well as division,
occur.
changes will be incorporated as they occur.
standards?
McDonald’s ensure compliance with the standards?
How does McDonald's
standards through
McDonald’s standards
required to meet McDonald's
All owner/operators are required
through their
their franchise
franchise
agreement.
agreement.
3
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MCOOCHOO?1 50
MCDOCH0071
How will Operations and
and Construction
Construction be trained on
o~ the NRBES and in applying the
How
standards?
NRBES is to provide
provide a consistent set of national
national standards.
The overall intent of the NRBES
standards. The regions
and divisions are !2≤≥~
not allowed to make additions to the standards.
Improved communications and education about the vision,
vision, purpose,
purpose, and application
application of the
standards include:
ROIP training at HU.
HU.
• NRBES is addressed in ROIP
into the Business Review.
Review.
• NRBES is incorporated into
FAQ’s will be posted on AccessMCD.
• NRBES and the FAQ's
Is there an appeal process for the NRBES?
You can
can work through the region and McDonald's
McDonald’s internal dispute resolution process.
process. If you
regarding the application, please contact your REAL team representative.
representative.
have any questions regarding
communicating NRBES?
Who is responsible for communicating
The NRBES will be communicated to the field through a cascade approach beginning with the
VP’s, McOpCo VP's
VP’S and GM's.
GM’s.
QSC VP's,
versus aa store sale?
Are the NRBES different for a rewrite versus
No, the same standards apply.
reviewed for a restaurant?
restaurant?
How often are NRBES reviewed
•
•
•
•
Business Review
Review process,
process,
Prior to the Business
years prior
prior to the expiration of the franchise term for the rewrite review,
review,
approximately three years
Rebuilds and Relocations,
Relocations, and
at time of Store Sale, Rebuilds
at any other appropriate time.
a question
question on NRBES?
Who do II contact if II have a
•
•
•
•
management.
Your first point of contact should be your regional management.
U.S. Operations
U.S.
Your REAL team representative
representative
Your regional NLC representative
If one or more of my restaurants
restaurants is not in compliance with NRBES, does this affect my
eligibility for growth and rewrite
rewrite consideration?
consideration?
agreed upon
It may, depending on the circumstance. Typically if an owner/operator has an agreed
restaurant into compliance, they will be deemed to meet this
reinvestment plan to bring the restaurant
national franchising standard. Of course, if the owner/operator does not live up to the plan
plan or if
meeting the National
the non-compliance is severe, then the owner/operator would not be meeting
be ineligible
ineligible for rewrite and growth.
growth.
Franchising Standard and would be
What bearing or consequence does non-compliance with the NRBES have on
on an
ownerloperator entity for a store sale?
owner/operator
McDonald’s will require
require the restaurant
restaurant to be
be brought
brought up to standards within 6 months after the
McDonald's
may impact the purchase price if a restaurant is in nonnon
purchase of the restaurant. This may
compliance.
4
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MCDOCH007153
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MCDOCHQO7I5O
MCDOCH007150
If there is
is aa “required
bydate"
date” fora
for astandard,
standard,what
whatdoes
doesthat
that mean
mean to
to aa restaurant
restaurant up for
required by
rewrite or sale that has not yet met that standard?
understand
• NRBES will be communicated by regional management. Any owner/operator should understand
whether they have a restaurant condition that may not be in compliance in the future.
• If the rewrite or store sale is prior to the "required
‘required by date,"
date,” the restaurant is considered to
standard. However any potential buyer should and will factor the cost
be meeting the current standard.
of, and time frame required to bring the restaurant up to standards in the purchase price.
price.
“required by date,”
the
restaurant
is
considered
• If the rewrite or store sale is after the "required
date,"
considered out of
standards.
compliance with that standard and will be required to meet standards.
Are traditional restaurants and SPODs reviewed the same for compliance?
SPOD’s are special sites that may not need to have the same physical plant and
• No, SPOD's
deliver an excellent QSC experience to our customers.
customers.
equipment package requirement to deliver
McDonald’s in Walmart was developed in
in 2004 and revised in
• A NRBES tool specific to McDonald's
McDonald’s in
2008. It is scheduled to be reviewed in 2012.
2012. The NRBES document for McDonald's
Walmart is located on AccessMCD.
AccessMCD.
Are NRBES being
beinq used as a backdoor approach to changing the franchise agreement?
maintain and
The franchise agreement is clear in that it is the owner/operator’s
owner/operator's obligation to maintain
McDonald’s standards.
standards.
keep the restaurant up to McDonald's
understand, have owner/operator and field acceptance,
acceptance, and
The NRBES are intended to be easy to understand,
satisfy McDonald's
McDonald’s legal and franchising concerns. They are also
also intended
intended to clarify
clarify expectations,
and, most
reduce conflicts, eliminate time-wasting discussions on which standards apply and,
importantly, help our customer experience. The NRBES
NRBES does not
not change
change the franchise agreement.
agreement.
importantly,
Act (ADA)
(ADA)
Questions about Americans with Disabilities Act
Why is the ADA included in
in McDonald's
McDonald’s NRBES?
McDonald’s restaurants,
restaurants, are required by law to comply with the
All public facilities, including McDonald's
Disabilities Act. Franchisees are required to comply with all laws applicable to
Americans with Disabilities
restaurants, including the ADA.
their restaurants,
McDonald’s have
have any ADA obligations
obligations on restaurants owned
owned and operated by a
Does McDonald's
franchisee?
franchisee?
