McDonald’s: How the Burger Giant Really Makes Billions

Golden arches, a quick stop at the McDrive, a bag that smells of fries, burgers sizzling on the grill. When people think of McDonald’s, they mostly think of affordable fast food. But while millions of customers visit the restaurants every day, there’s a completely different business operating in the background—one that has little to do with fries and softdrinks.

That’s because a huge portion of the company’s profits doesn’t come from selling burgers, but from a largely invisible business segment: real estate.

McDonald’s as a landlord

What many people don’t know: Over 90 % of McDonald’s locations are operated by franchisees. That means McDonald’s often owns the land and buildings and leases them—fully equipped—to franchisees. This way, the company earns not only franchise fees for the brand but, more significantly, rental income.
Each year, this brings in around 10 billion US dollars solely from leasing its locations. This clever business model makes McDonald’s not just a fast food giant but also an extremely profitable real estate company.

Profits beyond burger sales

While customers mainly think about food and drinks, a well-oiled system is running behind the scenes: McDonald’s leases out fully furnished restaurants to franchisees, who then take care of staffing and daily operations
It’s a model that works—high margins, stable income, and control over brand presence worldwide.

More real estate than restaurant?

Whether you call it clever entrepreneurship or a surprising business strategy—one thing is clear: McDonald’s earns far more from real estate than from burgers.

With each leased location, the company secures another piece of its success formula, makes itself more resilient to fluctuations in the fast food market, and solidifies its position as a multi-billion-dollar enterprise in the long term.

Photo by Joiarib Morales Uc via Unsplash