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McDonald’s outlines $6B restaurant update plan

Brand outlines major modernization investments

McDonald’s Corp. this week outlined which states will be getting modernized restaurants, which include new decor, self-order kiosks and curbside pickup locations.

The Chicago-based burger giant said the company and its franchisees will be investing $6 billion to modernize the restaurants by 2020.

“Continuing to reinvest in the brand and keep it relevant for customers today is what it's all about,” said Steve Easterbrook, McDonald’s CEO and president, in July’s second-quarter earnings call.

“It’s a competitive marketplace,” Easterbrook said.  We want to differentiate ourselves from the competition, and we believe we have some initiatives in place that will help broaden the gap between us and the others.”

On Tuesday, the company outlined how much it and its franchisees are spending in 16 states and the District of Columbia to refresh interiors and exteriors on existing units, remodel counters to allow for new table service, provide new digital menu boards inside and at the drive-thru, allow for designated parking spots for curbside pickup for those ordering and paying through the brand’s mobile app and expand the McCafé counters and display cases.

State-by-state investments, including the number of units and the total expenditures for the aspects of the new “Experience of the Future” McDonald’s include:

  • Arizona: 200 restaurants, $120 million
  • California: 550 restaurants, $390 million
  • Colorado: 140 restaurants, $111 million
  • Florida: 240 restaurants, $186 million
  • Georgia: 340 restaurants, $170 million
  • Illinois: 410 restaurants, $317 million
  • Indiana: 270 restaurants, $168 million
  • Massachusetts: 140 restaurants, 143 million
  • Maryland: 135 restaurants, $104 million
  • North Carolina: 430 restaurants, $214 million
  • New York: 360 restaurants, $320 million
  • Ohio: 380 restaurants, $251 million
  • Pennsylvania: 360 restaurants, $266 million
  • Texas: 840 restaurants, $448 million
  • Virginia: 250 restaurants, $163 million
  • Washington: 170 restaurants, $126 million
  • Washington, D.C.: 15 restaurants, $19 million

At the end of the second quarter, Easterbrook said McDonald’s had already converted 1,300 restaurants in the span of 90 days. The Experience of the Future program was launched in 2016, and the company has upgraded more than 5,000 restaurants, or a third of the U.S. total, to that design, he said.

“As we continue to invest in the brand, as you invest in quality and the properness of our food, you invest in the physical real estate, as you invest in technology, what you tend to do is broaden your customer base,” he said.

“I think really what we end up doing is appealing to a broader range of customers on more occasions, more often,” Easterbook added. “That's what it's all about.”

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

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