The owner/operator is required, both by law and the Franchise Agreement, to comply with the
restaurants. If the owner/operator has an issue with
Americans With Disabilities Act for their restaurants.
regard to compliance and what that means to the owner/operator's
owner/operator’s restaurant,
restaurant, especially
especially with a
1991, then the owner/operator should contact their GM or QSC
QSC VP for
restaurant built after 1991,
clarification.
further clarification.
V
How do we know if we are in compliance with ADA?
compliance.
An owner/operator can perform an ADA Self Assessment Survey to assess compliance.
Alternatively, an owner/operator may choose to hire
hire an outside consultant or architect to
Alternatively,
can be located on AccessMCD on
complete an ADA survey. The ADA Self Assessment Survey can
the U.S. Restaurant Development website, under Construction and then ADA.
The direct link is:
https:I/www.accessmcd.com/accessmcd.html?frameTar~et=htt~s://~rod~. mcdexchancje.cam/mc
httos://wwvv.accessmcd.com/accessmcd.html?frameTaroet=httcs://crodo.mcdexchanoe.com/mc
donalds/us/natl/rest dev/Construction/ADA.html
dev/Construction/ADA.html
donalds/us/natl/rest
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M000CHOO7 150
MCDOCH007150
What does "readily
“readily achievable"
achievable” mean
fl~e ~n relative to ADA
ADAcomplian?
compliance?
achievable is
is defined
defined as those alterations that are not "too
“too difficult and
Readily achievable
and not too
expensive” to accomplish. The definition of "not
“not too difficult and not too expensive"
expensive” is the legal
expensive"
vary depending on the location,
location, condition and age of the restaurant,
restaurant, the
definition and can vary
financial resources of the owner/operator and whether the restaurant has been remodeled.
remodeled. Note
guidelines were revised and are effective on a limited basis with respect to
that in 2010 the ADA guidelines
and alterations
alterations commenced on or after September 15,
15, 2010 and before March
new construction and
15, 2012. On
On and after
after March
March 15,
15, 2012, all new construction and alterations must comply with
15,
Self Assessment Survey addresses the requirements of the 2010
the 2010 guidelines. The ADA Self
clarification, the owner/operator should contact their GM or QSC VP.
VP.
guidelines. For further clarification,
is not
not in
in ADA compliance,
compliance, do corrections need to be made immediately,
immediately, or
If a restaurant is
time?
can they take
take place
place over
overtime?
Legally, all restaurants must be in
in compliance
This involves
involves meeting the readily
compliance with
with ADA.
ADA. This
for those restaurants built before 1992 and being in full
achievable standard for
full cOmpliance
compliance for
restaurants built
built after
after 1991.
1991. New
New construction and alterations commenced on or after
those restaurants
15, 2012 must
must comply
comply with the 2010 ADA guidelines.
guidelines.
March 15,
is there aa central location
location where information
information related to ADA is available?
Is
is posted
posted on the U.S.
U.S. Restaurant Development website,
Information related to ADA is
website, under
Construction and then ADA. The direct link is:
https:/twww.accessmcd.com/accessmccj html?frameTar~et=https:llr,rodp. mcdexchan~e.com/mc
https://www.accessmcd.com/accessmcd.html?frameTarget=https://prodp.mcdexchande.com/mc
donalds/us/nati/rest dev/Construction/ADA.html
dev/Construction!ADA.html
donalds/us/natl/rest
.
Elements of NRBES
Questions About Specific Elements
IS a grill in
in compliance
compliance ifif itit has
has not
not received
received an Annual Grill Certification and PM
Is
12 months?
verification within the last 12
Any restaurant that has
has not had
had an Annual Grill Certification and PM Verification
Verification performed
last 12
12 months will be considered out of compliance.
compliance.
within the last
rapid toasters required
required on the NRBES
NRBES if only one rapid toaster is required
Why are two rapid
when utilizing a bun buffer?
bun is
is aa key
key component
component of
of the quality attribute of our sandwiches.
sandwiches. Due to the high
A toasted bun
high dependence on the rapid toaster,
toaster, a second rapid toaster is
volume of buns and the high
ensure an
an operational
operational toaster
toaster is
is available as back
back up to the unit that is on-line.
on-line. Two
required to ensure
rapid toasters provide the ability
ability to routinely
routinely switch out toasters to perform necessary
maintenance.
preventative maintenance.
Why is the receipt printer relocated to the cashier booth?
has been
been relocated for several reasons:
The receipt printer has
customer has
has a damaged
damaged Arch Card, he/she must provide the arch card activation
activation
• If a customer
card. Handing
Handing the
the receipt
receipt to
to the
the customer
customer along
along with the activated Arch
receipt to get a new card.
the receipt
receipt prints
prints in
in the
the present
present booth,
booth,
Card ensures the customer gets
gets the
the receipt.
receipt. When
Mien the
forget to
to hand
hand itit to
to the
the customer
customer and
and the
the receipts
receipts may
may be
be thrown
thrown away.
away. ,
crew often forget
customer comes back
back into
into the restaurant
restaurant to get the receipt, which causes
Oftentimes, the customer
time.
the manager to dig through the trash and this wastes time.
signature. It's
It’s cumbersome to tell
• Credit Card transactions of $25 or over require a signature.
“drive up to the next
next window to sign your receipt."
receipt.” If crew forget to get the
customers to "drive
signature, we are in breach
breach of
of our credit
credit card processor
processor agreement.
agreement. Signed receipts must be
signature,
cases.
saved for three to five years for disputed cases.
• Customers like to be given
given a receipt
receipt at the place
place where they handed
handed over their credit card
correct.
for payment to confirm the transaction was correct.
