Day 066 - 14 Dec 94 - Page 18


     
     1        people to make -- to meet our standards and product
     2        specifications, policies and procedures.  Then we go to a
     3        great extent in providing that.
     4
     5   Q.   In the United States we know that a majority of the
     6        restaurants, I think it is something around 80 per cent,
     7        are franchised; is that right?
     8        A.  That is correct.
     9
    10   Q.   Something like that?
    11        A.  Around 70.
    12
    13   Q.   Sorry, my fault, around 70.  Anyhow, it is quite a big
    14        majority of the restaurants?
    15        A.  That is correct.
    16
    17   Q.   How does McDonald's ensure that the franchisees do not fall
    18        down on their food safety procedures?
    19        A.  We have -- you expressed before the operations in a
    20        store.  Those operations have been verified that they
    21        produce a quality product, a safe product.  Our major
    22        emphasis in the prevention, so we start way back as far as
    23        we can in the supply chain.  We focus our attention at the
    24        restaurants in our operations on our hygiene and procedures
    25        and it is part of our agreement with our licences that they
    26        will provide and they are capable of delivering a safe
    27        product.  If the restaurant does not meet our
    28        specifications, our requirements, we work with them until
    29        they meet it.  If they do not, that is reason for
    30        cancelling our relationship with them, terminating our
    31        relationship with them.
    32
    33   Q.   What would happen with the manager of a company restaurant
    34        who, as it were, did not pull his socks up?  The place was
    35        still dirty or after a visit or whatever it was, what would
    36        happen to him?
    37        A.  Of course, the first thing is we would work with him.
    38        If we cannot and if he continues to not be meeting our
    39        specs., he will be terminated.  If he is -- and I can
    40        probably quote you the statement of our chief executive
    41        officer said in a partners' meeting where we had all of our
    42        licensees, all of our joint venture partners around the
    43        world, he said:   "If there is an outbreak of a food-borne
    44        disease in your restaurant, you will have people that will
    45        sue you, including McDonald's people, for loss of sales and
    46        we, as a corporation, will support that".  That gives you
    47        an indication of our commitment to food safety.
    48
    49   Q.   Who are the actual people on behalf of McDonald's who visit
    50        the restaurants to ensure that the proper standards are 
    51        being maintained? 
    52        A.  We have a field, what we call "field consultants"; we 
    53        have supervisors; we have suppliers and we have operations,
    54        we call operations people; we have quality assurance people
    55        that will visit restaurants and evaluate the restaurants
    56        and they will evaluate everything in a restaurant,
    57        including food safety, hygiene, cleanliness.
    58
    59   Q.   Is that system in operation around the world?
    60        A.  Yes, and we are well known for that system actually

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