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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (3499)	9/23/2004 7:30:36 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

I hope this will never come--"McDonald's awaits China's profit boost Bloomberg News Published September 23, 2004 McDonald's Corp. says it has received government approval to start franchising its fast-food restaurants in China, a change that will boost profit in the world's most populous nation. The world's largest restaurant chain now owns and runs all of its 595 outlets in China and plans to add as many as 120 a year, said Peter Tan, the head of McDonald's China business. Faced with a saturated market in the U.S., McDonald's is accelerating expansion in emerging markets such as China, where urban incomes rose 40 percent between 1999 and 2003. Franchising--which allows McDonald's to collect rent, royalties and trademark fees from restaurant operators--accounted for about two-thirds of McDonald's operating profit last year, earnings statements show. "China has been somewhat small for McDonald's," said James McGlynn, who helps manage $6 billion at Cincinnati-based Summit Investment Partners. "If it's made such progress in a huge market like China, that may prompt investors to look at them with fresh eyes." Tan said China's Commerce Ministry gave McDonald's verbal approval earlier this year to start franchising. He said the company expects formal approval by year-end. Zhang Lei, a Commerce Ministry spokeswoman, declined to comment. chicagotribune.com