Edmonton, Canada – In a bold move, McDonald’s announced its decision to repurchase all its Israeli restaurants due to a decline in sales following a boycott linked to the perceived support for Israel.
Criticism arose after McDonald’s Israeli franchise distributed thousands of free meals to Israeli soldiers, sparking outrage and protests across several countries, impacting sales.
The fast-food giant successfully negotiated a deal with franchisee Alonyal to take back 225 outlets, acknowledging the significant business downturn caused by the Israel-Hamas conflict earlier in the year.
Operating in Israel for over three decades, Alonyal, led by CEO Omri Padan, has been a vital part of McDonald’s presence in the region, employing thousands of individuals through the franchise system.
Originating from protests in Muslim-majority countries like Kuwait, Malaysia, and Pakistan, the boycott escalated globally following social media posts by the franchisee boasting about donations to Israeli Defense Forces and other entities during the conflict.
Despite McDonald’s assurance of commitment to the Israeli market, the boycott and misinformation surrounding the brand led to missed sales targets and financial setbacks, prompting the decision to repurchase the Israeli business.
McDonald’s CEO Chris Kempczinski expressed disappointment at the boycott, emphasizing the collaboration with independent owners operating most of their stores worldwide, including in the Middle East.
With the hope of restoring their reputation in the Middle East and achieving sales goals, McDonald’s aims to regain trust by handling the Israeli business directly and focusing on local operations and employees in the region.
As tensions persist in the Middle East, McDonald’s anticipates challenges in the affected markets while striving to overcome the aftermath of the conflict and rebuild relationships with customers and communities globally.