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dangus10/02/20241 replyview on HN

As it pertains to the original query of this comment thread, whether this is a real business model, it doesn’t really matter that it’s not “a real restaurant,” what matters is whether it’s a viable business that makes money.

Mr. Beast burgers is not really that different than McDonald’s franchising if you really think about it. Most people don’t buy a McDonald’s burger based on who the franchise owner is and how they run their restaurant, they’re buying a McDonald’s burger because of the McDonald’s brand and product.

McDonald’s captures 80% of ~~revenue~~ net income and leaves only 20% to franchisees.

Essentially, the concept is the same: the business value and profit margins are owned by the brand and the laborious act of delivering the product locally is a thin-margin interchangeable “ghost kitchen.” Not only that, the power dynamic is one where the franchise dominates the franchisee. The physical kitchen, its owner, and its employees are replaceable, the nationally recognizable brand is not.

I would argue that ghost kitchens basically take the franchise concept to the logical 21st century conclusion: essentially, why bother doing all the expensive stuff that McDonald’s does with their franchises when your storefront is digital and anyone with a flat top, fryer, and a pulse can follow the directions to produce your fast food product?


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hollerith10/02/2024

>McDonald’s captures 80% of revenue and leaves only 20% to franchisees.

Most of the revenue goes to paying employees, real estate cost (rent or depreciation), energy cost and cost of ingredients. You mean, "captures 80% of the net income". Or profit.

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