By some accounts, McDonald’s franchisee Herb Washington was doing well. He owned as many as 27 stores at one point, and today maintains 14 locations. But there was something very wrong happening behind the scenes.
Washington claims in a lawsuit that racist policies and practices are to blame for why Black franchisees aren’t afforded the same opportunities to thrive as white owners!
Is he the only one with such a brazen accusation?
Not at all. Other Black owners claim they were pushed to buy stores in low income neighborhoods with high employee turnover rates, crime, and lower sales revenue, and received less financial assistance than that given to white franchisees in affluent areas.
In response, McDonald’s claims Washington’s troubles are a result of persistent mismanagement on his part – not a result of racial bias.
Still, Black owners DO struggle to access the same level of success as white stores.
The number of black McDonald's franchisees in the US has dropped from 377 to 186 since 1998, the lawsuit claims. It also says Black-owned restaurants average $700,000 less in sales annually than white-owned ones, reports the BBC.
Franchising is thought to be an easier approach to Black entrepreneurship, but as Washington’s lawsuit and other recent protests show, it’s not a silver bullet. We always have to remain on guard for racial bias in opportunistic business opportunities like this.