‘Working at Mcdonald’s is not a dead-end job. That irritates me’
Mcdonald’s is a restaurant reborn, its UK chief executive tells Bradley Gerrard, with a drive to be fresher and faster than ever
‘See,” Paul Pomroy points in an exacerbated manner, “we do have real ones”. Standing next to a stack of British Lion stamped eggs in the kitchen of the revamped St Paul’s branch of Mcdonald’s, the UK boss is on a mission to dispel culturally pervasive myths about the fast-food giant.
Mcdonald’s has developed a reputation for being an impervious and secretive corporate machine that hits back hard at detractors, including through the courts. It’s a long way from the liberal California where the Golden Arches began serving burgers in 1940.
A period of disconnection and a barrage of competition from new brands such as Five Guys and Shake Shack triggered one of the worst years in its history in 2014, when annual net income dropped 15pc to $4.7bn (£3.5bn) after serving a million fewer customers globally.
Crisply dressed in a vivid blue suit and trendy glasses, Pomroy looks like a man with a message that he is determined to serve up along with Steve Easterbrook, a fellow Briton who sits atop the US parent.
“We used to spend so much energy moaning about people not understanding us and we hunkered down, taking shots without explaining what we did,” recalls Pomroy, who first joined the company in 1996. “We did not allow people in as we were nervous to open up and concerned about how people would tell the story. We had some fairly tough stories and we made some mistakes taking on battles we shouldn’t have.”
One of these, Pomroy concedes, was the case that became known as “Mclibel”, where the fast-food chain took members of Greenpeace to court in London in what remains, at 10 years, the country’s longest running defamation case.
Even though the ruling in 1997 went in its favour because only parts of the activist group’s leaflets were true, it lost in the court of public opinion.
“What we have now is an ongoing desire to open up and explain who we are and what the brand stands for,” Pomroy claims. This new but unlikely era of transparency coincides with Mcdonald’s recent recovery. Last year, global earnings increased 10pc to $5.4bn. The UK division has posted 48 straight quarters of rising revenues and customers. The chain now controls 10pc of the £40bn fast-food market.
It doesn’t formally break out UK earnings, but accounts at Companies House show pre-tax profits steadily climbing from £39.9m in 2007 to £287m in the decade up to 2016.
Beyond eggs, the “step-change in the way people perceive us” extends into its menu, jobs and environmental credentials. Perhaps most pressing is the so-called “Mcjob”. The chain endured its second employee strike last week, with protests outside four of its restaurants.
The company claims just three people who were scheduled to work took industrial action out of its 120,000-strong workforce and that attendees in Cambridge and Crayford, Kent, were protesters and not employees.
Pomroy stresses that staff pay rates have been hiked by a quarter in the past three years – roughly the period that he has been in charge.
He says Mcdonald’s was paying above the minimum wage when the new, higher national living wage for those aged 25 and up was introduced.
“We took that as an opportunity to review our strategy,” he says.
“Every time the national living wage goes up we apply that to the minimum wage earners. It went up 7pc last year, which was 40p, and so we added 40p to the minimum wage earners.”
The chain continues to offer zero-hours contracts but, again, Pomroy insists this is not forced on anyone and staff can be, and are, on fixed-hours contracts.
“The contracts that get talked about [in the press] we don’t recognise,” he says. “We never leave our crew waiting for hours or cut hours at the last minute.
“The contracts are not exclusive and you get great long-term benefits after two years, such as private healthcare, a free food allowance and discounts on websites.”
He cites their usage as simply reflective of the way many people want to work, including grandparents who want the flexibility at work so they can look after young family members or students at home.
“We’ve also got people like a manager in Braintree whose daughter is a top ice skater and she needs flexibility to take her to competitions,” he says. “It’s a myth that people want 30 hours a week – it’s wrong and it does not exist.”
The firm surveyed its staff and says 80pc opted to stay on zero-hours contracts. This flexibility may explain why the chain has been able to create 5,000 posts in the past 18 months.
A job at Mcdonald’s is still frequently derided as “flipping burgers”, Pomroy bristles. “There’s a perception it’s a dead end job. I won’t swear, but that really irritates me.