6
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OCH0071 50
What options do 24-hour restaurants
restaurants have when the receipt printer is
is located
located in the
cashier booth?
restaurant could
could have
have aa printer
printer in
in the presenter booth as
as well as one in the cashier booth.
booth.
• A restaurant
system will support
support the ability to redirect to either booth for printing.
printing.
The POS system
having two printers
printers is to print of off the front counter register.
register.
• The alternative to having
How do
do you set-up dual
dual drive-thru
drive-thru receipt printers and/or
and!or use a front counter receipt
printer?
required steps will
vary depending
depending on
on the
POS model
model and
and software
software configuration.
configuration. Please
Please
The required
will vary
the POS
POS supplier
supplier or RSSM
RSSM to validate hardware and software configuration,
contact your POS
configuration, and
determine next steps.
is it necessary to get the system on a common POS platform?
Why is
operating system cannot adequately function without a POS platform
platform
Our standard restaurant operating
mandatory features and capabilities. A common POS
POS platform
platform is required to
that provides all the mandatory
support a system wide migration
migration to a standard operating system.
system.
better descriptors
descriptors for
for seating
seating and decor than "contemporary
“contemporary and competitive?"
competitive?”
Are there better
the
NRBES Review
Review Team reviewed
reviewed multiple
multiple proposals to revise
revise the language of this standard.
standard.
The NRBES
The team's
team’s position
position was
was that
that the
the term
term "competitive"
“competitive” carried less subjectivity than
all
the
other
than
language. The
The "contemporary
“contemporary and
and competitive"
competitive” phrase
phrase does not necessarily mean
proposed language.
seating and
and decor
decor must
must meet
meet the
the standards
standards established with programs
programs such as "Forever
“Forever
that the seating
Young, Re-imagining"
Re-imagining” and
and the Major Remodel Program.
required to convert
convert all turret grills to Auto/
Auto! Infinite gap
gap technology?
Why will it be required
conversion will be required by December
December 31, 2014 for the following reasons:
The conversion
provides improved operational flexibility and capacity.
• The auto/infinite gap technology provides
capacity.
1,654 of the 2,580 turret grills
grills range
range in
in age from 14
14 to 25 year. The aging
aging turret equipment
• 1,654
results in ongoing maintenance
maintenance and
and repair
repair issues due to limited part availability and inability
gap. Production
Production of specific parts would require retooling
retooling at a cost
in maintaining the correct gap.
prohibitive.
that is prohibitive.
It is 10 times more likely that a turret grill will not pass a grill certification.
certification. Turret grills
• It
of the population
population and 51% of the grills that don't
don’t meet certification
currently account for 9% of
certification
requirements. The average
average cost to
to bring
bring a turret grill to certification requirement is $1,000
with some units running as high as
as $3,500.
“unapproved equipment"
equipment” section in
in NRBES?
Why is there an "unapproved
discussion with the operator and Field Service relative to any
The intent was to facilitate discussion
using unapproved equipment.
equipment.
potential risks as a result of using
• Any unapproved
Un approved piece
piece of
of equipment
equipment that poses
poses aa risk
risk to food safety, employee safety,
safety,
andfor customer safety will be in non-compliance.
and/or
• Any unapproved
unapproved piece
piece of
of equipment
equipment that
that is
is not
not NSF
NSF or
or UL
UL approved
approved will be
be in
in non-compliance.
non-compliance.
unapproved piece
piece of
of equipment
equipment that does not meet
meet ADA standards will be in nonnon
• Any unapproved
compliance.
compliance.
• Any unapproved
unapproved equipment
equipment that
that can
can not
not adhere to MCD
MCD Quality and Service standard will
be in non compliance.
compliance. An
An example
example isis the
the Cold
Cold Star
Star bulk
bulk cream
cream dispenser
dispenser which is
unapproved and must
must be
be removed
removed by
by 12/31/06
12/31/08 due to the potential
potential food safety risk as a
McDonald’s system.
system.
result of the cream being sourced outside of McDonald's
7
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MCDOCH007156
Exhibit 8
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 2 of 13
COOCHOO7 157
National Restaurant Building and Equipment Standards
for Traditional Restaurants
January 2012
I.
Regulatory Requirements
• Government & Municipal Codes
• ADA Compliance
• Kitchen Fire Suppression
II.
Customer Satisfaction/Quality & Safety
• Building Exterior
Drive-thru
• Playplaces and Playlands
Restrooms
• Lobby/Dining Area
• Front Counter Service Area
• POS
• Kitchen & Prep Area
• Food Safety
Ill.
Employee Satisfaction & Safety
Employee Satisfaction
• Employee Safety
• Physical Plant/Building
• Unapproved Equipment
V.
Required Signatures
Restaurant Information
Region:
Restaurant No.:
____________
____________
State/Site
Natl. Store#
Restaurant Address:
Street
City/State
Original Open Date:
____________________
Franchise Expiration Date:
_______________
Operator Name:
___________________
Or McOpCo No.:
______________
Relocation:
________________
Rewrite:
_________________
Sale:
_______________
Business Review
Note: If you are completing this survey and you are unsure of a response,
please note it in the comments by stating “not reviewed or “not observed”.
12/04/2011
J~ EXHIBIT
D:,ofl
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MCDOCHOO7157
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 3 of 13
~~.~DoCHoo71 57
National Restaurant Building and Equipment Standards
for Traditional Restaurants
January 2012
January 2012
The most recently updated National Restaurants Building and Equipment Standards establishes
a set of consistent national standards that reflect today’s business needs and helps grow our
business by being able to deliver an outstanding restaurant experience. The Field, Franchisee
and Division Management have provided their input in the development of the NRBES tool for
Restaurant Sales, Relocations/Rebuilds, Rewrites and Business Reviews. Universal application
and consistent execution are key components of the NRBES tool.
