Arcos Dorados Holdings
| Company type | Public |
|---|---|
| Industry | Quick service restaurant |
| Founded | August 3, 2007 |
| Founder | Regional management team (after purchase from McDonald's) |
Area served | Latin America and the Caribbean (20 countries) |
Key people | Woods Staton (Chairman and CEO) |
| Products | Fast food (McDonald's menu items, McCafé, Dessert Centers) |
Number of employees | 100,000+ (2024) |
Arcos Dorados Holdings (translated as Golden Arches Holdings in English) serves as the master franchise for the fast food giant McDonald's across 20 nations in Latin America and the Caribbean. By October 2024, the company operates close to 2,400 outlets, positioning itself as the largest independent McDonald's franchise worldwide and the foremost quick-service restaurant (QSR) chain in this region, catering to over 4.3 million customers daily.
Revenue streams for Arcos Dorados stem from sales at its company-run restaurants alongside rental income from franchised establishments, with lease payments calculated either as a fixed fee or a percentage of sales—whichever amount is greater. As of June 30, 2024, the workforce exceeds 100,000 employees.
Representing about 6.7% of McDonald's franchised locations globally, Arcos Dorados is set to commence a new 20-year master franchise contract with McDonald's on January 1, 2025. This agreement includes an initial royalty rate of 6% during the first ten years, which will increase thereafter.
Business areas
Arcos Dorados has operations spanning Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curaçao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Peru, Puerto Rico, St. Croix, St. Thomas, Trinidad and Tobago, Uruguay, and Venezuela. Notably, the company contributed significantly to the 2014 FIFA World Cup by training over 15,000 volunteers in customer service.
History
The McDonald's brand made its regional debut with a restaurant in Puerto Rico in 1967 before expanding into Costa Rica (1970), Panama (1971), Brazil (1979), Mexico and Venezuela (1985), and Argentina (1986). The entity known as Arcos Dorados ("golden arches" in Spanish) was founded on August 3, 2007, following a purchase of McDonald’s Latin American operations by regional management. Woods Staton—Chairman and CEO of Arcos Dorados—had previously been McDonald's joint venture partner in Argentina for over two decades and led the South Latin America division prior to this acquisition. The company went public on April 14, 2011, listing its shares on the New York Stock Exchange (NYSE).
Operations
In 2012, Arcos Dorados reported nearly $3.8 billion in revenues, representing about 5.6% of McDonald's total global income. It stands as the largest fast-food chain throughout Latin America and the Caribbean—surpassing its closest competitor by more than threefold. Despite this prominence, McDonald's market penetration is still less dense than in the U.S., where there is one restaurant per approximately 22,200 people compared to one per 254,000 residents in Mexico, Costa Rica, and Panama; one per 310,700 inhabitants in Brazil; and one per roughly 317,400 across other South American nations.
Company-operated and franchised restaurants
Arcos Dorados runs McDonald's outlets through both company-owned and franchised formats. Approximately three-quarters of its locations are directly owned and operated by the company itself. The remaining quarter are franchised operators who benefit from comprehensive technical and operational support including training programs, operational guidelines, supply chain integration, and marketing resources.
McCafé locations and Dessert Centers
Launched in 1999, the McCafé brand aims to attract different customer segments during breakfast hours and after lunch by offering specialty coffees and hot chocolate within designated areas inside McDonald’s restaurants. By 2021, there were 298 McCafé sites throughout Latin America. In addition to this concept are "Dessert Centers," which focus on classic McDonald’s desserts such as the McFlurry and soft-serve ice cream; as of 2021, there were 3,265 Dessert Centers operating across the region. The inaugural Dessert Center was established in Costa Rica back in 1986.
Restaurant Redesign
From 2010 through 2012, Arcos Dorados undertook renovations in more than 260 locations, introducing expanded communal areas, modern furnishings, warmer color palettes, curated artwork, expansive windows, and outdoor seating arrangements equipped with tables and umbrellas to elevate the dining atmosphere.
