Is Another McDonald's in Elk Grove The Key to Our Economic Development?

July 16, 2013 | Although it has been several months since the controversial McDonald's proposed on Sheldon Road and East Stockton B...

July 16, 2013 |

Although it has been several months since the controversial McDonald's proposed on Sheldon Road and East Stockton Blvd. has been before either the the Elk Grove Planning Commission or City Council, it is bound to surface at some point.

While the controversy regarding the proposed fast food outlet and gas station centered primarily on the developer's and McDonald's lust to circumvent current regulations and get an offsite billboard placed on Highway 99, there was also the question of just how many more McDonald's or other fast food outlets are needed in Elk Grove.

By our informal count, there are approximately 24 drive-thru fast food outlets in Elk Grove. For our purpose we did not include fast food outlets such as Subway, Habit Burger, Smash Burgers or pizzerias that do not have drive-thru service, or fast beverage places such as Starbucks (several of which have drive-thru's) or Peet's.

View Elk Grove Fast Food Elk Grove's Real Destination!- in a larger map

If you click on the map you will see most of our high density neighborhoods have quick and easy fast food access.

Getting back to the proposed Sheldon Road McDonald's, you may ask what difference does one more fast food joint in what is already an over-saturated market make? Aside from the obvious negative health implications for a culture suffering from a crack-like addiction to fast food, there is a website recently launched that ought to grab the attention of the Elk Grove City Council.

McDonald's, in a joint public relations effort with Visa, has launched a website called Practical Money Skills to help it's employees budget their wages. A review of one of the worksheets has an entry line for a second job income.

Clearly McDonald's has acknowledged that an average restaurant worker in one of their 38,000-plus outlets can't make a living without a second job. Of course this is not surprising or unique to just McDonald's, but as the world's largest fast food purveyor, they set standards for the whole industry.

During the several continuous meetings regarding this development, developer Gil Moore and McDonald's representative Susan Green have touted this combination fast food gas station outlet as important part of Elk Grove's economic efforts. Not surprisingly, perhaps because of the some well-placed campaign contributions, some council members seemingly signaled their support for the project based on economic development basis.

Our crystal ball does tell us how this matter will end, but we just hope that should the Elk Grove City Council unwisely change the zoning on this parcel and allow not only the restaurant and their highway billboard, they don't insult our intelligence and do it on economic development grounds.

The only economic development benefit will be to McDonald's and the developer, certainly not the hard-working employees as McDonald's has freely acknowledged.

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Anonymous said...

Another McDonald's or alcohol license to Wal-Mart and maybe another hospital on Elk Grove Blvd. are key to Gary Davis getting elected again. Soon Elk Grove will be riddled with crime, over crowding, and traffic congestion due lining the pockets of want to be politicians.

Thomas A. Anderson said...

Perhaps Moore and McDonald's can get the American Heart Association to speak on behalf of McDonald's. Worked for Wal Mart.

Anonymous said...

Campaign contributions Gary Davis-
Howard Research & Development Corp. - Chicago Il
Brookhurst Development – Newport Beach, CA
Vintara Holdings, LLC. – Roseville, CA
The list goes on and on of developers donating to Gary Davis and we will continue to see these corporations taking over this small town just to keep someone in office.
You want McDonald's on every corner? Keep Davis in or ask him to build Elk Grove responsibly.

Medical Mecca said...

The fact that the city leaders are willing to change the zoning from high density residential to commercial tells us once again how the puppeteers come to town and easily hoodwink them into believing our plan is not correct for the Market nor economic development. Wonder where all these retail workers in Elk Grove are eventually gonna live? They all can't be living with mommy and daddy?

The fact that our prime real estate near the freeway is only good enough for a McDonald's and AM/PM mini mart tells us how the market perceives the demographics of Elk Grove--fast food eatin' simpletons who drive a lot. Guess we're not Folsom or Roseville and can't support a high-end steak house or other quality eatery?

The Market speaks once again and the puppet strings go flying.

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Anonymous said...

The leaders of Elk Grove puppets? Sounds about right considering most of their contributions come from interests other than that of the citizens of Elk Grove. You can catch a recorded session of the bobble heads as they agree to anything on the Elk Grove website. Over the next few days I will be posting the current leaders of Elk Grove top contributors and where they actually are coming from or should I say who really runs Elk Grove.

Elk Grove News said...

EGHS comments point out the advantage of using a registered name on Google, the host server of this site - the ability to remove your comments.

Anonymous said...

Destination City....FAST FOOD CENTRAL-Food Truck Feasts!

Connie said...

Here is my take on article. I think Elk Grove needs to at least take a reasoned look at what is right in front of us. The demographics are changing as we baby boomers step aside for our children who are now the adults and they are redefining the American Dream.

We can only look to the revitalization of Mid Town Sacramento. I know of an Elk Grove prominent business owner who sold his house in Galt and moved to Mid Town Sacramento because his family wanted to live in a walkable neighborhood surrounded by amenities. Studies have been done that young people are no longer rushing to live in the suburbs.

Have we done anything here is Elk Grove to reurbanize our city to attract young professionals? What is the sound plan to do that?

