Biting into that crispy McDonald’s breakfast hashbrown, I wondered: how much money does McDonald’s make in a day? I’m sure I’m not the only person who has ever asked the question. So, is it possible to determine how much this fast-food giant rakes in per day?
Finding out the precise amount that McDonald’s makes per day isn’t difficult. In fact, the company releases a financial report to the public each year. And the figures provided make it easy to calculate the fast-food chain’s average daily income. You won’t be surprised to learn that this world-famous eatery’s average daily revenue is in the tens of millions.
Of course, everyone in the world knows the McDonald’s name and has likely eaten at least one burger from their menu. Founded in 1940 in San Bernardino, California, the restaurant chain has expanded exponentially over 80 years. In fact, there are currently more than 39,000 McDonald’s outlets across the globe.
Clearly, the company must be bringing a substantial amount of revenue each year. But what is the average amount of money McDonald’s makes each day? Let’s take a closer look.
How Much Revenue Does McDonald’s Make a Day?
McDonald’s 2021 Annual Report indicates that the company produced a total of $19,2 billion during the 2020 fiscal year. This includes revenue earned from both company-operated and franchised stores locally and internationally.
Studying the figures, one can determine that revenue brought in by franchised outlets accounted for 55% of the total annual revenue. This isn’t surprising, though, as 93% of the over 39,000 restaurants are franchisee-owned and run.
If we divide this total revenue figure over 365 days, we find that McDonald’s made approximately $52,6 million per day on average. But this is the company’s income before expenses. And is, therefore, not a true reflection of what the company has earned.
How Much Net Income does McDonald’s Make a Day?
Looking at the report again, we see that McDonald’s net income, after expenses were deducted, was $4,7 billion for the year. We’re referring to operating costs, non-operating expenses, general company expenses, and provision for income tax.
Therefore, if we split this amount over 365 days, the calculation shows that the company earned about $12,9 million per day. And this would be an average across all their local and international locations.
What are McDonald’s Primary Sources of Income?
As mentioned, 93% of McDonald’s 39000 odd stores are franchised restaurants. And we’ve seen from the McDonald’s 2021 Annual Report that 55% of the company’s revenue was derived from franchised stores.
This portion of the revenue comes from the franchisee’s fees paid to the company. And these fees include the franchise fee, rental fee, royalty fees, and marketing fees. The franchise fee is an initial once-off cost allowing the franchisee the rights to the brand name. And the rental fee would likely have to be paid monthly.
Royalty and marketing fees are typically a percentage of an outlet’s monthly net sales. And this could amount to approximately 10% in total combined.
Interestingly, it is said that McDonald’s aims to have 95% of all its stores franchised. The reason is that revenue from these outlets is more predictable. And the cost to run these stores is for the franchisee’s pocket, so it’s far less costly for the company.
The remaining 45% of their revenue is generated through the global company-owned and run restaurants.
Conclusion
We’ve determined that McDonald’s makes around $52,6 million on average in revenue per day. And that it brings in an average net income of roughly $12,9 million per day across all locations.
While these figures are lower than those achieved by the company in 2019 and 2018, it’s still awe-inspiring. No wonder Forbes considers McDonald’s the 10th most valuable brand globally.
