Professional Documents
Culture Documents
ing around 68 million customers daily in 119 countries across 35,000 outlets.[5]
[6] Headquartered in the United States, the company began in 1940 as a barbecue
restaurant operated by Richard and Maurice McDonald. In 1948, they reorganized t
heir business as a hamburger stand using production line principles. Businessman
Ray Kroc joined the company as a franchise agent in 1955. He subsequently purch
ased the chain from the McDonald brothers and oversaw its worldwide growth.[7]
A McDonald's restaurant is operated by either a franchisee, an affiliate, or the
corporation itself. The McDonald's Corporation revenues come from the rent, roy
alties, and fees paid by the franchisees, as well as sales in company-operated r
estaurants. In 2012, the company had annual revenues of $27.5 billion and profit
s of $5.5 billion.[8] According to a 2012 BBC report, McDonald's is the world's
second largest private employer behind Walmart with 1.9 million employees, 1.5 milli
on of whom work for franchises.[9]
McDonald's primarily sells hamburgers, cheeseburgers, chicken, french fries, bre
akfast items, soft drinks, milkshakes, and desserts. In response to changing con
sumer tastes, the company has expanded its menu to include salads, fThe business
began in 1940, with a restaurant opened by brothers Richard and Maurice McDonal
d at 1398 North E Street at West 14th Street in San Bernardino, California (at 3
4.1255N 117.2946W). Their introduction of the "Speedee Service System" in 1948 fur
thered the principles of the modern fast-food restaurant that the White Castle h
amburger chain had already put into practice more than two decades earlier. The
first McDonalds with the arches opened in Phoenix in March 1953. The original ma
scot of McDonald's was a man with a chef's hat on top of a hamburger-shaped head
whose name was "Speedee". By 1967, Speedee was eventually replaced with Ronald
McDonald when the company first filed a U.S. trademark on a clown-shaped man hav
ing puffed-out costume legs.
On May 4, 1961, McDonald's first filed for a U.S. trademark on the name "McDonal
d's" with the description "Drive-In Restaurant Services", which continues to be
renewed through the end of December 2009. On September 13 that same year, the co
mpany filed a logo trademark on an overlapping, double-arched "M" symbol. By Sep
tember 6, 1962, this M-symbol was temporarily disfavored, when a trademark was f
iled for a single arch, shaped over many of the early McDonald's restaurants in
the early years. Although the "Golden Arches" logo appeared in various forms, th
e present version as a letter "M" did not appear until November 18, 1968, when t
he company applied for a U.S. trademark.
The present corporation dates its founding to the opening of a franchised restau
rant by Czech American businessman Ray Kroc in Des Plaines, Illinois on April 15
, 1955, the ninth McDonald's restaurant overall; this location was demolished in
1984 after many remodels. Kroc later purchased the McDonald brothers' equity in
the company and led its worldwide expansion, and the company became listed on t
he public STOCK MARKETS ten years later. Kroc was also noted for aggressive busi
ness practices, compelling the McDonald brothers to leave the fast-food industry
. Kroc and the McDonald brothers all feuded over control of the business, as doc
umented in both Kroc's autobiography and in the McDonald brothers' autobiography
. The San Bernardino restaurant was demolished in 1976 (1971, according to Juan
Pollo) and the site was sold to the Juan Pollo restaurant chain. This area now s
erves as headquarters for the Juan Pollo chain, as well as a McDonald's and Rout
e 66 museum.[13] With the expansion of McDonald's into many international MARKET
S, the company has become a symbol of globalization and the spread of the Americ
an way of life. Its prominence has also made it a frequent topic of public debat
es about obesity, corporate ethics and consumer responsibility.
