McDonald’s renews 20-year franchise deal in the Philippines

McDonald’s has renewed its 20-year master franchise agreement in the Philippines, extending its partnership with Golden Arches Development Corporation (GADC) until 2045.

Under the new agreement, the company retains exclusive rights to own, develop, operate and sub-franchise McDonald’s restaurants nationwide.

GADC, led by founder and chairman George Yang, has operated the fast food giant’s Philippine business since opening the first McDonald’s store in 1981.

The chain operates 792 stores in the Philippines, with the majority in the National Capital Region.

Reflecting on the franchise’s early days, Yang recalled applying for the rights in the late 1970s.

“I confidently said 10 stores,” he continued. “This year, we’ll be opening our 800th store.”

McDonald’s Philippines has introduced several firsts to the local quick-service restaurant sector. It was the first in the country to launch an online delivery platform in 2009, followed by the McDelivery app in 2014.

The brand was also an early adopter of third-party delivery aggregators such as Grab and Foodpanda, where it is now one of the largest merchants.

Last year, McDelivery accounted for 19 per cent of the company’s total sales.

Kenneth Yang, GADC president and CEO, said digital transformation has played a key role in McDonald’s growth in the market.

“These platforms have helped scale the business and improved how we operate,” he said.

“We are not stopping here. Our teams constantly work on new opportunities driven by evolving customer preferences and behaviours.”

GADC is 51 percent owned by the Yang family, with the remaining 49 percent held by Alliance Global Group Inc, chaired by tycoon Andrew Tan.