McDonald’s, an emblem of American living and capitalism, is selling its Russia business as it prepares to exit the country completely after more than three decades.
This is a significant step forward for the brand, whose global expansion has made it a symbol of globalization and even the cornerstone of peace philosophy. The Russian invasion of Ukraine has prompted many corporations that had planned for business as usual to take action since globalization goals have weakened in recent years due to the coronavirus outbreak and geopolitical concerns.
Many companies and restaurant chains have partially – or fully – ceased operations in Russia due to mounting pressure from staff and customers. However, few people left totally owing to worries about employee safety and the difficulty of returning after leaving. In Walks, McDonald’s said Many other businesses, like Starbucks and Yum Brands, the parent firm of KFC and Pizza Hut, have temporarily closed their operations there. The entire order deflation was paid for by several employees and protestors.
In a letter to franchisees, staff, and suppliers seen by The New York Times, McDonald’s CEO Chris Kempczynski wrote: “This is a difficult, unprecedented situation with catastrophic ramifications.”
“Some could argue that continuing to employ tens of thousands of regular individuals while giving access to food is the correct thing to do. However, the humanitarian situation generated by the war in Ukraine cannot be overlooked. It’s inconceivable to see the Golden Arches as a symbol of hope.” And it was this promise that drew us into the Russian market 32 years ago.
McDonald’s wants to sell its firm to a local buyer, which employs 62,000 people and has 850 restaurants (including franchise-operated locations). It will “remove the bracket” from such restaurants, implying that they will no longer use the McDonald’s name, logo, or branding. McDonald’s “Priorities include ensuring that McDonald’s employees in Russia continue to be paid until any sale is finalized and that staff has future jobs with any possible buyer,” he added in a statement. In Russia, it will preserve its trademarks.
McDonald’s would write off $1.2 billion to $1.4 billion as a result of the decision, as well as realize “foreign currency translation losses,” according to the company’s statement.
Kempinski said in his email to franchisees, staff, and suppliers that McDonald’s first entered Russia during the 1976 Olympics in Montreal when the business permitted the Russian Olympic team to utilize the Big Mac Bus. McDonald’s launched in Moscow fourteen years later, in January 1990.
Mr. Kempczynski added, “In McDonald’s history, he was one of our proudest and most exciting.” “After nearly half a century of Cold War enmity, the picture of the golden arches gleaming over Pushkin Square signaled the dawn of a new era for many on both sides of the Iron Curtain.”
McDonald’s, which has 39,000 restaurants in over 100 countries, has subsequently invested billions of dollars in its Russian supply chain and stores.