Why do fast food companies usually franchise their restaurants instead of operating the locations themselves?

Question

Why do fast food companies usually franchise their restaurants instead of operating the locations themselves?

In: 101

Answer 1

To add to what everyone else has said, I’ll add another wrinkle – McDonald’s owns the land their restaurants are on. On top of the money they make from franchise fees, they also make money by leasing the land. McDonald’s is one of the largest commercial real estate owners in the world.