Apr 6, 2024

Behind the McDonald's boycott controversy

EPA. The sudden decision by McDonald's to take over ownership of its branches in Israel has thrust the franchise company Alonyal and its chief executive Omri Padan into the spotlight. McDonald's will buy back all of its Israeli restaurants after global sales slumped due to a boycott of the brand over its perceived support for Israel in its war against Hamas in Gaza.The fast-food giant uses a franchise system which means that individual operators are licensed to run outlets and employ staff. At the time, the firm said the decision had not been co-ordinated with McDonald's headquarters in the US.Israel has built about 160 settlements housing some 700,000 Jews since it occupied the West Bank and East Jerusalem - land the Palestinians want as part of a future state - in the 1967 Middle East war. They might be pleased though, about the effect the boycott has had.Mr Padan's departure comes after McDonald's said that the Israel-Gaza conflict had "Meaningfully impacted" performance in some overseas markets in the fourth quarter of 2023.For the unit that includes the Middle East, China and India, sales growth stood at 0.7% in the fourth quarter of 2023 - far below market expectations. McDonald's to buy back Israeli stores after boycott.

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