Special Report

McDonald's to Spend Billions to Upgrade Restaurants

Douglas A. McIntyre

McDonald’s Corp. (NYSE: MCD) does not like its own restaurants anymore. It will spend billions of dollars to change thousands of them. And the effort is a community service to the extent that it will “impact” economies in several states by hundreds of millions of dollars.

The figure McDonald’s will invest totals $6 billion, and the money will be used to upgrade most of its U.S. stores. Many of its franchisees also will make investments as part of the $6 billion number. The work will be done this year and next. The effort is supposed to be completed by 2020.

McDonald’s spelled out the improvements in a press release, which most consumers will not be able to understand. The fast-food giant will:

Modernized dining rooms with globally and locally inspired décor, new furniture and refreshed exterior designs

Enhanced customer experience with digital self-order kiosks that make ordering and paying for a meal easier. Kiosks empower guests to browse the menu, find options and tailor their meal just the way they want.

Remodeled counters allow for new table service that offers guests the opportunity to relax while their food is being made

Bright and easy to read digital menu boards inside and at the drive through

New designated parking spots for curbside pick-up through mobile order and pay

Expanded McCafé counters and larger display cases

Maybe millions of customers complained about the way current locations are set up.

In terms of what the upgrades are worth state by state, the impact will be extensive. In California, for example, the impact will be $390 million, as it upgrades 550 restaurants. In Florida, it will be $186 million, due to upgrades of 240 restaurants. In total, McDonald’s described the effects in 16 states and the District of Columbia.

Will the upgrades bring in more customers or get those who show up to spend more? The $6 billion is a lot of money to find out.