Franchisee Application

Skills & Requirements

Skills and requirements

As we are a Nordic organisation our common business language is English. This applies also to the business documents we use and some of the interviews along the recruitment process. In the markets and our restaurants we predominantly use the local language, but English is good to master there, too.

A certain set of skills, characteristics and behaviours are great to have for a Franchisee to become successful and which we see essential. These skills and characteristics consist of eight distinct competencies, which fall into three categories:

• Cognitive skills: Strategic business planning, Problem solving, and Business focused decision making
• Interpersonal skills: Communicating and influencing, Leading people, and Personal ambition and resilience
• Action skills: Corporate citizenship, and Brand Ambassador

What's the deal?

Becoming a McDonald's Franchisee is a long-term commitment as well as a long-term possibility to create a flourishing business and leaving a legacy of success. It will entail some financial investments as well as hands-on, at times even hard-working, approach to run a customer-oriented business and supporting the people working for you, and with you, to grow professionally. We have an aspiration to grow with each and every of our Franchisee to a portfolio size of 5 or more restaurant within few years after joining us. Hence, entrepreneurial mind-set, strategic business planning, focused decision-making and willingness to develop oneself are fundamental characteristics for our Franchisees.

Financially speaking, the price of a restaurant typically ranges from EUR 1 250 000 to EUR 2 000 000. The price is unique to a given restaurant, its location, sales, profitability, future projections and the selling entity, which can be another Franchisee or the local Food Folk company. Optimally, you would invest 25 % of the restaurant's purchase price from your unencumbered funds and have the rest funded through a bank loan. In certain circumstances, we may also be able to offer alternative financial arrangements.

For financing the loan there are certain banks we work with, and which know the specifics of McDonald's business setup making it easier for you to start the discussions with them — and our Head of Finances at each of our markets are here to help you start those conversations and give you basic knowledge of our business.

In addition to the purchase price, a one-off Franchise Fee of USD 45 000 is also required at the start of the Franchise. During the 20-year Franchise term there are some ongoing fees, too. These include:

• Monthly rent, which is paid on the premises. As an average, our monthly rents vary between 11 % and 17 % on the gross sales. This rent is usually fixed for the 20-year term.
• Service Fee, or Royalty provides access to use the services of the McDonald's System and is currently 5 % of monthly gross sales.
• Marketing Contribution to the National Marketing Co-operative spend for which the % level of the contribution is confirmed annually by the local Marketing CoOp. All our Franchisees are members in their local Marketing CoOps, which are the collaboration venues where Franchisees, Food Folk's marketing experts, and creative & media agencies come together to create some of those world-famous – and indeed award-winning – marketing activities and campaigns.

You would also need to divest any and all other business interests prior to commencing the full-time Restaurant Training. And when it comes to nature of our Franchise agreement, it is always an agreement between us and you i.e. with one individual, the Franchisee, meaning that no outside partners or investors are permitted. On the bit more technical side of matters, you must have legal capacity and not been convicted of a criminal offence which is not a spent conviction. Also, a credit report will be requested the application journey, and we will also complete an identification check.

And what about restaurant location? After successfully completing the Application Program and your Restaurant Training & Classroom Courses you will be eligible to purchase your first restaurant. It is noteworthy to understand that we are unable to confirm any specific site or location prior to this step as our portfolio evolves over time and lives through its life cycle with currently existing Franchisees and market developments. This is why in the application form we have questions for you on your geographical preferences and flexibility. During your application journey we will discuss geography-related matters with you and this web application is just the beginning.

In the end of the day, many of the above points encapsulate into what we call for from each and every of our Franchisees: your willingness to give the McDonald's business your full time and best effort to make and maintain it a world-class experience for our guests and employees alike – while maintaining it commercially healthy and lucrative for us all.