Headquarters
ed was muted to terra cotta, the yellow was shifted to golden for a more "sunny"
look, and olive and sage green were also added. To create a warmer look, the re
staurants have less plastic and more brick and wood, with modern hanging lights
to produce a softer glow. Many restaurants now feature free Wi-Fi and flat scree
n TVs. Other upgrades include double drive-thrus, flat roofs instead of the angl
ed red roofs, and replacing fiber glass with wood. Also, instead of the familiar
golden arches, the restaurants now feature "semi-swooshes" (half of a golden ar
ch), similar to the Nike swoosh.[44]
Business model
McDonald's Corporation earns revenue as an investor in properties, a franchiser
of restaurants, and an operator of restaurants. Approximately 15% of McDonald's
restaurants are owned and operated by McDonald's Corporation directly. The remai
nder are operated by others through a variety of franchise agreements and joint
ventures.[citation needed]
The McDonald's Corporation's business model is slightly different from that of m
ost other fast-food chains. In addition to ordinary franchise fees and MARKETING
fees, which are calculated as a percentage of sales, McDonald's may also collec
t rent, which may also be calculated on the basis of sales. As a condition of ma
ny franchise agreements, which vary by contract, age, country, and location, the
Corporation may own or lease the properties on which McDonald's franchises are
located. In most, if not all cases, the franchisee does not own the location of
its restaurants.[citation needed]
The United Kingdom and Ireland business model is different from the U.S, in that
fewer than 30% of restaurants are franchised, with the majority under the owner
ship of the company. McDonald's trains its franchisees and others at Hamburger U
niversity in Oak Brook, Illinois.[citation needed]
In other countries, McDonald's restaurants are operated by joint ventures of McD
onald's Corporation and other, local entities or governments.[citation needed]
As a matter of policy, McDonald's does not make direct sales of food or material
s to franchisees, instead organizing the supply of food and materials to restaur
ants through approved third party logistics operators.[citation needed]
According to Fast Food Nation by Eric Schlosser (2001), nearly one in eight work
ers in the U.S. have at some time been employed by McDonald's. Employees are enc
ouraged by McDonald's Corp. to maintain their health by singing along to their f
avorite songs in order to relieve stress, attending church services in order to
have a lower blood pressure, and taking two vacations annually in order to reduc
e risk for myocardial infarction.[45]
Fast Food Nation also states that McDonald's is the largest private operator of
playgrounds in the U.S., as well as the single largest purchaser of beef, pork,
potatoes, and apples. The selection of meats McDonald's uses varies to some exte
nt based on the culture of the host country.[citation needed]
Smoking ban
McDonald's began banning smoking in 1994, when it banned smoking within its 1,40
0 wholly owned restaurants.[46]
Wages
See also: Fast food worker strikes
As reported by Glassdoor, McDonald's pays entry level employees between $7.25 an
hour and $11 an hour with an average of no higher than $8.69 an hour. Shift man
agers get paid an average of $10.34 an hour. Assistant managers get paid an aver
age of $11.57 an hour.[47] However, multiple studies and lawsuits have shown tha
t many McDonald's restaurants pay less than the minimum wage to entry positions
est cases in British civil law. A documentary film of the McLibel Trial has been
shown in several countries."BBC NEWS | UK | McLibel: Longest case in English hi
story". BBC News. Retrieved April 9, 2015.In the late 1980s, Phil Sokolof, a mil
lionaire businessman who had suffered a heart attack at the age of 43, took out
full page newspaper ads in New York, Chicago, and other large cities accusing Mc
Donald's menu of being a threat to American health, and asking them to stop usin
g beef tallow to cook their french fries.[citation needed]
Despite the objections of McDonald's, the term "McJob" was added to Merriam-Webs
ter's Collegiate Dictionary in 2003.[57][unreliable source?] The term was define
d as "a low-paying job that requires little skill and provides little opportunit
y for advancement".[58]
In 2001, Eric Schlosser's book Fast Food Nation included criticism of the busine
ss practices of McDonald's. Among the critiques were allegations that McDonald's
(along with other companies within the fast food industry) uses its political i
nfluence to increase its profits at the expense of people's health and the socia
l conditions of its workers. The book also brought into question McDonald's adve
rtisement techniques in which it targets children. While the book did mention ot
her fast-food chains, it focused primarily on McDonald's.
In 2002, vegetarian groups, largely Hindu and Buddhist, successfully sued McDona
ld's for misrepresenting its French fries as vegetarian, when they contained bee
f broth.[59]
Morgan Spurlock's 2004 documentary film Super Size Me said that McDonald's food
was contributing to the epidemic of obesity in society, and that the company was
failing to provide nutritional information about its food for its customers. Si
x weeks after the film premiered, McDonald's announced that it was eliminating t
he super size option, and was creating the adult Happy Meal.
Screenshot from McDonald's Videogame
In 2006, an unsanctioned McDonald's videogame was released online. It is parody
of the business practices of the corporate giant, taking the guise of a tycoon s
tyle business simulation game. In the game, the player plays the role of a McDon
ald's CEO, choosing whether or not to use controversial practices like genetical
ly altered cow feed, plowing over rainforests, and corrupting public officials.
