McDonald’s
McDonald’s
The history of the global fast food company started with two brothers Richard and Maurice McDonald opening the very first McDonald’s restaurant in California, USA in 1940. Franchising began for McDonald’s in 1953, and four restaurants were opened in the same year. The joining of Ray Kroc in 1954 proved to be a turning point for the company and McDonald’s began franchising their restaurant outside of their hometown as well.
The sale of 100 millionth hamburger for McDonald’s in 1958 was followed by the opening of 100th restaurant the year after. Ray Kroc buys McDonald’s from founding brothers in 1961 and after two years the company sells its billionth hamburger and opens its 500th franchise in Ohio. Initial overseas McDonald’s opened in Canada and Puerto Rico in 1970. In 1971 McDonald’s expanded to Japan, Netherlands, Germany and Australia. McDonald’s revenues reached $1 billion and 2000th restaurant opened in 1972. And it was followed by the invention of Quarter Pounder and Egg McMuffin and opening franchise in Stockholm. The years of 1974 and 1975 witnessed the expansion of McDonald’s to the United Kingdom, opening of the first Ronald McDonald House and introduction of Drive-Thru. Also, the company expanded to Japan and Singapore and Happy Meal was introduced during the remaining part of the 1970’s.
During 1980’s McChicken sandwich and Chicken McNuggets were introduced and restaurants were opened in Philippines, Malaysia, Italy, Mexico, Belgrade, Yugoslavia, Budapest and Hungary. McDonald’s continued worldwide expansion during 1990’s opening shops in Moscow, China, Africa, Morocco, Saudi Arabia, South Africa, Belarus, Peru, India and Georgia.
Difficult time began for McDonald’s in 2000’s starting with the launch of a book called Fast Food Nation written in 2001 by Eric Schlosser which criticised McDonald’s for selling unhealthy food. It partially resulted in the first quarterly loss in company’s history in fall 2002. Global marketing campaign is initiated within company promoting healthier McDonald’s image with the slogan “I’m lovin’ it”
The company suffers more blows caused by the documentary Super Size Me, in which the director and star Morgan Spurlock proves that eating McDonald’s ass the time has bad consequences for a person’s health, and the company is forced to remove Supersize options from the menu. One of the changes the company undertook in 2006 was including nutritional information on all packaging for all products. New products – McSkillet burrito, Chicken Biscuit and the Southern Style Chicken Sandwich are introduced in 2008, together with new design for the food containers and a new menu board design. The practice of introducing new products continued in 2009 with the introduction of new versions of Angus Burgers – Angus Deluxe, Angus Bacon and Cheese and Angus Mushroom and Swiss.
The first McDonald’s restaurant opened in UK in 1974 and since then, due to efficient strategy, flexibility and intense marketing strategy the brand has become a part of British culture. McDonald’s has 1193 outlets in UK, which sales rose 11 per cent in 2009 (Hall, 2010). However, it was a successful year not only for McDonald’s, Domino’s pizza sales increased by 15%, sandwich chain Subway announced to open 600 new stores in UK and Ireland, and KFC fried chicken chain opening 300 new restaurants (Mirror, 2010) – all due to recent financial crisis. According to King (online, 2010), in 2008 and 2009 there were an estimated 130 million more customer store visits, which has contributed around £465 million to the company sales revenue. Also, King (online, 2010) attributes the success of the company to the replacement of American McDonald’s chief executive in Britain with British born Steve Easterbrook in 2006, which resulted in McDonald’s becoming more local in all parts of UK.
McDonald’s success in UK fast food market and worldwide can be partially explained by its management structure, which is hierarchical, with several layers of management and every employee has a clear idea about their role and responsibilities. Also, standardisation of all business processes has been taken to a high degree which saves time and resources in operations.
Fast food has firmly identified itself as part of British culture with McDonald’s leading the way. It has both positive and negative affects on the nation. The positive affects are that time can be saved during the day when consuming fast food, they don’t cost much money and can be found round the corner. Unfortunately, currently its negative affects prevail which are the facts that alarming number of UK population is overweight or obese due to regular fast food consumption and communication between family members, and friends are missing which were previously conducted over dinner table. Moreover, along with the increasing popularity of fast food chains like McDonald’s, the opposition to them is also increasing in forms of books, documentaries, movies, demonstrations etc. These oppositions sometimes are aimed at a specific brand, in other cases they are aimed at fast food industry in general. But, nevertheless the damage they are causing to companies like McDonald’s is overwhelming.
Companies operating in fast food industry in UK and worldwide in general and McDonald’s company in particular should behave proactively in order to guard their image against “attacks” from non-government organizations, individual people and others, who criticise the fast food industry and specific companies, in many cases justifiably for damaging the nation’s health. Being proactive means investing in research and development in order to invent menus containing the amount of fat and salt which is within the limits of healthy eating.
References
- Hall, J, 22 January 2010, “McDonald’s creates 5,000 jobs in UK after record sales in 2009”, Telegraph, Accessed August 7, 2010. Available at: http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/7055643/McDonalds-creates-5000-jobs-in-UK-after-record-sales-in-2009.html
- King, I, 2010, “McDonald’s: the world’s local restaurant”, The Sunday Times, Accessed August 10, 2010. Available at: http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article7019741.ece