I understand individual actors following incentives wherever they lead. I wouldn't say condone, but understand. What I don't understand is how it came to pass that McDonalds, whom I would assume are canny and cutthroat in their own right, would find themselves maneuvered into a position like this.
Is there no equivalent phenomenon when it comes to their grills, deep fryers, drive-thru comms systems, self-order kiosks, etc?
Here [1] is a video on this topic by Johnny Harris from a couple years ago. It's been a while since I watched it but IIRC there is a conflicting relationship between specifically McDonalds the corporation and Taylor which benefits both of them but screws over the individual franchise owners. Here is an interactive map [2] that shows where all the broken machines are.
All franchise brands do this once they have sufficient power relative to the franchisees.
Hotel brands force hotel owners to use only certain vendors, taking a kickback from the vendor. Same with restaurants/etc.
I can give a specific example. Roughly 8 years ago, IHG hotels required all of their branded hotels to only sell Coca Cola products. The only reason this would happen is if Coke paid IHG.
It has nothing to do with a person’s hotel stay. It just restricts hotel owners and hotel guests from being able to sell and buy their preferred products, such as Red Bull or Starbucks or Pepsi/Tropicana, for the benefit of Coke and IHG.
If I'm following OP's question, it was basically that all of this makes sense from a "people are doing what benefits them the most" POV.
But some time went by and it morphed into being overall bad for the McDonald's brand, and that's the puzzling part of it. You would think Micky D's would have power to step in and say "enough is a enough, this is hurting our image, quit fucking around and fix the machines or we find another vendor."
I would agree Micky D's corporate probably does have sway here, so this problem probably just isn't interesting or important enough for them to do anything about it. Maybe ice cream is such a small part of their sales they don't see the point in raising a stink about it. Or maybe the vendor just happened to Game of Thrones their way into a little niche of power that Ronald can't do anything about.
And for the size that they are, I find that pretty interesting and puzzling as well!
> If I'm following OP's question, it was basically that all of this makes sense from a "people are doing what benefits them the most" POV.
I wouldn't go so far as to say that it makes sense, but it's no surprise that things break down when a bunch of people who should be working together each act selfishly. As you'd expect nobody really wins, but it's the little guy that gets screwed the worst. Customers don't get ice cream, employees deal with frustrated customers, franchise owners lose time and money, the shitty vendor gets worked around, and the corporation's image takes a hit for being the ringleader of this circus.
Possibly apocryphal, but I'd heard the reason most Marriott (and their associated brands) have Pepsi vs. Coke is 'cause Marriott Sr. asked Coca-Cola for a loan some years ago and they refused him.
Do they? Pepsi has been making a big push into "rich people places" (air ports, ski resorts, conference venues, that sort of thing) and the usual result is not that I ask for a Diet Coke and one appears, it's that I ask and one fails to appear, and continues to fail to appear at every place I visit on the entire trip/vacation and I simply must go without. Which is fine, it's just a flavor, but this is noticeable and repeatable and annoying and almost exactly the opposite of the situation where a bar has a strategic reserve of the good stuff.
The ones I've seen do - and pretty expensive hotels, too.
If you're running a conference and ask them to get some coke from the bar, they usually have been able to get it (it's also possible they have a secret "guest happiness" stash) - and I've seen them pour it at the bar - Pepsi is from the spigot machine, Coke from a can.
Rules are different if you are at a bar and paying bar prices for bar products, I get that, but it's not what I'm looking for. I could also go out of my way to buy from an unaffiliated store and schlep the stuff, but I'm just not that much of an addict. My point is that I don't think it's reasonable to be dismissive of Pepsi's "accomplishment" here -- they have arranged a substantial enough barrier to corral the behavior of someone with a significant (though not mountain-scaling) preference to the contrary. Significant enough that my fallback is usually water. Like out the toilet.
Is that an actual preference or just spite-driven? Nope, sprite is a Coke product, we don't serve that here! But seriously, it's a real preference, it holds for the generics too. Most generic colas seem to be based on the Pepsi taste. Ugh. RC isn't, so RC Cola is fine, but too rare to ever be helpful. Caring about this is a curse!
I think they’d just make it with Pepsi and call it a “rum and coke” anyway. “Coke” is the generic word for all soda/pop, including Pepsi, in much of the US and world, and I think “rum and coke” also qualifies as a name in its own right.
>“Coke” is the generic word for all soda/pop, including Pepsi, in much of the US and world
I don't think this is even true for most of the USA, much less the world. I've never heard anyone refer to anything except a cola as "coke" although I heard that was the vernacular in some subset of the US... some southern US states?
It isn't that niche. Probably in second behind "soda" pop being in third place. Some areas have other names like "cold drink" that while seeming generic actually only refer to carbonated sweet beverages.
I'm really surprised kickbacks haven't become illegal. It seems that a lot of really bad behavior can be traced to that especially in the medical field.
It also pretty much just hurts the consumer as well since competition (or lack thereof) is based on who gives the seller the most money.
Beyond vendor kickbacks, hotel brands do have legitimate reasons to ensure a consistent guest experience regardless of which franchisee owns a particular property. Frequent travelers can be surprisingly picky about little things like soft drinks and they don't like surprises.
Then they would have required offering specific products. It would not require prohibiting other products.
