Business
10 Countries Where McDonald’s Failed
McDonald’s is the largest fast-food chain in the world, with 37,000 restaurants in 118 countries. This fast-food giant is dominating the industry… But is it in trouble? Recently, McDonald’s lost its trademark on the Big Mac, and Burger King picked it right up. With names like ‘Anything But A Big Mac’, Burger King hilariously trolled McDonald’s on social media. But it’s not just Burger King that McDonald’s is fighting against! From war to wanting more, there are many reasons why McDonald’s struggles to set up successful restaurants overseas, and these are the top 10 countries where McDonald’s has completely failed.
10. Macedonia
Macedonia, a small European country in the Balkans, was once home to seven glorious McDonald’s restaurants, with a few in the capital, Skopje. Surprisingly, despite the population of 2.074 million, there was little presence from McDonald’s apart from one small franchise. These restaurants had been run in Macedonia for 16 years and had been successful there. Until one day in 2013… poof! With no warning, all of the restaurants were closed overnight, and hungry customers were confronted with a ‘temporary closure’ notice in place of their morning McMuffin. So, what happened? The franchise owner was quick to confirm this was not due to an inspection or health and safety issue, but instead stated that they had lost the licence from McDonald’s to remain open. Rumor has it that the head of McDonald’s European office fell out with the franchise owner, and so the licence was revoked. Since then, no other McDonald’s restaurant has been allowed to operate in the area, so I guess they’ll have to get their breakfast elsewhere.
9. North Korea
Ok, this one seems pretty obvious. It is pretty well-known that North Korea and the US have been hostile since the Cold War and tension was grew after the Korean War back in 1950! In more recent times, Americans have even been banned from North Korean soil, so it is unsurprising that the huge American corporation is not allowed to operate there. However, Kim Jong Il claimed to have invented something called ‘Gogigyeopbbang’, which means ‘double bread with meat’, and was essentially a hamburger. Despite this replacement, the richest North Koreans still import McDonald’s by plane from McDonald’s restaurants in China, according to The Telegraph. It seems even Kim Jong-un is being won over by the fabulous food, as a South Korean official said that North Korea is eager to secure investment from American companies such as McDonald’s. Three US officials also indicated that Pyongyang, the capital of North Korea, was considering having a Western burger restaurant as a sign of the new unity between the US and North Korea. It is unclear if these plans are going ahead, but if it does, this might be the best trade deal in the history of trade deals, maybe ever!
8. Jamaica
McDonald’s had been running in Jamaica since 1995, opening 12 outlets in the first four years. After 10 years of underwhelming sales, the franchise owner had to give up on the dream of owning a huge chain of fast-food restaurants across the country. But how could such a successful business fail? Apparently, there were a few reasons for the failure, the most severe being the tiny burgers. For this reason, Burger King managed to survive in Jamaica after McDonald’s failed. Another reason is the locals becoming upset that McDonald’s imported the majority of their meat rather than buying it locally. Although this was changed, other menu issues such as the lack of classic Jamaican food and alcohol in McDonald’s restaurants. This meant that the owner had to close all their stores, and no one has been brave enough to try it again. Well, its not just that, McDonald’s also reportedly asked for $2 billion from the local businessperson to kickstart their investment in a franchise, as well as spending a whopping 9 unpaid months working in the restaurant. Oof! That’s quite a big ask. Needless to say, Jamaica won’t be ‘lovin’ it’ any time soon.
7. Barbados
Midway through the 90s, McDonald’s set up their very first store in Barbados, an island famous for its beautiful beaches and rich culture. This was part of a big push to move McDonald’s into the Caribbean and grow their empire. Looking at the mess they made of their move to Jamaica, it’s not surprising that this was also unsuccessful. Although there was some interest at the start, McDonald’s only lasted 6 short months on this idyllic island. It seemed Barbados was not too keen on the processed, bland American food that McDonald’s offers. Many people said they preferred the fresh chicken, fish and other tropical treats that they could get from the island. Unfortunately for Ronald McDonald, the food in Barbados is much healthier and flavorful than the food McDonald’s offers, and the locals prefer this diet. This fast-food titan was promptly moved off the island, and the restaurant has since been painted blue and is now a financial services office (because that’s obviously the next logical step). The locals seem happy with the move and can still go to one of their KFC or Burger King restaurants for a cheeky taste of US cuisine when their cravings hit.
6. Bolivia
This Latin American country of 11 million people is, like McDonald’s, home to a very large amount of salt (10,582 km2 worth to be precise). Seems like the perfect setting for some French fries, right? Wrong. In fact, this is the only Latin American country without a McDonald’s! But that’s not to say they weren’t once McDonald’s mad. When it first arrived in 1997, it was seen as a good place to socialize and was constantly bustling with hungry customers. 2 years later, there were 6 restaurants operating in Bolivia, but the novelty was starting to wear off. In 2002, after a decline in sales and some botched attempts at selling to the middle-class, McDonald’s were forced to close all stores. So why couldn’t it stay afloat? The biggest factor is probably the economy. In 2002, Bolivia had more than 60% of its population living in poverty, and this was a luxury most people couldn’t afford. Although it seems like cheap food to us, Bolivia actually has similar ‘meal deals’ from local restaurants or street vendors for half the price. Now THAT’s what I call value. Vendors also offered a variety and tradition that McDonald’s just couldn’t compete with. Since then, the Bolivian president has said ‘fast-food in the west is doing a great deal of harm to humankind’. Yikes! Clearly, the Bolivian people aren’t happy with American fast-food and want to stick with what they’ve got. Fair enough, who doesn’t love a bit of street meat?
