McDonald's to Refranchise 1,500 Restaurants The burger chain is making a big refranchising push in the next two years, primarily outside the U.S.

By Kate Taylor

Opinions expressed by Entrepreneur contributors are their own.

McDonald's has a plan to boost its slipping profits: refranchising.

The burger chain announced Wednesday plans to sell at least 1,500 company-owned restaurants to franchisees by the end of 2016. The restaurants affected will be primarily outside the United States, in the Asia/Pacific region, the Middle East, Africa and Europe.

The refranchising boost will reflect a more than 50 percent increase in refranchising activity compared with McDonald's prior three-year period.

Related: Fast-Food Breakfast Buzz Boosts Egg Whites' Prices

Currently, over 80 percent of McDonald's restaurants worldwide are franchised. However, international franchise activity lags behind the U.S. Refranchising 1,500 of the over 14,800 international McDonald's will represent a huge jump in this effort.

McDonald's has struggled recently to keep up with the competition. In April, the chain announced that first quarter profits came in at $1.2 billion – a 5.2 percent drop from 2013, and short of analysts' predictions.

Refranchising is a common way for franchises to boost net income. Earlier this year, Burger King finished a refranchising push that resulted in a 99 percent growth in income in 2013. Wendy's is also in the process of reducing corporate stores, in a refranchising effort that spans 415 restaurants.

Related: Midlife Crisis? Ronald McDonald Gets a Makeover, Joins Twitter

Kate Taylor

Reporter

Kate Taylor is a reporter at Business Insider. She was previously a reporter at Entrepreneur. Get in touch with tips and feedback on Twitter at @Kate_H_Taylor. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Leadership

7 Telltale Signs of a Weak Leader

Whether a bully or a people pleaser who can't tell hard truths, poor leadership takes many forms.

Business News

Fans of Costco's $1.50 Hot Dog Combo Are In for a Big Surprise

Costco CEO Ron Vachris announced a change that's coming soon to the company's food courts.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Business News

'Nobody Ever Gave Me Anything': More Boomers Say They're Not Transferring Wealth to Family Until They're Dead

A new survey from Charles Schwab found boomers are more hesitant to distribute their wealth than other generations.

Leadership

How a Mindfulness Practice Can Help You Beat Tech Overwhelm

This article explores how mindfulness can transform your tech choices, ensuring technology serves your business goals without adding unnecessary complexity.

Business News

Instagram Is Offering TikTok Creators Up to $50,000 Per Month For Exclusive Content

Leaked deals show that there are strict terms to receiving the money.