McDonald's is in the news with reports that the QSR giant is suggesting franchisees close their dining rooms. The brand is "monitoring the impact" of the COVID-19 Delta variant, but any guidance comes from the pandemic protocol enacted last year.
A lot of McDonald's watchers and investors in the stock (NYSE: MCD) grabbed hold of something CEO Chris Kempczinski said in the latest quarterly earnings call. During that call, he said Labor Day could be a big milestone for reopening dining rooms across the country.
"While the Delta variant has brought more stops and starts to the COVID story around the world, people are venturing out and establishing new routines. That includes a return to in-person dining. Today, about 70 percent of our dining rooms in the U.S. are open," said Kempczinski. "By Labor Day, barring resurgences, it will be nearly 100 percent."
"Barring resurgences," is a key phrase there, one that seems to have been lost in the latest flurry of news.
A company spokesperson said this is part of the COVID protocol McDonald's put in place in May 2020. The spokesperson said franchise owners make the decision whether to open or close their dining rooms and that is informed by local case counts, along with customer and employee sentiment.
"Since the start of the pandemic, we’ve worked closely with our franchisees to drive our value of putting the well-being of restaurant crew at the forefront of our decision making. In consultation with public health experts and Mayo Clinic, we’ve enhanced over 50 safety policies and procedures in restaurants," read a statement from McDonald's. "We’re monitoring the impact of the Delta variant closely and recently convened together with our franchisees to underscore existing safety protocols, reinforce our people first approach and provide updates on the rise in cases in the country."
Joe Erlinger, McDonald's U.S. president, told franchisees as much on a call, according to notes from a recent meeting shared by McDonald's.
"As much as we want to be done with COVID, we must accept that COVID isn’t done with us. The Delta variant is biting deeply into the country’s progress. For the first time since February, the U.S. is averaging more than 130,000 new cases a day," said Erlinger. "What’s different for us is that we have a much deeper sense of what actions make a difference for the safety of our restaurant teams and crew. That’s a position of strength, and the result of hard work and close collaboration."
Investors and McDonald's stock watchers are keyed up for information about what the Delta variant of COVID-19 will do, but this just marks the company doing what it can to flex to the volatility of the very much ongoing pandemic. Reports of the company telling franchisees how to think about closures, however, are not new developments.
The return to 100,000 daily COVID-19 hospitalizations, a grim milestone reported by the New York Times, is new. Time will tell where that number goes, but it's a stark reminder that the restaurant industry shouldn't throw away the pandemic playbook yet.
"We must operate our business from the same mindset we had during the peak," Erlinger told franchisees. "Our judicious focus on actions, checking in with our people, being proactive and highlighting safety remain critical."