Vision
The National Restaurant Building and Equipment Standards are designed to identify a
consistent set of standards to ensure every restaurant can be positioned to deliver an
exceptional restaurant experience and support our vision to be our customers’ favorite place
and way to eat. The NRBES enable our ability to execute our best-in-class operating system,
ensuring brand image, food safety and quality, and crew/customer safety and comfort.
Purpose
The NRBES are intended to be easy to understand, consistent and uniformly applied. They are
also intended to clarify expectations, reduce conflicts, eliminate time-wasting discussions on
which standard applies and most importantly, help our customers’ experience the same
outstanding QSC &V on every visit to our McDonald’s.
Appllcat~on
As in the past, the NRBES will be used in all Regions as a means to measure an existing
restaurant for purposes of Restaurant Sales, Relocations, Rebuilds and Rewrites as needed.
To ensure consistent application of the NRBES in all regions, no additions to the NRBES will be
allowed on a regional and divisional level. The NRBES also will be used in the Business Review
process to encourage discussion of common sense steps the restaurant needs to take to meet
the standards. The goal is to remove surprise, develop long-term reinvestment plans from a
business perspective, and insure that all our restaurants are delivering the optimum McDonald’s
experience to our customers.
If there are questions regarding application, please contact your REAL team
representative.
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MCDOCHOO7I57
National Restaurant Building and Equipment Standards
Note: Compliance with this walk-thru does not necessarily constitute full compliance of local
codes
I.
REGULATORY REQUIREMENTS
1. GOVERNMENT & MUNICiPAL CODES
Federal, State, County, Municipal Zoning, Building,
Health, OSHA. Note: Project Manager should inform
of any special requirements.
Yes
No
Comments
2. AMERICANS WITH DISABILITIES ACT (ADA) COMPLIANCE
Constructed and Operational in 1992 or later
o Restaurant must be in total compliance with ADA guidelines including all remodels done during
this timeframe.
•
Constructed and Operational prior to 1992
o Restaurant must meet “Readily Achievable” ADA standards by making those alterations that
are not “too difficult and not too expensive” to accomplish.
o Restaurants built prior to 1992 may be subject to different governmental standards of ADA
compliance depending on the condition of the site, available resources, and any remodeling or
alterations.
Note: Compliance with this walk-thru does not necessarily constitute full compliance with ADA. In order to determine if a
restaurant is in compliance with ADA, a Franchisee can perform an ADA Self Assessment Survey to assess compliance
or the Franchisee may àhoose to hire an architect or other accessibility consultant to complete an ADA survey
3. KITCHEN FIRE SUPRESSION
Yes
No
Comments
Certified cooking equipment fire suppression system
o Ansul Wet System and hand-held fire
extinguishers
o UL-300 R-102 Ansul system where required
by state and local laws
II.
CUSTOMER SATISFACTJONIQUALITY AND SAFETY
4. EXTERIOR
•
Yes
No
Corn ments
All exterior signs should be properly lit and
illuminated, free of cracks, fading and discoloration.
o Entrance/Exit
o Rear Door
o Corral
o Drive-thru menu board
o Drive-thru windows
o Balance of site
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M000CHOO7I 57
•
•
•
•
•
•
•
•
EXTERIOR (cont.)
o Soffit lighting and roof beams
o Building and lot lighting
o Road sign/reader board
o Fascia
Parking stalls designed to meet local code and optimize
lot capacity
Parking lot in good repair (properly graded, surfaced &
sealed)
Parking spaces designed for disabled customers
driving a vehicle
Clearly marked parking stalls
Curbs in good repair
Walks in good repair
Landscaping, well-maintained
A minimum of 2 outside trash receptacles available and
in good repair for restaurants with drive-thru
5. DRIVE-THRUICBB
• Clear directional flow and lane identification
• Drive-thru clearance sign if building has an overhang
a
Menu board in good repair (i.e. Plexiglas, menu strips)
• OPF Drive-thru menu board or FP43 Drive-thru menu
board, with the flip or topper, unless prohibited by local
codes.
•
2-booth speaker or 3-booth face-to-face as a minimum
standard
Yes
No
Comments
_____
_____
______________________
_____
_____
_______________________
_____
_____
_______________________
_______________________
_____
_____
_____
_____
_____
______________________
_____
_____
______________________
_____
_____
______________________
Comments
________________________
________________________
________________________
Yes
No
_____
_____
_____
_____
_____
_____
______________________
________________________
Note: Face-to-face drive-thru will be required to convert to speaker
with COD 18 months prior to franchise expiration date, except
where required by code and noise laws.
a
a
Number of keystations and printers adequate to satisfy
drive-thru configuration requirements
3 keystations are minimum requirement
_______________________
______________________
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MCDOCHOO71 57
DRIVE-THRU!CBB (continued)
• Drive-thru signage in place
• National approved drive-thru branding package
required (except where prohibited by local code)
o Two window signs
o A gateway sign or branded canopy
o “Thank You” message by utilizing at least one of
the following options: a bollard sign, a window
sign, and/or drive-thru lot striping
o Drive-thru lot striping
Yes
No
_____
_____
_________________
Comments
_____
____
________________
_____
_____
________________
______
______
__________________
______
_____
__________________
Note: Go-Go logo remains an approved option
•
•
a
Handrail at building exit adjacent to the drive-thru lane
Drink tower, with fast-flow valves, functioning and in
good repair
Two coffee brewers are required in support of front
counter and drive-thru, except where space limitations
only allow for a single brewer.
