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McDonald’s exiting Russia after 32 years is the end of an era

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Soviet customers wait in line at the newly opened McDonald’s Soviet Union in Moscow’s Pushkin Square on January 31, 1990.

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At 4 AM, a few Russians were already lining up in front of the building to escape the bitter winter cold. 

The doors were opened and hundreds of hungry and bundled up Muscovites raced in to get their first taste of the alien invention: the Big Mac. 

McDonalds had opened their first Soviet Union-based restaurant on January 1, 1990. This was the moment when McDonalds became the last Western company to penetrate the Iron Curtain.

Russians had been hungry at that point. Literally. In the literal sense. A meal at McDonald’s cost half a days’ wages, but “it’s unusual … and delicious,” one local woman told a CBC News reporter at the opening, after trying her first burger. 

She said, “We all are hungry in this town.” “We need more of these places – there is nothing in our stores or restaurants.” Due to high demand, McDonald’s had to remain open for several hours beyond its closing time. They also served over 500,000 customers. 30,000 customers on its opening day – a record for the iconic American chain.  

Russia, over the past 32 years, has evolved into a capitalist nation, home to thousands of Western brands as well as foreign investments. However, many of these companies have closed their doors in recent weeks, either temporarily or completely, following the invasion by Russia’s President Vladimir Putin of Ukraine. 

The 1990 scenes are almost the same, but in a different context. McDonald’s in Russia announced that it was closing 800 of its restaurants. The announcement came before Russia’s permanent exit. Long lines formed at McDonald’s as Russians waited in line to grab what may have been their last ever golden-arched hamburgers or fries.

One Russian man even handcuffed himself to the door of a Moscow McDonald’sIn protest, shout “Closing me down is an act hostile against me and other citizens!” before being arrested.

« Massive symbolic value»

Bakhti Nisanov, an Eurasia specialist and a Soviet Union native, is oddly moved by the news.

“It is truly strange how I feel. He said that it felt almost as if there was no hope for the country.

This has huge symbolic significance: McDonald’s’s arrival in Russia (then part of the Soviet Union) was an implicit signal that Russia was open to business. Nishanov explained that Russia has been evicted by the company. This is an indication of how unfriendly Russia is to business.

On March 11, 2022 people waited in long lines to get into a McDonald’s Moscow restaurant. This was after McDonald’s announced that it would temporarily close its 850 Russian restaurants. It joined other foreign brands who had been closing down operations in Russia due to the military conflict in Ukraine. Since then, McDonald’s has decided to leave Russia.

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Nishanov recalled how she read the first McDonald’s story in Russia, Yunniy Tehnik. The article was so fascinating and hypnotizing that I couldn’t help but be fascinated at the possibility of being a part the American culture McDonald’s represented.

“To a generation of Russians, McDonald’s — commonly referred to as MakDak — was a fascinating phenomenon,” he added. McDonald’s is clearly connected to American culture but is a part of Russian daily life and in some ways less alien or foreign than other brands. 

There are many employees. They make a lot.

Economically, too, the departure is significant – McDonald’s employs 62,000 people across Russia. The number of job losses due to the departure of hundreds of foreign businesses is in the hundreds. 

McDonald’s announced that it will be selling its business which includes 847 restaurants. The company stated that Russia’s “humanitarian crisis” and an unpredictable operating environment have caused McDonald’s to decide that continuing to own the Russian business is not feasible or consistent with McDonald’s’ values.

The logo for the McDonald’s closed restaurant at the Aviapark shopping centre in Moscow, Russia. March 18th, 2022.

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Chris Kempczinski, the CEO stated that he was proud to have all company workers working in Russia. The decision was also “extremely difficult.” Kempczinski also stated that employees would continue to receive their salaries until the company is sold, and that they could still work with potential buyers in the future.

Shoppers gaze towards the closed McDonald’s, KFC and KFC outlets at Mega Mall in Khimki (Russia), March 27, 2022.

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According to McDonald’s, McDonald’s will write off Russia’s exit costs of $1.2 billion to $1.4 trillion. The company said that closing down its Russian outlets for the first week had a significant impact on its earnings, and cost them $127 million in quarter last year. In 2021, McDonald’s revenues were 9% due to its Ukrainian restaurants and 8% from Russia.

“Crucial Soft Diplomacy” during the Cold War

Tricia Starks is a University of Arkansas professor of history and the author of “Cigarettes and Soviets” – a book about politics that also benefited from the influence of the golden arches.

“The American way of consumption was a crucial soft-diplomacy front in the Cold War … acquainting the Soviets with America’s material standards was another field of battle,” Starks said. This role was also played by Marlboro and Pepsi, both in 1972 and 1976 respectively. 

In 1990, a Soviet officer stands beside a line of customers waiting for entry to a McDonald’s newly opened on Gorky Street.

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She said that McDonalds was a completely immersive experience of the sensual pleasures of capitalism, and not like a Marlboro pack or can of Pepsi. 

The experience was completely new. With smiles, greetings and shouts of “Can you help me?” The products were always of high quality and easily consumed. “The burgers were delicious!” 

Soviet residents were stunned by the change in culture. Staff would often smile at them, causing confusion. One Russian worker at McDonald’s opened McDonald’s in 1990 said to a reporter that when I smile people ask what’s up, and they believe I’m laughing at them.

Traditionally dressed Russian musicians performed in front the most crowded McDonald’s in Russia in Pushkin Square, Moscow on the 15th anniversary since the restaurant opened in Russia. This was during January 31, 2005.

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“When you were done, a worker would come and whisk away the trash, and the showplace on Pushkin Square was kept clean despite the thousands who would come by through the day — some of them waiting hours to spend a full month’s wages on dinner for a family of four,” Starks described, noting that customer service was simply not a concept in the USSR. McDonald’s was known for its service.

“Thank you” for your Sanctions

Some Russians don’t feel so bad about their golden arches being removed. 

“Hello Americans … We want to thank you for all your sanctions, for taking away from our country Coca Cola, KFC, McDonald’s and all that sh–. “By summer, we’ll be strong, healthy and free from ass fat,” Russian comedian Natasha Krasnova said in a March Instagram post that received more than 5,000,000 views. 

Moscow’s mobile fast-food van can be seen selling alternative food options after McDonald’s closes its nearly 850 outlets across Russia. March 21, 2022.

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Russians are strongly in favor of replacing Western brands with Russian-made ones. They can now make their own hamburgers and other fast food items. A few have advocated the substitution of American food for local cuisines, since many Russians are against Western symbols. 

An image of a McDonald’s in Murmansk (Russia), the northmost city of the globe, March 11, 2022. The chain announced that it will temporarily shut down all its 850 Russian restaurants due to Ukraine’s invasion. It announced in May that it would be leaving Russia.

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Russians are bitter that they have to face the negative consequences of wars they didn’t choose. These consequences are nothing compared to what has been done to Ukraine where hundreds of civilians were killed and many cities have been reduced to rubble.

However, as Russia’s war drags on, the sanctions against Russia become more severe, the time will show how many Russians will leave their country to seek a better world. How many will remain loyal to Russia, while others will turn against this world. 

Nishanov doesn’t just care about McDonald’s. He sees it as something more. 

“McDonald’s leaving Russia hits many of my generation differently,” he said, “I think because it represented — and I know this sounds dramatic —  hope and optimism. Putin’s Russia, as it is now, has seen its company leave.

 

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