QSR Franchisee Profits Collapse as Beef, Labor and Value Wars Crush Wendy's, BK, McDonald's
Franchisee economics are unraveling across the big three burger chains. Wendy's Q4 2025 SSS fell 11.3% with US company margins down 340bps to 11.4%. BK franchisee cashflow slid to $185K from $205K as beef costs jumped 20%. McDonald's Q1 margins dropped 25%, prompting a rethink of its franchisee-versus-company ownership mix.
QSR franchisee profitability is collapsing across Wendy's, Burger King and McDonald's as record beef prices, labor, delivery fees and aggressive value discounting crush margins, prompting McDonald's to reconsider its franchisee-versus-company ownership balance.