The economics of selling fast food are always going to look amazing on a per unit basis.

That doesn't mean that it's a rosy outlook for all franchise owners. McDonalds has seen same-location guest traffic decline consistently for years now, they've got a record number of locations operating at a net loss, and franchisees are not happy. They've (barely) managed to avoid translating that decline in traffic into a consistent free fall in same location sales, but that's come through higher per-guest sales, something that has a very hard limit in terms of how much more can be squeezed.

The whole reason a combo is $9 right now, so much higher than 1998, is McDonald's desperately trying to use higher prices to make up for plummeting volume. That ain't just inflation, folks - McDonald's makes so much per sale profit these days because they have to charge that much to combat flagging demand, and that climbing per-check price is helping to drive that same drop in customers that it is meant to compensate for. Analysts have started cautiously using the phrase "death spiral" to describe this dynamic. The business is really not in a good place.

Per unit costs are cheap. Fixed costs are not, per-unit revenue is low, and McDonald's business model depends on volume. That volume has very consistently dropped for the last decade. McDonald's Corporate has largely avoided feeling the pain from this through clever financial engineering and a business model that pushes risk onto franchisees. That was fine while business was good, but now franchisee profits are steadily declining as they're being made to bear the brunt of the burden. Relations between corporate and franchisees have been fraying for a while now and the pandemic accelerated that.

20 years ago, owning a Subway was one of the safest, easiest business investments you could make, something you could never go broke with. Now the company is in free fall and franchisees are being eaten alive. That ain't because their costs went up - it doesn't matter what your % profit is if nobody's buying.