Menu Offerings
The menu at Arcos Dorados features classic McDonald's staples such as hamburgers, French fries, salads, and chicken sandwiches, alongside localized specialties like flan-style desserts in Peru, dulce de leche sweets in Argentina and Uruguay, and McMolletes—English muffins topped with refried beans, cheese, and salsa—in Mexico. The menu is structured into various price segments, starting with budget-friendly options like the "Combo del Día," advancing to signature items including the Big Mac and Happy Meal, and extending to premium selections such as the Big Tasty or Angus burgers and chicken sandwiches.
Health and Nutrition Initiatives
In 2011, Arcos Dorados launched an updated Happy Meal featuring reductions in sodium, calorie content, and fat. All Happy Meal choices across Latin America contain fewer than 600 calories—less than one-third of the daily recommended intake for children as advised by the World Health Organization. That same year, sodium content was lowered by an average of 10% in components like buns, McNuggets, cheese, and ketchup. By 2013, Arcos Dorados became the pioneer Latin American chain to display calorie information directly on menu boards. Nutritional details are prominently available in all outlets through posters and tray liners, with comprehensive information accessible on the company’s website.
Marketing and Promotions
Arcos Dorados capitalizes on McDonald's worldwide sponsorships such as those for the Olympic Games and Brazil’s 2014 FIFA World Cup. The company also executes regional marketing initiatives like the McDonald's Monopoly campaign across Latin American countries including Chile, Argentina, and Brazil. Addressing concerns regarding marketing aimed at children, Arcos Dorados implemented McDonald's Children's Marketing Global Guidelines in 2008. These guidelines encourage balanced dietary choices tailored to children’s nutritional requirements, promote physical activity through licensed characters, communicate positive wellness messages, offer resources for parents, and involve third-party oversight of advertising practices.
Workforce
As one of the largest employers in Latin America, Arcos Dorados Holdings employs over 100,000 individuals, predominantly youth—with approximately 90% under the age of 24—emphasizing its commitment to providing first-time employment opportunities. The company delivers comprehensive training via McDonald's University, which offers courses for both managers and staff covering restaurant operations, sales techniques, marketing strategies, and accounting principles. More than 52,000 participants throughout Latin America have engaged in these educational programs.
In 2012, Arcos Dorados became a partner in the New Employment Opportunities (NEO) Program initiated by the Inter-American Development Bank and International Youth Foundation. The company invested $37 million aimed at enhancing job prospects for young people, particularly those from low-income backgrounds. Additionally, it introduced MCampus Comunidade—a free learning platform serving over 40,000 users with courses on personal finance management, digital marketing skills, and emotional intelligence development. These efforts underscore Arcos Dorados’ dedication to workforce development while maintaining its status as a key regional employer.
Charity
Arcos Dorados actively supports the Ronald McDonald House Charities (RMHC), which operates 67 initiatives across 13 countries in Latin America and the Caribbean as of 2021. These efforts include 30 Ronald McDonald Houses, 35 Family Rooms, and 2 Care Mobiles that provide pediatric healthcare in underserved regions. In 2021, McHappy Day, McDonald's international fundraising event for RMHC, generated close to $6 million in Latin America by leveraging Big Mac sales to back multiple children's programs.
Sustainable food sourcing
Since the mid-1990s, McDonald's has partnered with animal welfare specialist Temple Grandin to promote humane treatment within its supply chain. The company collaborates with pork producers to eliminate the use of gestation crates and is establishing traceability mechanisms to ensure meat is sourced without involving such facilities. Additionally, McDonald's has been a participant in the Global Roundtable for Sustainable Beef (GRSB) since 2012, fostering sustainable beef production through collective stakeholder engagement.
Supply chain
Arcos Dorados mandates that all suppliers of food and paper adhere to McDonald's Supplier Workplace Accountability standards, which emphasize ethical labor practices, safe working environments, and product quality. To ensure compliance, the company performs frequent audits throughout Latin America and the Caribbean, assessing suppliers against international criteria such as ISO, BRC, and HACCP.
Reducing consumption
To enhance environmental sustainability, Arcos Dorados has adopted measures aimed at lowering water and energy usage while reducing waste in its outlets. For instance, one Brazilian restaurant implemented a system that captures condensation from air conditioning units, repurposing it for cleaning and irrigation purposes—resulting in a daily water savings reduction from 8,000 to 6,800 liters.