Access to amenities—including parks, transportation, restaurants, cultural facilities and sporting events—are making cities the preferred alternative to suburban living. That is going on all around us.

Let’s face the hard reality. Our city’s leaders, in our short life of 13 years, made the conscious decision that Elk Grove would be a bedroom city. That’s what we are and now a one of them wants to reinvent Elk Grove. Another said, “Rooftops, rooftops and more rooftops!”

So who do you think is going to win out here? As it is said, we only have to look at our city's past to get an indication of our future.

And it pains me to hear from the dais that our leaders believe that another McDonald’s is part of their plan for sound economic development.

We deserve better!

Anonymous said...

@Connie, Agree'd!

Downtown or mid-town Sacramento is a thriving community and will become an even broader area that attracts the young professionals with the new arena coming.
July 2012 Mayor Davis accepts contributions from McDonald's Franchisee. September 2012 Mayor Davis accepts contributions from California Apartment Association. There are several builders and developers in the pockets of all the members. Of course we know what happens if one of the members vote against a developers they will not get re-elected so they all keep their bobble heads on. These small town politicians have their own interest.

Anonymous said...

I rarely agree with Connie; but this time her thoughts are similar to mine. McDonalds does not make us unique or attractive as selling points. No imagination, no style, no WOW factor. I wish our council would strive for excellence instead of mediocrity. Saddens me to say, but Connie has hit the nail on the head.

Anonymous said...

Agree, just another small town dominated by corporations greed with blind politicians.

Anonymous said...

I never voted for Davis in any election.

Thomas A. Anderson said...

The die has been cast fellow Elk Grovians. We are at 98.2 percent of fulfilling the aspirations of developers and big businesses. Still a chance, very small at that, to save what little we have left but it will require breaking freeing of the current Smith's on the dais.

Lynn said...

All the comments above are true. Connie The Urban Land Institute has reported just what you have said. Just the other night the council elected to allow the second half of Whitelock to have above ground power lines....For all of us who comment here; time to get the forces out to council meetings! Most certainly I believe citizens and residents of Elk Grove should out number the developers at council meetings. Citizens and residents of Elk Grove; ATTEND the Council Meetings; it is only twice a month!

Anonymous said...

Lynn, Is it true that Mayor Gary Davis led the charge to keep the power poles overhead?

Anonymous said...

Davis does what he is told to do by the people that pay him and that's not us.

Lynn said...

I would not say that Mayor Davis led the charge. If anything vice mayor Detrick began the dialog about where the lines are in what exists and the expense it would take should the lines be placed over head and then it is decided to go underground. I encourage you to listen to the video for yourself and decide....what is said by the applicant and the conversation between council and staffs input regarding the bonds is very interesting and educational. It is item 9.5.
Maybe Elk Grove News can provide the link to the tape. Davis did comment there may be "higher priority infrastructure". I am thinking that the mortgage(bonds) for the area is maxed issue new bonds probably would need to evaluate the base sale price of the homes to be built....etc...etc...this might slow the process for the remaining build out...In any regard...I want to know what is the higher priority infrastructure?...maybe you know.

Elk Grove News said...

We will clip item 9.5 from last week's meeting and if we can load it to YouTube (based on YouTube size restrictions) will post here at the earliest possible time.

Anonymous said...

See if this works for anyone. Go to about 2:35:27 for the start of the presentation by Mr. Jordan.

Connie said...

Agree with me or not, it is nice we can have a dialogue that is constructive and hopefully we all learn a bit.

Some of us have asked the question about the oversaturation of McDonald’s franchises here in Elk Grove. Frankly, the ones on Elk Grove Blvd. and Laguna at Hwy.99 are doing very well without freeway monument signage.

In fact, when questioned at the council meeting, the McDonald’s representative said that the McDonald’s on Laguna Blvd. and Highway 99 is the most lucrative franchise in our city.

We haven’t had the question answered and that is, “What about McDonald’s retail oversaturation in Elk Grove?” Could another McDonald’s cannibalize all the others? We have seen this happen with Starbucks. “As we add more stores, we increase our total business, but we cannibalize our existing stores," Orin Smith, Starbucks' president, has been quoted as saying.

So I Googled and found an article on the very subject. A few excerpts are:

“The price that McDonald's paid for expanding its core customers was cannibalization of its existing stores.

"Rapid development on an already large store base hurts comparable sales at existing units, but increases total sales," said Dean Haskell, an analyst with Everen Securities in Chicago.

In other words, it's inevitable that if you add another store in an area where two already are prospering, the average sales at the existing stores will suffer.

For chains like McDonald's, where most of the retail ownership and operations are handled by franchisees - 79 percent of McDonald's U.S. stores are franchised - cannibalization doesn't hurt the corporation at first.

Individual franchisees suffer because their sales decline while customers go to nearby outlets. McDonald's, however, still collects royalties from franchisees based on the increasing overall revenue.

But as cannibalization continues, the investment in new stores outpaces the profits earned from increases in total sales.” [End of copy]

So by adding another McDonald’s aren't we just spreading the existing revenue; and therefore, no real economic benefit?

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