Dividends and Goodbye, golden arches: Russia rebrands all McDonald’s restaurants

Companies spend billions of dollars on branding and it works to some degree, how much is anyone’s guess but we all remember some ads. It is certain that even if the brand has more or less disappeared from the marketplace somebody remembers the slogan and sometimes the company behind it.

In an article from Reuters, some 30 years ago McDonald’s open its first franchise in Russia to long line ups and the world seemed a more peaceful place. Before the war before Ukraine and Russia there were over 850 McDonald’s in Russia and similar to the US they did good business. Then the war happened and similar to many companies McDonald’s decided to close down operations in Russia, although they have a 15 year option to come back to the country.

In the meantime, one of the hallmarks of McDonald’s is they choose very good locations to set up in business, the new owner has changed the store’s name to Vkusno & tochka – the phrase translates to tasty and that’s it. The slogan is “the name changes, love stays”

Siberian businessman Alexander Govor is the new owner of the business and although the store is similar by using the same equipment and food sources, the new company does not have the right to some of the colors of McDonald’s, can not use the golden arches, can not use any mention of McDonald’s, but it is similar and people were coming to the restaurants. The owner said most of the chain’s ingredients are sourced in Russia. Part of the deal with McDonald’s was those who wanted to work at the restaurant could be rehired. McDonald’s took a $1.4 billion write down from the sale.

Linking to dividend paying stocks, all of us believe the company we work for is special because we work for them. The reality is companies adapt with or without us, as an investor that is what you expect for a company to remain profitable for a long period of time. How the company adapts in crisis, is a good thing to know when you invest.

There are more questions than answers, till the next time – to raising questions.


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