" If a place has really good food, it can be in an obscure location, charge a lot, and have really bad service, and it will still be popular. If it has bad food, boy, it better do something really special to get anybody in there."
The "special" can be "location". Food on the NJ Turnpike (or similar) is an example of a captive market where quality of food is not the key ingredient but landing the contract and being merely acceptable can still be very profitable.
Likewise being in Times Square, if you can afford the rent, can be profitable because you are not worried about repeat business but simply grabbing the tourists that will only be a customer one time.
I see the times square trend in Myrtle Beach, in a slightly different way: poorly run (which includes bad food) restaurants can be open only seasonal, get sufficient 'incidental' business to survive and then shut down during the off season due to low property costs. I suspect eventually property valuations will make it too attractive to sell out to more profitable business, whether thats due to being better run or all-year.
Just to be clear, this rule doesn't work for McDonalds - as it's an established brand. Their food is awful, but the place tends to be clean and tidy - with a toilet.
Interestingly, where I live, Burger Kings tend to be filthy and poorly maintained, with slightly better tasting food. They are also popular - so cleanliness doesn't seem to be a major contributor.
McDonalds' food is awful by what standard, precisely? From a health standpoint, sure. From the standpoint of a foodie, yes. From the standpoint of pretty much anyone who is accustomed to nicer food, in nicer circumstances, sure.
But McDonalds isn't competing on the dimension of "quality" as other restaurants might define that term. McDonalds is competing on scale and consistency. A Big Mac [1] in Jakarta tastes identical to a Big Mac in Cleveland. A pack of fries in Moscow tastes identical to a pack of fries in Istanbul. If you walk into a McDonalds in any part of the world, barring a few local specialties on the menu, you know exactly what you're going to get, and exactly when you're going to get it. That's pretty damned remarkable.
McDonalds runs a marketing and logistics company, not a restaurant chain.
Also, McDonalds is pretty tasty if you're too poor to consistently afford better. Their fries in particular are an amalgam of fat and salt, two of the most pleasing flavors that are available cheaply.
McDonalds' fries are the perfect fat/carb/salt delivery vehicle. I would pit them against heroin in their ability to hit the brain's pleasure centers. :)
I once heard a story in grad school, from a professor who consulted with McD's in Marketing. I'm not sure if this story is apocryphal, or maybe entirely fictional. But it goes like this: why are McDonalds' fries so thin? Why didn't they make thicker fries, which were all the rage back when the first few franchises were getting off the ground? It's because thinner fries can be grabbed by the handful, while thicker fries get picked up one by one. As a result, people scarf down thinner fries and will consume more volume in a single serving.
The story made me think, because suddenly I became aware of the fact that I'm a cluster-grabber of McD's fries. I have friends who pick out one at a time. Every now and then, on those rare occasions we grab fast food, I'll pay attention to who eats fries how.
The "special" can be "location". Food on the NJ Turnpike (or similar) is an example of a captive market where quality of food is not the key ingredient but landing the contract and being merely acceptable can still be very profitable.
Likewise being in Times Square, if you can afford the rent, can be profitable because you are not worried about repeat business but simply grabbing the tourists that will only be a customer one time.