_________________
_________________
Note: Space limitations may dictate that both brewers are
positioned together in either drive-thru or front counter
a
•
•
a
•
Cream and sweetener dispensers present and in good
repair (a minimum of one dispenser is required to serve
both drive-thru and front counter. Space limitation may
require positioning on the center island).
Specialty Coffee Machine
Blended Ice machine
OJ Dispenser
Drive-thru windows, functioning and in good repair
Effective, clear communication system (where face-toface is not used) speaker post or Speaker/COD system
o
COD is required
_____
_____
_____
_____
_____
_____
_________________
_________________
_________________
_________________
Note: LED will no longer be supported after 01/01/16
o
o
Drive-thru headsets: a minimum of 5 working
headsets
Instructional signage for customers with
disabilities
6. PLAYPLACES AND PLAYLANDS
a
Required Attach the current PlayPlace inspection to
NRBES document (or GDCT recap) together with
documentation that all findings have been corrected
(including date and the company that corrected the
findings)
a
All unapproved equipment has been removed
Yes
Comments
—
_________________
-
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MCOOCHOO71 57
PLAYPLACES AND PLAYLANDS (continued)
a
No climb netting required on the outside of the play
struäture below 7 feet (84 inches). Review most recent
annual Playplace/Playland inspection to ensure
restaurant is compliant.
• Indoor/outdoor play areas (Playplace/Playland) exterior
egress alarms (e.g. Detex~ are installed and functioning
Yes
No
Comments
No
Comments
No
Comments
_____
PlayPlace Comments:
7. RESTROOM
• Plumbing fixtures in good repair, with either automatic
or wing faucets, pipes are covered if exposed.
• Exhaust fan operating and capable of removing odors
• Floors (tile, grout, base tile) in good repair
• Walls in good repair
• Adequate number of plumbing fixtures as required by
local code
• Ceiling in good repair (painted drywall no lay-in
ceilings)
a
Adequate lighting
• Warm air hand dryers or towel dispensers, soap
dispensers
Yes
_____
_____
_____
_____
—
8. LOBBY! DINING AREA
• Lighting properly illuminated and in good repair
a
Lay-in acoustical ceiling and grid or “exposed” ceiling
system clean and in good repair
• Seating and decor contemporary, competitive, and in
good repair
• Quarry tile floor and base, grout and tile in good repair
a
W1FI (where available), a TV and/or music (ADA
requirements call for close captioning to be enabled if
TV sound is on)
• Adequate seating designated for disabled customers
with the international symbol or accessibility
Yes
_____
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MCDOCHOO71 62
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MCDOCHQO7I 57
9. FRONT COUNTER SERVICE AREA
• Customer conveniences (high chairs, napkin/straw
dispensers, condiments, etc.) attractive and in good
repair
• Front counter in good repair. Note: Under counter
fluorescent lighting fixture must be removed
• MB2K menu board current, meets Marketing needs
• Menu board in good repair
• Digital McCafé board
• Drink tower with fast-flow valves functioning and in
good repair
• Shake and sundae equipment that’s functional, meets
operational standards and supports the dispensing of
TTS product
• One McFlurry spindle and two candy holding
containers in place and in good repair
• Runner Condiment Center or Raised Condiment
(exception required if non-drive thru restaurants or
existing center island space is not available. RCC to be
appropriately sized for space available)
1 pie merchandiser
Yes
P05 SYSTEMIFRONT COUNTER
• NP 6.5 wilt be required 12/31/12
• Adequate number of keystations, printers and monitors
to satisfy QSC standards, functioning and in good
repair
o 3 POS are required as a minimum (exception
for restaurants with counter lengths less than
loft.>
o Monitor Guideline
Front counter monitor: video capture or
merge point monitor
CBB monitor
2 drive-thru order monitors and
1 Danger Zone monitor
o Printer Guidelines
1 printer per front counter register
1 printer for drive-thru located in
cashiers booth
• I printer for prep line
Sticky printer required by 6/1/12
MeCafé sticky printer required by 6/1 /12
• Four KVS monitors and two bump bars
o For restaurants with Cashless: An approved
MeD cashless card swipe device for each front
counter register and cash drawer in drive-thru
Comments
________________________
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______________________
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______________________
______________________
_______________________
_______________________
________________________
Yes
•
No
No
Comments
_________________________
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_____________________
__________________________
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_______________________
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_______________________
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________________________
12/04/2011
HIGHLY CONFIDENTIAL
MCDOCHOO7I63
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 9 of 13
MCDOCHOO7I 57
•
KITCHEN I PREP AREA
• FR P/Tile walls in good repair
• Unglazed, abrasive quarry tile floor or treated non-slip
surface grout in good repair
• Lighting properly illuminated and in good repair
• Vinyl covered board lay-in ceiling and grid or
existing ceiling in good repair
• All equipment cords, plugs and outlets functioning and
in good repair
• Raw and finished product holding time system
available and fully operational
• 2 Clamshell grills functioning and in good repair
o Both auto gap required by 12/31114
a
Annual Grill certifications and PM verification required
• Fryers functioning and in good repair. The restaurant
has enough fry vats to meet McDonald’s QSC
standards, support the menu, and grow the business
• A minimum of one multi-product fryer front is required
when only two vats are available for white meat
production
• Automated Fry Dispenser
• Grill-side meat freezer(s) with minimum capacity to
hold one case 10:1 and one case of 4:1
Yes
No
Comments
______
_____
______________________
—
_______________________
_______________________
—
______________________
______________________
_______________________
_______________________
_______________________
_______________________
________________________
Made For You: A two-sided MFY prep-line is required.
