Wednesday, April 30, 2014

The Burger King Story

On Monday night, RTL (the non-state-run channel)....ran a show that was a undercover operation on Burger King.  It's had a dynamic effect on public perception of Burger King around Germany.

The news guys put at least two guys into an operation run by a syndicate (not Burger King itself or private ownership).  The syndicate?  It's a German guy with a 'silent-partner'.  What is generally known via the show is that the silent-partner is a Russian, and the Euro investment money (I suspect he put up almost all the money and lets the German run the syndicate).....came out of Cyprus.

If Cyprus rings a's where bank failures occurred last year....because of an over abundance of Russian billionaires who showed up over the past decade and parked billions into the banking system.  The Cyprus banks tried promising a fair amount of profit margin on investments.....which was probably way beyond reality, and this was one of the dozen-odd problems which sunk the banking sector there.  It would appear this Russian got smart.....found this German with some bright idea of Burger King franchises.....and got promised a fair amount of profit via this deal.

So, the Wallraff investigative team from RTL walked in and applied for jobs....were accepted, and immediately found bad working conditions, unsanitary kitchens, and bad practices all the way around.
There are eighty of the BK operations that the syndicate runs here in Germany.

Clean-up around their BK franchises?  No hired cleaning crew for anything.....the BK employees do it all.  Then you noticed....some guys were ordered to stomp down the paper dumpster in the back.....doing so in their BK uniforms and kitchen shoes.....then walked right back into the place.  No clean up or nothing.

Folks were hired under remarkable conditions where the BK operation benefited greatly.  It was a designed system by some management team to ensure another couple percent of profit off each front.

Typically....BK is the cheapest franchise that you can buy into.  In the's fifty thousand dollars to get your own franchise.  Figure around $300,000 for the start-up costs, and maybe another $150,000 for start-up employee cost.  BK (the company) expects you to pay around 4.5 percent royalty fees each year (covering advertising), and you have to buy sodas, burgers, buns, etc.....from the Burger King vendor (no short cuts).

When the show wrapped up an hour really had doubts about food safety, and felt negative about the way that they run the operation.  Yesterday morning (roughly eighteen hours after the show).....Burger King Germany (the mother company) announced that they were disturbed by the show and will be conducting on-the-spot inspections.

Via Facebook and various social media players......a number of Germans came out and said they probably weren't going back to Burger King.  Some suggested that the RTL news team go back six months later in undercover status and see if things are the same.

I suspect BK Germany is a bit frustrated with the syndicate operation that got into the middle of this and they know that these guys are carving out a bigger profit for their silent-partner than the norm.  Maybe BK Germany will offer to buy the eighty franchise operations and just put the syndicate out of a potential mess.

As an American in Germany.....I'm not visiting fast food operations like McDonalds or Burger King as much as I did in the US.  Maybe because of better alternate food possibilities or just my taste in fast food is diminished over the last decade.  After watching the show.....I had a fair amount of worry over food safety.  Getting food poisoning over a stupid burger or ice something that you shouldn't have to worry about.

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