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Wednesday, Apr 17, 2024

HAMBURGERS—SoCal’s Hamburger King

Jeff Schwartz Title: Manager, West Coast operations for McDonald’s Corp. Previously Los Angeles regional vice president, based in Woodland Hills Age: 47 Most admired person: My father, Don Career turning point: Becoming a regional manager in Arizona Favorite burger: McDonald’s double cheeseburger Personal: Married, two children McDonald’s is the only employer its West Coast manager has ever had These days it is hard to find a senior-level executive at a $14 billion company who can say he or she is with the only employer they have ever known. But Jeff Schwartz’s career with McDonald’s began in 1969 when, at the age of 15, he took a job at a McDonald’s restaurant in Minneapolis. Since 1996, Schwartz has been Los Angeles regional vice president for McDonald’s Corp., overseeing 380 stores and roughly 17,000 employees from regional headquarters in Woodland Hills. Schwartz previously served as regional vice president in Phoenix for six years, and before that, as director of operations in Minneapolis. Schwartz’s Los Angeles region, one of 38 such divisions company-wide, includes all of Southern California west of the 605 Freeway from the Mexican border north to Paso Robles. Over the last decade McDonald’s has relied on special promotions, many catering to specific ethnic markets, and cost-saver deals for the consumer, such as 29-cent hamburger days, to hold its position as the largest food service retailer in the world. The company now has 29,000 McDonald’s restaurants up and running, serving roughly 45 million people a day in 121 countries across the globe. Schwartz said the company has worked to beef up sales here and abroad through the addition of those added promotions and programs aimed at streamlining operations and making service more efficient. McDonald’s has reported flat revenues for the last three quarters, the byproduct of a slow economy, but also because of recent threats from the spread of Mad Cow disease in Great Britain and staunch opposition to store expansion in some European cities. He was recently promoted to the position of restaurant support officer for the Western Region and moved last week to corporate offices in Irvine. Prior to his departure for Orange County, Schwartz spoke to Business Journal reporter Jacqueline Fox about the company’s strategies, where store growth here in the Valley stands and his plans for his new position. Question: Of the 380 stores in your region, how many McDonald’s stores are in the San Fernando Valley proper, and how do their sales compare to the region overall? Answer: There are 43 stores in the San Fernando Valley, which includes Glendale and Burbank, and sales here are very strong. Of those, about 20 are company-owned and the rest are franchises. We see the Valley typically exceeding what the average region does in sales per quarter, about 10 percent, so we feel there is a tremendously strong market here. Q: How many new franchises have opened up in the region since you came to Los Angeles, and how many are planned over the next five years, specifically in the Valley? A: We’ve added approximately 50 stores in the region over the last five years, and in the Valley we’ve put in 10. But we think there should be more here in the Valley. There is great opportunity here for growth and we think that’s in part due to the fact that we are underdeveloped here. I’m not sure of the number of stores that we plan for the Valley, but we are very bullish here and we currently have new franchise land agreements in the works. Q: McDonald’s is pushing a Latin-influenced menu in Florida and testing a McCafe gourmet coffee house and McTreat dessert shop in the Midwest. What concepts have been introduced here under your leadership and have they been successful? A: We introduced the Big and Tasty lettuce and tomato sandwich here about four years ago and it was wildly popular, so we will continue to promote that product at different times of the year. A couple of years ago we sent executives to Mexico City to see how the McDonald’s menus there were working, and then we later developed our own “Fiesta Menu” which caters to our Latin market. We ran that promotion for about three months and it’s also been very popular. We’ve kept the chorizo breakfast burrito on the menu permanently because sales for it were so strong. Q: Do you think Southern Californians want new items? A: Absolutely. The promotions we’ve introduced here are highly popular, and particularly so here in the Valley. We’ve seen tremendous response to specialty items and to what we call our “outrageous value” promotion, where we offer items like the 29-cent hamburgers. While our traditional items, like the Quarter Pounder and the Big Mac, remain very popular, we are constantly listening to our consumers about what they want and where they would like change. So we are aware of the need to offer variety. Q: Sales for the company overall are said to have remained relatively flat over the last few quarters, particularly in Europe where there has been a threat to the industry with the spread of Mad Cow disease. What’s been done to turn that around? A: Our strategy focuses on three different things: value, food and service. We’ve just implemented our “Made for You” cooking line at all operations, which is focused on providing fresher products. We’ve used new technology to produce every sandwich one at a time, as opposed to making several ahead of time in large batches. So our food scores are up dramatically. We also have launched a 30-second drive-through promotion in certain areas here in the United States, which offers a free Big Mac if your meal isn’t ready in 30 seconds. So, with a focus on improving quality and service, while coming up with value-targeted promotions, we think we are doing all the right things. Q: How many Big Macs did you have to give away under the drive-through promotion? A: Plenty. But the point is we try. We consistently look for ways to let our customers know we are listening. Q: How many regions will you be taking on as restaurant support officer and how many stores and employees will that include? A: My new territory will include nine regions on the West Coast and Hawaii. (That includes roughly 24,500 stores and about 140,000 employees.) Q: What will your goals be in your new post? A: I think, frankly, my top goal will be to simply do my best to implement programs that represent the success we’ve had in Los Angeles as a whole. My entire mantra is “I want to be a great employer,” so I’m very big on role modeling and providing the kind of example I want all of our managers to take on.

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