McDonald’s and Carrefour Celebrate Consumer Rights Day With a Food Scandal

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It’s customary on Consumer Rights Day for Chinese media outlets to do some investigative journalism. The best-case scenario is a dramatic, 60 Minutes-style spotlight of a famous foreign company in violation of some regulation or another, preferably in flagrante delicto with cameras rolling. Oh, the fun. And given the veritable parade of food scandals that have rocked China over the past few years, anything involving food must be top priority for the media.

This year, China Central Television (CCTV) went after McDonald’s and Carrefour, and wouldn’t you know it, it turns out that these companies, which own, operate or otherwise license thousands of units, have some quality problems. No one could have predicted that.

Here’s the AP report:

Chinese state television has accused McDonald’s and French retrailer [sic] Carrefour of selling expired chicken products in separate incidents amid public anxiety in China over food safety.

McDonald’s Corp. and Carrefour Inc. issued public apologies Friday and said they were investigating the report by China Central Television.

The report Thursday said a McDonald’s restaurant in Beijing sold chicken wings 90 minutes after they were cooked while the company’s rules set a 30-minute limit. It said employees at a Carrefour store in the central city of Zhengzhou changed expiration dates on some chicken and sold regular chickens as more expensive free-range birds.

Oops. No excuse for these misdeeds, and they’re now having to apologize for this embarrassment. But it’s all part of growing up and being British being a foreign company in China.

By the way, I enjoyed the language of the preliminary statement from McDonald’s. See if you can spot the questionable logic:

“McDonald’s China attaches great importance to this. We will immediately investigate this isolated incident, resolutely deal with it earnestly and take concrete actions to apologize to consumers,” said a statement by the U.S.-based restaurant chain on its website.

Hmm. They will immediately investigate, meaning that the facts are not yet in. At the same time, they feel comfortable characterizing this as an “isolated incident.” PR 101, I guess. I’m not sure if Carrefour issued a similar statement, but if they did, I’m sure it would come off better in French.

This story is also a useful reminder of just how difficult franchising and retail can be. Think about it. You’ve got a McDonald’s unit that was serving chicken wings 60 minutes after the expiration of what sounds like a self-imposed deadline. Not only does McDonald’s have, I assume, a huge number of these rules unit management has to abide by, but area/regional/international management also has to worry not only about violations of franchise rules, but also of local law.

I don’t know about you, but if I was a franchisor, I wouldn’t get much sleep. Moreover, if I was a China franchisor, and I saw that Consumer Rights Day was coming up, I’d probably develop an ulcer or high blood pressure. (Well, for me, that would be redundant. Thanks to millenia of Jewish inbreeding, my DNA is teeming with deleterious recessive genes.)

Let’s also keep in mind that the alleged McDonald’s “expired meat” and that of Carrefour are very different things. It sounds like those chicken wings were perfectly edible and had just sat under a heat lamp for an extra hour. Maybe a bit too crunchy, but probably not a public health issue. Carrefour, on the other hand, was accused of mislabeling meat that may actually have been expired. The latter is a bona fide legal violation and public health issue.

On the bright side, Carrefour and McDonald’s are not facing the same scale of product quality problems that plagued Wal-Mart last year. If you recall the “green pork” scandal and Wal-Mart’s temporary closure of its Chongqing stores, you’ll realize that these things can be much, much worse. A isolated bit of mislabelling and some elderly chicken wings? As we franchise lawyers would say, 没有问题. I’m assuming, of course, that these problems are not the tip of the iceberg and that the quality issues can be fixed satisfactorily. No one wants the full Wal-Mart treatment.

Update: China Digital Times has a good summary of the news coverage of this story. It sounds like there was more going on at McDonald’s than just old chicken, so their actions and those of Carrefour might be comparable in terms of food expiration. The question remains how widespread these practices are.