This is the list of equipment required/standard to
execute two-sided prep.
Yes
•
•
a
•
•
•
•
•
•
•
•
•
•
•
•
•
Prep tabie level with HLZ’s and are not to exceed 35”
from floor
I convection oven
2HLZ’s
I UHC heated table dual-sided
UI-IC capacity to support two trays for each item held
in the UI-IC,
I dual-sided heated prep table
I toaster table
2 rapid toasters or 1 universal toaster
I Filet steamer
2 q-ing ovens
1 muffin/bagel toaster (q-ing oven) stand
I muffin/bagel toaster or I universal toaster
Ibunrack
I thaw rack in frozen bun markets
Refrigerated storage sufficient to hold a minimum of
16 salad blanks within 10 feet in the primary initiator
position
A stand alone ice machine in place and in good
repair
No
Comments
_____________________
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_____________________
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_______________________
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_________________________
________________________
________________________
_________________________
_______________________
12/04/2011
HIGHLY CONFIDENTIAL
MCDOCHOO7164
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 10 of 13
MCDOCHOO7I 57
Kitchen/Prep Area Comments:
e
FOOD SAFETY
• AN food storage areas, refrigeration/freezer equipment,
cooking and holding equipment meet McDonald’s Food
Safety requirements
• Functional cooking timers, compensating computers, and
countdown timers (where needed) to support all standard
menu items including, but not limited to, raw meat and
egg products
• Hand-wash sink (one) in kitchen or more as required by
local code, along with a timing system for handwashing
and a means of drying hands
• Washing machine in good repair, clothes dryer (if
required by local code)
• 3-compartment sink, or as required by local code, in a
good repair; proper equipment and supplies for proper
cleaning and sanitizing
• Food preparation sink as required by local code
• Required booster tank and filtration system in support of
fountain equipment. An approved water filtration system
with 0.5 micron filters (either Cuno or Everpure) T9
systems are no longer acceptable
• A minimum of 2 Bulk Coke tanks required for restaurants
utilizing bulk Coke. Bulk Coke tanks must be bolted to
the floor or wall.
• Proper containers for storing opened packages of food
• Properly functioning pyrometer with a food and beverage
probe, grill surface probe, and shortening probe
• All outside doors of the restaurant are seated at the
bottom with weather-strips to prevent pest entry
IlL
•
Yes
No
Comments
______________________
______________________
______________________
______________________
_____________________
______________________
______________________
EMPLOYEE SATISFACTION AND SAFETY
EMPLOYEE SATISFACTION
• Area dedicated to crew comfortable, clean, in good
repair, with seating
•
Clock, mirror
• Adequate lighting in crew area
Yes
No
Comments
—
•
_______________________
______________________
12/04/2011
HIGHLY CONFIDENTIAL
MCDOCHOO7165
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 11 of 13
MCDOCHOO7I57
•
EMPLOYEE SATiSFACTION (continued)
• Training system and materials, complete and current
e Computer-based training system
• Wage and hour labor laws and others posted (from the
state)
• 9-1 poster, which covers basic employment issues,
MSDS sheets (available from 1RC Parts)
• Worker’s compensation poster (state, the employee’s
right-to-know information)
• Office equipment and furniture in good repair
• Adequate lighting in office
Yes
No
Comments
SAFETY
Rear door in good repair and properly set-up as an
emergency exit (no dead bolts or lock bars installed)
• Rear door alarm (i.e. Detex)
• Cooking equipment/exhaust fan/fire suppression pull
station dearly labeled
• C02 safety procedures clearly posted, bulk tank vented
to outside, fill box above ground with safety signs and
labels posted, portable tanks securely chained
Bulk C02 tanks must be bolted to the floor or wall
C02 detectors are required and installed per
manufacturer
• A C02 sensory must be located in the walk-in cooler for
restaurants with Bulk Sweet Tea Dispensing systems
• Shortening filtration disposal equipment, complete crew
protective equipment, shortening disposal cart
Note: Shortening filtration disposal equipment not
required for restaurants with bulk oil
• First Aid Kit meets O&T requirements
Yes
No
Corn ments
12/04/2011
HIGHLY CONFIDENTIAL
MCDOCH 007166
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 12 of 13
MCOOCHOO71 57
PHYSICAL PLANT I BUILDING
• Building exterior, appealing to the consumer, clean and
in good repair
• Supply diffusers and return grills clean and in good repair
• Supply diffusers positioned over aisles, not over food
prep equipment
• Trash corral in good repair (i.e. gate, walls, plumbing,
electrical)
a
All roof surface should be clean and in good repair
• Exhaust fans, belts, and motors operating and in good
repair
• MAC unit operating and in good repair
a
HVAC units functioning and in good repair
o System capable of maintaining 68°F in winter,
78°F summer
• All equipment cords, plugs, outlets functioning and in
good repair
a
Roof ladder and roof access pathways should be safe
and in good repair with lockable hardware on all access
doors
Section 16 Unapproved Equipment
a
Is only McDonald’s approved equipment utilized? If no,
please list any unapproved items
—
Yes
No
Comments
_____
_____________________
_____
______________________
_____
_____________________
_____
_____________________
_____
_____________________
_____________________
_____________________
_____________________
Yes
No
Comments
RECOMMENDATION: lt is recommended that a qualified technician inspect HVAC,
refrigeration equipment, roof and irrigation system It is also recommended that a Power
Audit using CPP documentation, be complete to ensure that the restaurant meets
McDonald’s Power Quality Guidelines
12/04/2011
HIGHLY CONFI DENT1AL
MCDbCHOO7I 67
Case 3:14-cv-02098-JD Document 271-1 Filed 08/17/15 Page 13 of 13
MCOOCHOQ7I 57
IV.
