Thing is... Not in Europe? I mean, European McDonald's is pretty solid, meat tastes fine since it has to be locally sourced, same with taters. But then I tried American McDonald's and uh, yikes
I guess it's the same across the US for the sake of logistics but then these brands make better products for European markets due to EU nutritional demands, legislation, etc. and their EU franchises produce higher quality stuff - so they could totally sell the same high quality products in the US and still make a profit... But why don't they?
Is it really worth cutting every little corner and serve the absolute bare minimum of acceptability?
I don't know how things are in European countries, but in the United States, the leadership of publically traded companies have a legal repsonsibility to maximize profits to shareholders - 'fiduciary responsiblity'. This has resulted in corporations that will, given the option, always choose profit over everything else; reputation, product safety, longevity, sustainability, it all gets burned at the stake of short-term profits.
It really got accelerated in the modern era thanks to consulting firms like McKinsey popping up and essentially encouraging this behavior as a way to maximize shareholder value in the short-term. To the point that, in the eyes of many shareholders (especially big conglomerates that manage average citizens' investments, mutual funds and retirement funds and the like), there is no value in anything other than pumping the value as high as possible so they can then sell the stock and buy elsewhere before the crash happens.
It's terrible and awful but makes people money so nothing will change.
They do have a fiduciary duty to shareholders but that doesn’t mean they have to always choose profit. They can easily say we aren’t going to make a shit product because we think a good product will make the business more durable. Or we are going to pay a little more than market because we want our pick of the best employees and want them to be bought in.
Just about the only thing they can’t do is say “we gave $400m away because we just felt like it, we have no plan for how we would recoup that”.
Most shareholders only care about quarterly profits. You don't get to invest for the future unless you're a unicorn startup. Then you get to bleed red for years while you take over the market. Amazon did that.
That’s just not the case for most companies. And that’s different from saying by law companies have to do that or they get sued. Most shareholders want a durable and long-lasting business.
Hatchet job private equity firms want to exfiltrate as much profit as they can from the company and don’t care about durability, sure I’m not saying that doesn’t happen. But the notion that by law you have to relentlessly pursue short-sighted profit, or that all shareholders force companies to maximize next quarter is way overstated.
I mean my god, just look at Take Two. How long did they let rockstar cook with GTAVI?
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u/apixelops 9h ago
Thing is... Not in Europe? I mean, European McDonald's is pretty solid, meat tastes fine since it has to be locally sourced, same with taters. But then I tried American McDonald's and uh, yikes
I guess it's the same across the US for the sake of logistics but then these brands make better products for European markets due to EU nutritional demands, legislation, etc. and their EU franchises produce higher quality stuff - so they could totally sell the same high quality products in the US and still make a profit... But why don't they?
Is it really worth cutting every little corner and serve the absolute bare minimum of acceptability?