The year is 1955 and the American economy is booming; suburban growth is rampant and cultural mores are being cracked and forgotten. Ray Krok is a middle-class salesman desperately trying to make a living. He does not have much going for him, but he does have a drive and determination. that for better or worse will later carry him into the world of the rich. For now, he is forced to travel the country, desperately trying to sell his milkshake making machine. That is, until one day he dines at the "restaurant" of Dick and Maurice McDonald.
These brothers have gone through numerous businesses and restaurants, but finally engineered a workspace in which a meal can make it to a customer in only thirty seconds. They call this the Speedee system and because of its clear ease-of-use, their restaurant is booming. They give Ray a tour and explain how they only sell burgers and fries because that is what 80% of people buy anyway. Ray is blown away by the operation and see's a tremendous future for this restaurant. However, the brothers are very critical of expansion, believing that it results in quality control. After significant bickering, the brothers agree to partner with Ray and to start chains nationally.
The initial expansion, as one might expect, was tremendous. But the company would have been drowned out by competition had it not been for much of Ray Krok's decision making. He wanted the restaurant to be like a religion. He wanted the golden arches of the restaurant to symbolize family and the restaurant to be an American safe-space. Furthermore was also a sharp businessman. The company quickly blew up.
Restaurants were opening up nationally, but as this happened the tension between the McDonald brothers and Ray Krok also grew. The two parties would argue over the phone for hours on end, Ray always wanting to drop costs and increase expansion while the brothers wanted to preserve the feel of the original location. Tensions reached a high when Ray began using instant milkshake mix and when he began his own real estate company to buy and control the land the establishments were built on. Soon, Ray made the momentous decision to buy the brothers out, hence severing all ties to the original restaurant. Growth did not end there. Today McDonald's feeds almost 1% of the world population daily.
I would like to end this with a quote by Calvin Coolidge (30th US President) that is repeated several times in the movie:
"Nothing in this world can take the place of persistence. Talent will not: nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not: the world is full of educated derelicts. Persistence and determination alone are omnipotent"
I found this post very interesting. I did not know about the history of McDonalds and found this very informative. It is interesting that the brothers and Ray had such different views for the future of the restaurant. It is also impressive that McDonalds feeds almost 1% of the world daily.
ReplyDeleteI liked how informative your post was. It shows how integrating Henry Ford's assembly line system can work with pretty much anything. I'm fascinated by how adaptive McDonalds has been, especially in the past decade. They redesigned their stores to look more aesthetically pleasing so people would be more inclined to spend time there (this is kind of like the Starbucks business model) Also, they have tried to include more healthy things in their menu, as well as more premium items. I think that this willingness to embrace changes in the preferences of their consumers and to innovate will keep them successful in the long run.
ReplyDeleteFor example, here is the worlds "fanciest" McDonalds in Hong Kong.
https://kotaku.com/the-mcdonalds-of-the-future-opens-in-hong-kong-1750271639
Nice post, I found it really interesting to see how such a large restaurant chain came to be. I also find it kind of sad to see that the original owners were eventually pushed out of their own restaurants. I wonder when they were bought out, did they know at the time that McDonalds would continue to grow into a global chain?
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