SIGNATURES
Completed by:
Signature
Title
Date
Title
Date
Title
Date
Title
Date
Print Name
Signature
Print Name
Signature
Print Name
Signature
Print Name
12/04/2011
HIGHLY CONFIDENTIAL
MCDOCHOO7IS8
Exhibit 9
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 2 of 8
From:
To:
Sent:
Subject:
Attachments:
Dubois Steven
Smith Michael (US Partners)
11/4/2014 9:58:28 AM
RE: Action Plan Telegraph
Action Plan report-1745.htm
Hi Michaels
EXHIBIT j./.5=
Ashley Soevyn, CSF2 No. 12019
Date
Witnes
I hope this is the one you are looking for. This is the only one I found.
Thanks,
Steve
From: Smith Michael (US Partners)
Sent Monday, November 03, 2014 3:13 PM
To: Dubois Steven
Subject Action Plan Telegraph
Good afternoon Steve,
Could you please get the last action. plan for the last. FOR. that we came up with for store #1745 telegraph. Thanks I'm
having a hard time retrieving the info.
Sem from my Siimsung, (.4aIrmy smmiphohc.
HIGHLY CONFIDENTIAL
MCDOCH018770
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 3 of 8
Open objectives only Open objectives only
Restaurant Action Plan
Restaurant
(1745) OAKLAND-TELEGRPH
Restaurant Address
4514 TELEGRAPH AVE, CA, ALAMEDA, OAKLAND, 94609-2020
Owner/Operator
Edward Smith
Franchisee
Consultant
Date
The action plans below have been developed and agreed upon by:
Franchisee
(Consultant
System - 1 : Production
Category
QSC
Objective
To serve each and every day the highest quality products
Objective modified date
21-June-2013
• Restaurant manager ensures MFY standards are executed according to standard
Key Success Factors
• Restaurant Manager maintains production charts
Action ff 1
Person Accountable
Target completion date
Kitchen Department
manager and GM
22-July-2013
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
1. Focus on breakfast procedures in the grill area 2. Kitchen staff as well and
production manager know how to calibrate the grill to get achieve that sweet spot for
the beef coming of the grill 3. Perform SOC's on all production staff to ensure all
procedures are being done correctly
Measurement
1. RDM is taking place within the restaurant and is being done correctly to impact the
store on a positive basis 2. SOC's being perform by the department manger and being
communicated 3. Training to all productions staff on what good quality looks and taste
like
Comments:
System - 2 : Service
Category
QSC
Objective
To provide the highest quality service to each and every guest
Objective modified date
21-June-2013
• Service employees effectively communicate with the guests
• Shift/service manager responds appropriately when there are 3 or more guests in
line at a register
Key Success Factors
• Order taker/cashier responsibilities are split if 4 or more crew are scheduled in
Drive-thru
• Shift/service manager responds appropriately when there are 3 or more cars at
the DT order point
Action # 1
HIGHLY CONFIDENTIAL
Person Accountable
Target completion date
General Manager Guest
Service manager
21-July-2013
'Actual Completion Date
MCDOCH018771
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 4 of 8
Action(s) agreed upon to
ensure root causes are
corrected
1. Make sure the staffing levels in the restaurant are correct during the peak I snack
hours 2. Check staffing levels to have a drink specialist if the drinks per hour call for it
3. Pre make oatmeal to speed up the service experience 4. Shift management needs to
understand the danger zones and make good decisons
1. Service time's should improve 2. Utilizing the staffing needs report should be
checked monthly 3. Observing the shift managers and working with them shoulder to
shoulder to understand how to make decisions on the floor
4easurement
Comments;
System - 3 : Production
Category
Sales
Objective
Two sides of the table open during all peak periods minimum 80% of the time as of
May 31, 2013
Objective modified date
02-May-2013
• Initiator stays in position
• French fry person stays in position according to positioning guide
• All stations are properly stocked for 24/2
Key Success Factors
• Restaurant manager ensures MFY standards are executed according to standard
• Restaurant Manager maintains production charts
'
• Shift manager responds appropriately when there are 3 or more orders on the
KVS or 3 or less orders of fries prepared
Action # 1
Person Accountable
Target completion date
Laura
19-June-2013
Actual Completion Date
Action(s) agreed upon to
en sure root causes are
corrected
Ensure that enough people are scheduled to allow the second side to be open.
Measurement
+VLH during peak period.
Commen
•
System - 4
h i ft
anagement
Category
QSC
Objective
To run great shifts to provide every cutomer with great QSCV
Objective modified date
18-Mar-2013
• Managers visible on floor actively, managing by observing (from observation
post) service and production barriers, danger zones and crew positions
• Pre-shift Checklist is used
Key Success Factors
• Shift manager is shift certified/verified
• Crew are positioned according to the positioning guide and stay in position
• Shift targets/ information are communicated to all employees
• Crew recognized and rewarded for meeting targets or excellent performance
HIGHLY CONFIDENTIAL
MCDOCH018772
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 5 of 8
• Shift manager interacts with guests and follows guest recovery process when
necessary and role models hospitality
• Travel path is conducted by manager every half hour, priorities set and action
taken
Action # 1
Person Accountable
Laura
Target completion date
. ..
