Day 248 - 13 May 96 - Page 46
1 in the UK, the figures, do you remember we looked at the
2 figures the other day and we were asking you about the
3 charitable stuff and you said that would be -- that was
4 included and then the local store marketing would be on top
5 of that; do you remember that?
6 A. Well, I remember talking about advertising expenditure,
7 percentage of sales, an amount of money like £47 million
8 with local store promotion becoming £52-53 million, yes.
9
10 Q. Yes, that was what I was talking about. Did that figure of
11 £52/£53 million include expenditure on ronald mcdonald
12 appearances, or is that separate?
13 A. Normally Ronald appearances, to my recollection, are
14 paid for by the individual restaurant receiving them; that
15 would go in their local store marketing expense area.
16
17 Q. OK.
18 A. So it is in there.
19
20 Q. That is probably in the five million?
21 A. It is in that five, yes.
22
23 Q. OK. That would include all appearances, not just the ones
24 in store but ones at events, at schools, at all the places
25 where ronald mcdonald appears?
26 A. I am struggling to give you a straight and clear answer
27 because we have operated several systems over the years.
28 There was a point in time when the Company was only company
29 owned restaurants. At that point in time all charitable
30 expenses were run through our Head Office moneys. They
31 were not in the advertising account. As we became
32 franchised and the numbers of franchisees grew, they began
33 to participate in the spending of moneys on these events.
34 Hence, at that time, it became something we took from the
35 advertising moneys. They all contributed. Every
36 restaurant contributed to the total. So it has been a
37 movable thing over years as the system altered and changed.
38
39 Q. But in terms of ronald mcdonald appearances, not charitable
40 things, but things like going to schools, the parties in
41 the restaurants, going to fetes and things like that, prior
42 to the franchising that would have been part of the
43 advertising as well?
44 A. Some would have been. Some would have been an
45 individual store's expense. If we used Ronald at some
46 corporate function that would have been a Head Office
47 expense and not in there at all. In the total of things it
48 would have been very tiny. But everything would not have
49 been in that one account, no.
50
51 Q. Right. When did the Company first have franchised stores?
52 A. Here, in the UK or in the world?
53
54 Q. In the UK.
55 A. 1986, I think.
56
57 Q. Right.
58 A. 1986.
59
60 Q. OK. ronald mcdonald is an important part of your brand
