Professor Elam

The passing of Wendy’s founder Dave Thomas in 2002 has left the firm looking for a buyer.   You can check out the
Wendy’s website.

What’s wrong here?  Well the firm is profitable but gee the fast food field is crowded.  Burger King, MCD, Whataburger, Wendy’s, Jack in the Box, and now the rise of Subway, what’s a firm to do.  How would you use your study of accounting and finance to analyze the value of Burger King?  Perhaps we should start with the  Cash Flow Statement.    Click on the hyperlink, do you see a problem?  Hmm, cash flow is down significantly.  Now how about comparing that to its rivals?  Then we might see why it is for sale.  Economics textbooks tell us that small business lives and dies with its owner. Dave Thomas started the chain and revived it a couple of times.   Wendy’s had a big setback in the 1980s when they left some towns altogether, Same thing happened in the late 1990s, and so here we are again.  Not long ago, MCD had to redo itself. In fact i noticed that MCD now has corporate statements of responsibility in the restaurants. It also is running ads about how a Karen King  rose to the to from an entry level position.  This is an effort to dispel the notion that there is no upward mobility. 

At any rate, this is another example of how quickly fortunes can change for a company.  Focusing on Total Quality Management is paramount.