“It is one of the best first jobs you can get. Half the franchisees started in restaurants and a third of the executive team did too.”
And Mcdonald’s is not about to stop hiring now. Pomroy will shortly be on the hunt for a further 1,000 managers to help it fulfil the ambition of opening 25-30 mainly “drive-thru” restaurants a year.
Managers are becoming more important to the chain as it overhauls the “eating experience” within its restaurants. Franchisees have splurged £650m on store revamps, including self-order machines and modernised decor, substituting the Ronald Mcdonald colour scheme of years gone by for a soft wood effect. Table service now means customers no longer even have to go to the counter to order. In the St Paul’s restaurant, 80pc of the customers now enter and order on a machine, with many also selecting table service.
The decision to invest at a time when rivals are being forced to launch dramatic rescue plans just to stay afloat is no accident. Before joining Mcdonald’s, Pomroy spent four years as an accountant within Smith & Williamson’s insolvency team.
This experience, and his training prior to it, took place during the recession in the early Nineties when consumers, much like now, were feeling the pinch.
“I saw how important it was to make sure cash was flowing through a business to the supply chain and to the grassroots,” he recalls. “Also, the businesses that survived the recession were the ones that invested. Those that did not adapt quickly enough to change fell away. I went through some really tough times making people redundant but if I treated them fairly they generally understood.”
Now Pomroy is staying true to what
he witnessed all those years ago. The latest battleground is in the delivery market, and Mcdonald’s is sacrificing margins to compete with its rivals in this field.
“We took the bold decision not to increase our menu prices on delivery items,” he says proudly.
“If you look at other brands, they say there is a delivery charge but the menu prices are higher [than inside the restaurant] too.”
It began a delivery service via Uber Eats in June and now offers food ferried from 275 stores.
“We’ve just broken through £50m of sales on delivery since we started and it is already 10pc of restaurant volume,” he says.
In the coming weeks, a total of 440 restaurants will offer delivery with plans to hike this to 800 “as quickly as we can”.
Pomroy describes himself as impatient – he plans to test other ideas in a select number of restaurants to establish whether they work.
One of these plans involves splashing out on some £10,000 on coffee machines.
In the UK, Mcdonald’s sells more coffee than anyone else, apart from Costa, but it is keen to dispel another myth: that it doesn’t use fresh beans.
Pomroy hopes that trained baristas preparing coffees in front of the customers will grind this perception away.
The married father of two sons grew up in Bromley, the town where he did his restaurant training when he first joined Mcdonald’s. Back then, the chain was a lightning rod for criticism about its contribution to the Western world’s increasingly poor diet, brought all too visually to life by Morgan Spurlock, the documentary maker, in his 2004 film Super Size Me.
But now, Pomroy says huge efforts are put into making Mcdonald’s food the best it can be. He says the chain and its suppliers – some of whom it has worked with for more than 40 years – meet monthly to try to improve the nutritional value of its output.
“We’ve reduced as much sugar from our buns as we can,” he claims. “If we took any more out it would just be an anaemic bit of toast. We can’t take any more out until food technology has moved on and there is a better technique of making them.”
Its burgers are 80pc beef and 20pc fat, the latter amount necessary or “the burgers would fall apart”.
Pomroy has even turned to online forum Mumsnet to help develop and spread the word about its low-calorie options.
Add to that its Rspca-approved pork and the fact that its distribution firm, Martin Brower, powers its fleet of trucks entirely on biodiesel (40pc of which comes from used Mcdonald’s cooking oil), Pomroy is full of reasons why Mcdonald’s is a new beast now.
“The one thing I’m proud of is that we’re not embarrassed about anything we do,” he proclaims.
“We want people to understand the facts first. You can still make a judgment but what really irritates me is making a judgment without the facts.
“Some things are not facts and some things are legacy.”
‘You get great long-term benefits, such as private healthcare, free food and discounts on websites’
‘It is one of the best first jobs you can get. Half the franchisees started in restaurants’
Paul Pomroy, Mcdonald’s UK chief executive, has overseen a revamp of its restaurants and a switch to self-order machines