Food & Beverage

McDonald's serves up a new franchise plan

Luke Sharrett | Bloomberg | Getty Images

You want franchises with that?

McDonald's announced Monday a massive corporate restructuring aimed at reorganizing and righting the struggling business. The changes come as the 60-year-old burger chain struggles to regain ground lost recently to healthier eating and the rise of "fast casual" restaurants.

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As part of the new strategy, McDonald's will rely more heavily on its army of franchisees, who in 2014 owned nearly 30,000 of the chain's 36,000 restaurants around the world, the latest figures available. As part of the plan, only 10 percent of the brand's stores will be company-owned by the end of 2017, down from about 19 percent in 2014.

The margins on McDonald's company-operated stores were less than half the margins on stores operated by franchisees last year. Some of McDonald's rivals have been pushing franchises over company stores for years.

Burger King owned only 52 of its own stores in 2013, less than half a percent of the brand's 13,667 branches. That's down from 12 percent company ownership in 2007.

And Wendy's has sold off more than 400 company-owned restaurants in the last two years. Franchises now make up 85 percent of the company's establishments, and it plans to increase that to 95 percent by 2016.

The last time McDonalds significantly reduced its share of company-owned restaurants was in 2006. The restructuring plan will contribute to an overall annual savings of $300 million, according to McDonald's CEO Steve Easterbrook.