McDonald's has been testing fresh, never-frozen beef patties at restaurants in Dallas.
Wall Street analysts have applauded the change, but some McDonald's franchisees say it's a food-safety disaster waiting to happen.
In a recent survey by Nomura, two dozen franchisees warned that introducing fresh beef patties nationwide would slow down service and expose the chain to new food contamination risks.
"I have major concerns over food safety and our lack of ability to serve a large number of customers quickly," one franchisee wrote.
Another wrote, "If we do not handle the meat perfectly there is the opportunity for bacterial invasion of our product."
One operator brought up the E. coli outbreak that affected 14 Chipotle restaurants across the country last fall, sending the chain's sales plunging by as much as 30%.
"An uncaring employee [could end up] doing something that puts the entire system at risk," the franchisee wrote. "We are the lightning rod. Chipotle will be a walk in the park if we have an incident."
McDonald's has long relied on an extensive network of suppliers who make, freeze, and ship beef patties to its more than 14,000 restaurants in the US.
Expanding the fresh beef test — which is currently limited to 14 restaurants in Dallas — would require big changes to its supply chain. The potential for foodborne illnesses is higher when uncooked meat is kept at a temperature above 40 degrees Fahrenheit, according to the USDA.
(Biz Carson/Business Insider)
At the restaurant level, it would be a "massive learning curve for our managers and crew," one franchisee wrote. "No doubt the biggest change in McDonald’s history. Would be a huge distraction from our 'turnaround.'"
In the same survey, many McDonald's franchisees also acknowledged that fresh beef would help improve the fast-food chain's public image.
"Faster cook times, juicier product, seared product versus stewed meat," one franchisee wrote.
Another said, "Many customers perceive unfrozen to be better for you. Perception is everything."
Twenty-seven domestic franchisees with approximately 199 stores participated in the Nomura survey, representing a small fraction of McDonald's 14,000 stores in the US.
McDonald's CEO Steve Easterbrook said last month that there isn't currently a large enough supply of fresh beef to expand the test nationally but that the company could start expanding it gradually region by region.
"Would that supply be there right now? No it wouldn't," Easterbrook said at a conference in New York. "It doesn't mean we shouldn't start to expand it. You can go region by region ... and develop it that way. We are pretty good at solving operational supply chain issues when we have a good idea."
He said a larger rollout wouldn't require any major new equipment or expenses for franchisees.
The company just has a few small issues to work out through the test, such as finding the best system for storage and handling of the beef to avoid any cross-contamination of the fresh, uncooked meat with other food items.
"We are trying to figure out the best way to segregate equipment like spatulas and scrapers for the grill," he said.
But if there's enough enthusiasm for the fresh beef patties among customers, a rapid rollout isn't out of the question.
"When there is a ground swell of enthusiasm and the operators are aligned behind it and the company is helping support that, suppliers have stepped up in an unbelievable way to deliver both the equipment and also the ingredients," Easterbrook said. "We have shown how quick we can move when we have a good idea."
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