31-Dec-2012
!Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
Ensure all new managers and old attend McDonalds classes Having good
coomunication with your management staff React to all danger zones Follow-up of
schedule's and make sure that there is a good schedule posted Set and Communicate
Targets
Measurement
schedule for classes weekly/monthly rap seesions with management staff following-up
with store manager write-up's must take place
Comments:
Action # 2
Person Accountable
Target completion date
General Manager / All
restaurant staff
31-Dec-2013
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
Bring CSO score below 20% for this year
Measurement
1. SSP is taking place and being follow up on a weekly and monthly basis 2. Ensure
shift manangment is adhering the danger zones and reacting 3. Good HTW practices
are taking place with good interviews, orientations and on the floor training is
happening 4. Celebrate when the goals are meet
Comments;
Action # 3
Person Accountable
Target completion date
General manager/
Production manager/ Guest
Service Manager
18-June-2013
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
Maintain 1000 cars per day in the Drive-thru
Measurement
1. Have the proper number of crew on the floor and focused 2. Maintain split function
for the drive-thru team 3. Ensure good shift managment is taking place 4. Open 2nd
side of the prep table 80% of the time 5. Ensure that all equipment is working
Comments:
System - 5 : Business Plannin g
Category
Profit
Objective
To run a profitable business while maintaining a high standard of sucess
Objective modified date
18-Mar-2013
• Assess and reassess the business Develop goals - CSC- People - Sales - Profit
Key Success Factors
• Communicate the goals
• Provide resources and motivation as needed
• Oversee execution of action plan and provide feedback
HIGHLY CONFIDENTIAL
MCDOCH018773
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 6 of 8
• Measure results, recognize and reward
Action # 1
Action(s) agreed upon to
ensure root causes are
corrected
ieasurement
Person Accountable
Targetompletion date
Laura
31-Dec-2012
Actual Completion Date
The routine for food cost must be as follows: 1-Establish and communicate store
guidelines for each food cost after entering QCR projection at least 25th. of each
month fOr the next month 2-Restaurant must identify and do a daily five items from
the daily and weekly all food items inventory 3-All transfer-in and out must be entered
at the ISP 4-I mmediately after pulling and troubleshooting the weekly stet, pull a
month to date QCR Report 5-Once Food Cost Areas of opportunity are determined;
observe the ON-FLOOR procedures that impact those areas:
Improve Food Over base by at leastl% starting December 2011 to December 2012
Comments:
Action # 2
Person Accountable
Target completion date
General Manager / Swing
Management Team
18-May-2013
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
Lower Food Cost to below 3.5% food over base and increase the P&L to the top 25% of
the regional average
Measurement
1. Ensure UHC chart's ar being followed 2. Weekly managers meeting to discuss
progress on food cost 3. Review all 7 items under the QCR report ie. raw waste/
complete waste 4. Review P&L's on a monthly basis and make new goals
Comments:
System - 6 : Production
Category
—
Objective
QSC
Objective modified date
20-May-2012
To provide every customer with quality food
• Initiator stays in position
• French fry person stays in position according to positioning guide
• All stations are properly stocked for 24/2
Key Success Factors
• Restaurant manager ensures MFY standards are executed according to standard
• Restaurant Manager maintains production charts
• Shift manager responds appropriately when there are 3 or more orders on the
KVS or 3 or less orders of fries prepared
Action # 1
erson Accountable
Laura
Target completion date
—
31-Dec-2012
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
open second side of the prep table when the sandwich count is more than 100 having
a headset worn by production manager following production charts Utilize DSPT
Measurement
visually checking kvs reports being checked and also setting achievable targets
communication with all staff
Comments:
System - 7 : Shift Management
HIGHLY CONFIDENTIAL
MCDOCH018774
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 7 of 8
Category
QSC
Objective
to coordinate production,equipment and people to achieve great QSC
Objective modified date
29-Sept-2008
Key Success Factors
Person Accountable
Target completion date
Action # 1
store manager/production
and service team
31-Dec-2008
Action(s) agreed upon to
ensure root causes are
corrected
preshift checklist is being done daily proper postioning according to the positioning
guide based on the sales rate pulling reports every 30 minutes and communicating the I
I
results tarrgets be set daily
Measurement
improvement in service time mystery shop score increase all equipment is working
preshift checklist is being done check positioning daily
!Actual Completion Date
Comments:
System - 8 : Production
Category
QSC
Objective
provide all products needed and provide fast accurate friendly service to each and
every customer
Objective modified date
29-Sept-2008
Key Success Factors
Action # 1
Person Accountable
Target completion date
store manager/production
managers
31-Dec-2008
Actual Completion Date
Action(s) agreed upon to
ensure root causes are
corrected
manage kvs danger zones preshift checklist being done properly wach and everyday
proper positioning food safety being done everyday
Measurement
pulling reports every 30 minutes preshift checklist being done daily and properly check
uhc levels and communicate targets manage danger zones
Comments:
•
The above action plans and dates have been developed and agreed upon,
Signature of Restaurant Manager
Signature of Owner / Operator or McOpCo Supervisor :
Date :
Consultant Signature :
CONFI DENT] AL AND PROPRI ETARY I NFORMATI ON
HIGHLY CONFIDENTIAL
MCDOCH018775
Case 3:14-cv-02098-JD Document 266-2 Filed 08/17/15 Page 8 of 8
O McDonald's Corporation. The material contained herein is the exclusive property of McDonald's Corporation
and has been prepared exclusively for use of designated McDonald's recipients that are employees or licensees
of McDonald's Corporation. Any unauthorized use or copying of this material may lead to civil or criminal
prosecution. (33917)
HIGHLY CONFIDENTIAL
MCDOCH018776
Exhibit 10
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