McDonald set to pull-out business from Russia

McDonald’s says it is pulling out of the Russian market for good, after that country’s invasion of neighbouring Ukraine has made doing business in the country “no longer tenable.”

Like many global companies, the Chicago-based fast-food chain announced it would temporarily close all of its restaurants in Russia in February, when Russian President Vladimir Putin launched his invasion. The move from McDonald’s was said to be temporary at the time, as extricating itself from 850 locations and 62,000 employees would be painful to do over the long run, and the chain was hopeful of finding solution that would be beneficial for all parties.

But according to Monday’s announcement, the company is closing up shop in the country for good.

“The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald’s values,” spokesperson Joseph Lapaille told CBC News in an emailed statement.

After the temporary closure was announced, McDonald’s was one of a few foreign chains to discover it didn’t have as much control over its restaurants in the country as it thought it did, as many locations owned by independent franchisors stayed open and continued to serve customers the same fare they always did.

Hundreds of fast-food restaurants remain open in Russia, despite global chains such as McDonald’s, Burger King and KFC announcing plans to suspend operations in the country over the Ukraine war.

These restaurants are likely owned by franchisees, making it difficult for companies to shut them down. 2:05
The company says it will seek to have a Russian buyer hire its employees and pay them until the sale closes, but the company did not identify who that potential buyer would be.

It did say that it plans to start removing golden arches and other symbols and signs with its name from the country immediately, so it’s unclear what will happen to the signage of the many McDonald’s-branded restaurants inside Russia.

The company’s locations in Ukraine are also temporarily closed, but all staff are being paid and the company says it plans to reopen there as soon as it can.