McDonald's issued a statement distancing itself from the game.[60]
In January 2014 it was reported that McDonald's was accused of having used a ser
ies of tax maneuvers to avoid paying its fair share of taxes in France. The comp
any confirmed that tax authorities had visited McDonald's French headquarters in
Paris but insisted that it had not done anything wrong, saying, "McDonald's fir
mly denies the accusation made by L'Express according to which McDonald's suppos
edly hid part of its revenue from taxes in France."[61]
Arguments in defense
In response to public pressure, McDonald's has sought to include more healthy ch
oices in its menu and has introduced a new slogan to its recruitment posters: "N
ot bad for a McJob".[62] (The word McJob, first attested in the mid-1980s[63][un
reliable source?] and later popularized by Canadian novelist Douglas Coupland in
his book Generation X, has become a buzz word for low-paid, unskilled work with
few prospects or benefits and little security.) McDonald's disputes this defini
tion of McJob. In 2007, the company launched an advertising campaign with the sl
ogan "Would you like a career with that?" on Irish television, asserting that it
s jobs have good prospects.
In an effort to respond to growing consumer awareness of food provenance, the fa
st-food chain changed its supplier of both coffee beans and milk. UK chief execu
instance, an "average meal" in the 1970s a Big Mac, fries, and a drink required 46 g
rams of packaging; today, it requires only 25 grams, allowing a 46% reduction.[8
0] In addition, McDonald's eliminated the need for intermediate containers for c
ola by having a delivery system that pumps syrup directly from the delivery truc
k into storage containers, saving two million pounds (910 tonnes) of packaging a
nnually.[81] Overall, weight reductions in packaging and products, as well as th
e increased usage of bulk packaging ultimately decreased packaging by twenty-fou
r million pounds (11,000 tonnes) annually.[82]
Legal cases
Main article: McDonald's legal cases
McDonald's has been involved in a number of lawsuits and other legal cases, most
of which involved trademark disputes. The company has threatened many food busi
nesses with legal action unless it drops the Mc or Mac from TRADING names. In on
e noteworthy case, McDonald's sued a Scottish caf owner called McDonald, even tho
ugh the business in question dated back over a century (Sheriff Court Glasgow an
d Strathkelvin, November 21, 1952). On September 8, 2009, McDonald's Malaysian o
perations lost a lawsuit to prevent another restaurant calling itself McCurry. M
cDonald's lost in an appeal to Malaysia's highest court, the Federal Court.[83]
McDonald's has defended itself in several cases involving workers' rights. In 20
01, the company was fined 12,400 by British magistrates for illegally employing a
nd over-working child labor in one of its London restaurants[citation needed] (R
v 2002 EWCA Crim 1094). In April 2007, in Perth, Western Australia, McDonald's
pleaded guilty to five charges relating to the employment of children under 15 i
n one of its outlets and was fined A$8,000.[84]
Possibly the most famous legal case involving McDonald's was the 1994 decision i
n Liebeck v. McDonald's Restaurants where Stella Liebeck was awarded several mil
lion dollars after she suffered third-degree burns after spilling a scalding cup
of McDonald's coffee on herself.[85]
Employment practices
See also: Fast food worker strikes
On August 5, 2013, The Guardian revealed that 90% of McDonalds' UK workforce are
on zero hour contracts, making it possibly the largest such private sector empl
oyer in the country.[86]
A study released by Fast Food Forward conducted by Anzalone Liszt Grove Research
showed that approximately 84% of all fast food employees working in New York Ci
ty in April 2013 had been paid less than their legal wages by their employers.[8
7]
From 2007 to 2011, fast food workers in the US drew an average of $7 billion of
public assistance annually resulting from receiving low wages.[88] The McResourc
e website advised employees to break their food into smaller pieces to feel full
er, seek refunds for unopened holiday purchases, sell possessions online for qui
ck cash, and to "quit complaining" as "stress hormone levels rise by 15 percent
after ten minutes of complaining."[89] In December 2013, McDonald's shut down th
e McResource website amidst negative publicity and criticism. McDonald's plans t
o continue an internal telephone help line through which its employees can obtai
n advice on WORK AND LIFE problems.[90]
In March 2015, McDonald's workers in 19 US cities filed 28 health and safety com
plaints with OSHA which allege that low staffing, lack of protective gear, poor
training and pressure to work fast has resulted in injuries. The complaints also
allege that, because of a lack of first aid supplies, workers were told by mana
gement to treat burn injuries with condiments such as mayonnaise and mustard. Th
e Fight for $15 labor organization aided the workers in filing the complaints.[9
1]