5. Iceland
Iceland is a plucky Nordic country with volcanoes, geysers, springs and around 340,000 people (for reference, that’s roughly 1% of Canada’s population). Due to it small population, it can be difficult to break into the Icelandic economy, so there aren’t many global franchises in the country. In 1993, when McDonald’s opened, the locals were over the moon! The Prime Minister at the time was pictured sinking his teeth into a burger, and it made all the papers (that was basically viral in those days). It became fairly successful in the country, although it had to compete with a beloved home-grown burger chain called ‘Hambórgarabúllan’. What a mouthful! (pardon the pun). Things took a turn for McDonald’s during the 2008 financial crash, or ‘Credit Crunch’. It just became too expensive to run a restaurant, and McDonald’s had to give in. When McDonald’s announced its closure in 2008, around 15,000 people lined up to get one last Value Meal while they still had the chance. This was such a big deal that the last burger to be sold is still kept in their national museum. Worryingly, it still hasn’t started to go bad although it’s roughly 10 years old. If you want to see it, there is a webcam running on the exhibit constantly so you can check in for decay whenever you want!
4. Iran
So, it’s becoming pretty clear that American businesses like McDonald’s aren’t always welcome overseas. Gee, I wonder why! Amazingly, there was a McDonald’s in Iran once upon a time, which closed in 1979. McDonald’s got the boot during the revolution in Iran, after which there was a massive rejection of American culture. McDonald’s isn’t alone in this; lots of other American things have also been banned, including everyone’s favorite cartoon family -The Simpsons! Look, I know what you’re thinking: how do they survive without it? Well, Iran actually has a mock McDonald’s called ‘Mash Donald’s’, which uses a suspiciously similar logo. This boasts a delicious menu including the ‘Mash Donald’s baguette burger’ (instead of a Big Mac) and a 46-centimeter long sandwich! Amazingly, after many years eating the copycat’s food, it seems Iranians might be about to get the real deal. Bridges are being built between the two countries… maybe a restaurant can be too! McDonald’s have said ‘in the future we may take steps to open McDonald’s restaurants in Iran’, so it’s looking promising. There is already a franchise application online for setting up stores in Iran. Don’t get too excited though, this is also true for other countries that the US currently can’t trade with, like Syria. All we can do is wait to see if anyone picks up the offer.
3. Zimbabwe
Zimbabwe is a country in southern Africa home to Victoria Falls and McDonald’s Fails. For McDonald’s, Zimbabwe is a nut they’ve never quite managed to crack. In 1997, McDonald’s began looking at setting up their latest McVenture in Zimbabwe with the hope of opening a new restaurant in 1999. Things were looking promising at first, and then… BOOM! That’s when a huge political s**t storm happened (which was completely unrelated to McDonald’s, of course). This tanked the economy, and unemployment and inflation rates hit the roof! Money had basically no value due to hyperinflation. Obviously, McDonald’s could no longer move there, and so plans were put on hold. Zimbabwe has struggled to steer its economy back, and it is still a turbulent time to invest. Naturally, McDonald’s has kept its eye on Zimbabwe anyway, and they ‘will take steps to open McDonald’s in Zimbabwe’. But is this likely to happen? Well, this could be a problem for existing fast-food joints that already operate there. Nando’s and Steers are very big names in the south of Africa and have stayed profitable even in the financial uncertainty. They are going to be some serious competition for McDonald’s! If McDonald’s want a place at this table, it looks like they’ll have to fight for it.
2. Montenegro
This small Balkan country of just 600,000 people has mounted a surprising amount of resistance against the addition of a McDonald’s store to Montenegro. In it’s capital, Podgorica, McDonald’s used to operate a tiny mobile restaurant. You’d imagine that this went badly, and that’s why they haven’t come back, but its actually the opposite. At the time, business was good, and it is thought that McDonald’s closed due to governmental pressure. Local reports suggested that they were concerned about the healthiness of the food. This checks out, as Montenegro also has no KFC, Burger King or other American fast-food joints. Instead, the people tend to eat local, traditional and cheap meals from kiosks which offer quick takeaway food. You can literally get twice as much for your money from these local traders, as big Balkan burgers cost just €1.50! Add into the mix that these are all made fresh and it is obvious that McDonald’s doesn’t really fit in there. The tiny population makes profits more difficult to guarantee and increases the price of the ingredients as lots of them would have to be imported. All in all, it’s a completely unfeasible place for McDonald’s to invest there. Montenegro does have a few places to grab a nice American burger if you’re really desperate though, like the Hard Rock Café. It’s close enough, right?
1. Vietnam
Vietnam currently has 17 Maccy D’s, but these might not be here for long. Despite their success in other Asian countries, such as China, where it is the second largest foreign fast-food chain after KFC. Given this success, McDonald’s planned to open 100 stores between 2014 and 2024 in Vietnam, but half-way through, they’ve achieved less than 1/5 of this target. You might assume that this is due to lasting tensions between Vietnam and the US over the Vietnam War, but it is actually more complex than that. It mostly comes down to the fact that the markets sell food even faster than McDonald’s (which I didn’t think was possible) and so the idea of picking food up on-the-go isn’t interesting to them. In big cities, the ground floor of lots of houses are converted to run rapid street vending stores, and so whole streets of variety are available for the Vietnamese consumer. In this foody world, McDonald’s is on the pricey end and so it is not really practical for getting everyday meals. The McMenu is also more expensive to cook than the native Vietnamese foods, such as Pho, and so McDonald’s prices can’t be cut any lower to compete. Another problem is that in Vietnam, sharing food is a social and cultural norm, and burgers also aren’t really ‘sharing food’ (especially not if they’re mine). Unfortunately for McDonald’s, the interest started off low and is getting even lower, with fast-food visits dropping 31% between 2016 and 2018. Street vendors, on the other hand, are still booming and have been getting more popular. It is looking more and more like the Americans will have to retreat once more from Vietnam.