Trivia: Did You Know This Fast Food Chain Is Actually a Real Estate Company?

Although known for its French fries, burgers, wraps, and milkshakes, this fast food-selling giant is a real estate company

Making a business is tough. However, making a business on the basis of a peculiar strategy is even tougher. But if it works, it works. For this company, their strategy worked wonders and has become a case study in business schools. Known for its French fries, burgers, wraps, and milkshakes, this fast-food-selling giant is a real estate company.

A fast food giant

According to Investing, McDonald's, the fast food giant, sells nearly 6.5 million burgers daily. Therefore, to the masses, it is a fast food company.

Real estate

However, McDonald's is a real estate company because of its unique revenue model.

Lease plots and buildings

All McDonald's franchises are independently owned and are not operated by the fast food giant. Instead, it leases the plots and buildings where one is allowed to run a franchise.

Revenue from rent

Therefore, the owner of a franchise pays hefty rent to McDonald's for the plot or building where the franchise is operated. In short, McDonald's primary revenue comes from rent.

Secondary source

Apart from rent, McDonald's makes a small profit from fast food sales. This is why McDonald's remains profitable even if the customer return rate dips. After all, the monthly or yearly rent remains the same even if the footfall of eaters goes down across the franchises.