After the announcement by American fast-food chain McDonald's and its competitor Burger King to close more than 800 branches each in Russia, it turned out that the situation is "not that simple." Following McDonald's announcement to close its nearly 450 branches in Russia, the Daily Mail reported that many McDonald's restaurants are still unexpectedly open in Russia. According to Yahoo News, McDonald's operates 847 restaurants in Russia; however, by the end of 2021, it had 132 locally licensed restaurants managed by three agencies. McDonald's has limited control over the operation of its licensed restaurants in Russia.
The licensing company "GiD LLC," which operates 25 restaurants, told TASS news agency that its locations in Siberia are operating as usual. The Daily Mail noted that some other McDonald's restaurants in Russia plan to remain open only until supplies run out.
Regarding the Burger King crisis, on Thursday, the parent company of Burger King stated that it could not close the 800 restaurants in Russia because its independent operator there "refused" to do so. The corporate giant indicated that to enforce its contracts with the franchise owner, Alexander Kolubov, it would need assistance from the Russian government, but “we know this is unlikely to happen anytime soon,” according to a message to employees from the company's international president, David Shear.
Shear's lengthy message highlights the numerous complexities that confuse some American fast-food brands as they attempt to cease operations in Russia following the war in Ukraine. It also reveals what could become a vulnerability in international licensing, which is how most American restaurant brands expand abroad through franchises, without the parent company's control.
