Like most great American companies, such as Budweiser, 7-Eleven, and even the Indiana Toll Road, Burger King is about as un-American as it gets.
Yes, it was born in the US, but now the franchise's biggest owner is a multi-billion dollar investment firm in Brazil.
I first became interested in Burger King's ownership after eating there not long ago and discovering the food was total garbage. Like, more garbage than usual. But it wasn't just the food, customer service had also gone downhill. I called their 1-800 number, and instead of asking what I ordered, or what the problem was, the representative sounded robotic, scripted, and only really wanted to know my address, so he could mail me a Whopper coupon and move on to the next asshole.
I was intrigued. I mean, most restaurants at least pretend to care, but Burger King seems to have taken the road less traveled.
So, I decided to look behind the scenes... to pull back the curtain... and here's what I discovered...
— 3G Capital, a Brazilian firm, put up 1.2 billion in cash for Burger King.
— It then sold 30 percent, a move aimed at getting the chain re-listed on the stock market.
— The new CEO is in his early thirties.
— In fact, most upper-level management were replaced with Wall Street kiddos.
— Burger King has since engaged in controversial, extreme cost-cutting measures.
It reduced its number of self-owned restaurants to 52, selling them to franchisees, and decreasing corporate head-count from 38,800 to 2400. In contrast, McDonald's still owns 19 percent of its stores.
It made some pragmatic decisions, such as selling the corporate jet, as well as its large executive offices, but came across as "cheap" when it asked office workers to turn in their personal printers, and use VoIP instead of making long-distance calls.
In addition, on the restaurant end, both ingredients and personnel were reduced.
— Looking back, selling 1200 stores was perhaps Burger King's most profitable, and unusual, decision.
This tactic allowed them to push all costs involved in repairing and improving old restaurants onto the new franchise owners, saving millions. But in doing so, Burger King distanced itself from the core business. It has 52 stores to test new products, whereas its competitors have thousands.
— Burger King is now worth 11.2 billion.
tl;dr: the food is garbage, but Burger King made a fortune using extreme cost-cutting tactics, both on the restaurant end, and on a much larger corporate scale. Now, it's a cash cow. But it remains to be seen if this overwhelming focus on the bottom line will be good for the brand in the long run. I doubt I'll eat there again-- on the other hand, with this kind of success, other large franchises might follow suit, which could be something worth investing in.