In an interview Friday with CNBC, McDonald’s CEO Chris Kempczinski said the Chicago-based quick service chain has had to temporarily close 50 of its nearly 14,000 U.S. restaurants as a result of the coronavirus pandemic.
He said most of the closed stores were shuttered because they were part of a building or facility that was also impacted by the outbreak. For example, a McDonald’s at Navy Pier in Chicago closed because the Windy City tourist destination will be closed through April 2.
“We're truly in extraordinary times right now,” the CEO said in his first televised interview with CNBC.
NRN previously reported that quick-service chains are better equipped to survive the pandemic as a majority of QSR revenue comes through the drive-thru. Kempczinski said that is the case for McDonald’s, adding that its global $5 billion delivery business is seeing a spike as restaurants across the U.S. move to off-premise operations.
“We are better set up than most to continue to operate in what is certainly a very trying time,” he said.
Since Sunday, thousands of restaurants across the U.S. have shut down dine-in operations as government officials urge consumers to use delivery, carryout and drive-thrus.
For McDonald's, investments in delivery, which launched through Uber Eats in 2017, are paying off. The brand has since expanded delivery by adding DoorDash and Grubhub.
Kempczinski said delivery is growing at about 20% and “through this crisis, we're seeing our delivery sales become even more pronounced."
In China, where 95% of the company’s restaurants are open, Kempczinski said delivery growth has sustanined post-crisis, which could be the trajectory for the U.S.
But first and foremost, the CEO said people need to work together to stop the virus through actions such as social distancing and working from home.
Once the U.S. can flatten the curve, he said businesses will see “not a V shaped recovery” but a “a gradual recovery.”
Earlier this week, McDonald's Corp. said it is "working with franchisees around the world in order to evaluate operational feasibility and support financial liquidity" including rent deferrals.
During the interview, Kempczinski expanded on that saying the company is working with franchisees and lenders to restructure loan payments and getting payment extensions from suppliers. It’s also offering rent deferrals, which typically are a percentage of sales. Other franchisors are also offering operators financial relief.
“We're all really chipping in and it's incredibly important for us to keep our franchisees viable and open through all of this so they can serve the community,” he said.
At the same time, franchisees are going above and beyond to help the communities they serve.
On Friday, McDonald's said some franchisees are providing free lunches to children dependent on free school lunch programs where school is closed. The company said other operators are providing free meals to healthcare workers and offering up their parking lots for blood drives.
"We will continue to support all our communities as we have done throughout our history, and we remain as dedicated as ever to empowering our system to be good neighbors," the company said in a statement released Friday.
McDonald’s, the third largest U.S. restaurant chain by units, has nearly 700 company-operated stores. The rest, more than 13,150 restaurants, are owned by franchisees.
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Update: This story has been updated to include a COVID-19 update from McDonald's Corp.