Edit: to respond to tomnipotent:
I don’t see why a distributor is relevant. There are myriad to choose from. Hotel owners/operators can buy from the local Coke/Pepsi/whatever distributor, or Sam’s/Costco/grocery store, or Restaurant Depot/US Foods, etc.
Edit 2: note that IHG is not buying the beverages to sell in the franchised hotel, the IHG franchisees are. IHG does not suffer any costs from making an exclusive deal with Coke, or not making an exclusive deal with Coke.
> It would not require prohibiting other products.
You're forgetting about distribution and margin. Your distributor is unlikely to offer both choices, and keeping the original product means selling less of the new so you're getting less favorable volume deals with both. For the hotel, it makes sense to concentrate that sales volume into a single contract for better discounts.
It's definitely possible, and I've seen it done, but obviously for most businesses that have to answer the "coke or Pepsi" question pick one. Nothing is really preventing having both in the same soda machine, but it's rare enough that there must be a reason, likely exclusivity deals and discounts.
Gas stations will usually have both, for example. Fast food places won't.
There is two "McDonald's" the corporation, that requires a specific machine and by extension a specific company to repair it exclusively, and then there is a ton of "McDonald's" franchises who are the victims (paying the literal price).
So McDonald's corporate didn't get out-maneuvered, they just found a new way to extract money from their franchises, who tried to fight back (and kind of lost the first battle).
Sounds like the FTC/DOJ are stepping in to give the franchises more ammo to fight back with.
> and then there is a ton of "McDonald's" franchises who are the victims (paying the literal price).
Everybody loses in this situation. the biggest victims here are the consumers who can't get the products that they want, and have had to resort to developing/using apps to track down working machines, followed by the employees who have to deal with the constantly angry/frustrated customers, followed by the franchise owners who are losing money and disappointing their customers. The franchise owners are acting in self-defense by working around the vendor which means the vendor is losing money on service calls, and the corporation loses because (quite rightly) their image suffers for causing this mess in the first place and allowing it to continue.
> grills, deep fryers, drive-thru comms systems, self-order kiosks, etc?
The key difference between all those things is there's almost no moving parts involved.
Grills are simply resistive heaters and a thermostat that will outlast everyone.
Deep fryers are exactly the same, but with a tub to put in oil.
Drive through comms systems are simply speakers/telephone systems with the only moving part being the speaker itself. (The rest is software).
And The kiosks are basically just giant touch screens with a small computer running everything.
Ice cream is different. It's a thick highly spoil-able product being pushed through tubes which need to be clean. It involves a refrigerant and often a mixing device to keep the ice cream from freezing solid. Mcdonalds isn't the only one with icecream machines that constantly break down. If you notice, everyone has this problem. It's simply a hard product to serve in a sanitary way using machinery.
>Deep fryers are exactly the same, but with a tub to put in oil.
Not really true. The fryers used by McDonalds and the vast majority of QSRs are digitally controlled have a fairly sophisticated recirculating filter system to keep the shortening in good condition. The state of this system is much less critical from a food safety standpoint, but it can be extremely hazardous to employees for obvious reasons. The pressure fryers used by fried chicken restaurants are potentially even more hazardous. To my knowledge, none of these systems have weird DMCA-protected firmware to prevent unauthorised maintenance.
I do think there's a little bit more difficulty in the ice cream machine that doesn't exist with oil.
I went and watched some videos on fry machine maintenance (lol) and one thing that doesn't translate to the ice cream machine is how easy it is to empty the oil, throw in polish, refill, empty, refill. You can't really have an automated process which drains out the ice-cream and then sterilizes it.
> To my knowledge, none of these systems have weird DMCA-protected firmware to prevent unauthorised maintenance.
Absolutely agree. The point of my post was more why a fry machine might have easier (and hence cheaper) maintenance than an ice cream machine.
The grills used by McDonalds are a bit more complex than a flat hot surface. They cook both sides of the burger simultaneously using "clamshells" lined with a heat reflective material, which automatically raise using hydraulics on a timer. Perhaps not as complex as an ice cream machine, but definitely not your griddle at home.
Edit: likewise, the fry machine has a self-propelled hopper which splits the raw fries up into batches.
Oh sorry, I wasn't trying to say it wasn't a scam. Just explaining why ice cream machines would be harder to maintain/install than something like a grill and why there might be limited options on who to go with.
If they go down the right path right at the beginning, a bit of payoff in the right places in McDonalds (which, remember, can be just taking the right people out to a really nice dinner every so often), and it could be that one equipment supplier managed to go down a path that no other current supplier could ever hope to replicate because it really depends on some early decisions, and those suppliers no longer have any opportunity to make "early" decisions.
I think of McDonald's as being pretty savvy, having dominated for decades in a competitive domain with large volume and low margins. In violation of Hanlon's Razor, I'd bet the reason is more malice rather than stupidity. Or rather, the specific form of malice more precisely called short-sighted greed.
McDonald's probably has paperwork that shows "ice cream machine broke" doesn't really cost them anything in sales or return visits, so why work on fixing it?
If it was a critical product, they'd have multiple machines per store, just like the friers (often way more than is needed).
Is there no equivalent phenomenon when it comes to their grills, deep fryers, drive-thru comms systems, self-order kiosks, etc?