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McDonald’s history

Started as a restaurant in San Bernardino, California, by Richard and Maurice McDonald in 1940, the McDonald’s Company is an American international fast-food corporation. It is one of the most successful marketing brands in history. Chicago is where the headquarters of the corporation is based in

Hamburgers, cheeseburgers, and French fries are what McDonald’s is famous for. However, they also serve chicken, fish, fruit, and salads. The French fries are their best-selling licensed item, followed by the Big Mac. Rent, royalties, and fees paid by franchisees and sales in company-operated restaurants, generate revenue for the McDonald’s Company.

With 1.7 million employees, McDonald’s is the world’s second-largest private employer and it has the sixth-highest worldwide brand worth in 2022. McDonald’s has been criticised for the health impacts of its products, its staff treatment and other business practices.

French fries in a McDonald's box, symbolizing the fast-food industry and the iconic McDonald's brand.

History of McDonald

In San Bernardino, California, the two brothers launched the first McDonald’s restaurant in 1940. It was initially a drive-in with a large variety of products. Nonetheless, the brothers decided to restart the firm in 1948, and a newly envisioned McDonald’s opened after a three-month renovation. The little restaurant was built to provide large amounts of food at inexpensive rates. To do this, the brothers restricted the menu to hamburgers, potato chips (later replaced by french fries), beverages, and pie, and designed a basic, efficient structure known as the Speedee Service System.

Customers received their meal fast since hamburgers were made ahead of time, wrapped, and warmed under heat lamps, and this featured a self-service counter that removed the need for servers and waitresses. Because of these advances, the brothers could charge only 15 cents for a basic hamburger, which was almost half the price of rival businesses. McDonald’s was an enormous success, and the brothers launched a franchise scheme.

McDonald’s appliances were acquired from a salesman called Ray Kroc, who was attracted by their requirement for eight malt and shake mixers. He went to the restaurant in 1954 to observe how a little store could sell so many milkshakes. After noticing the potential in the brothers’ restaurant concept, Kroc became a franchise agent for them and he created McDonald’s Systems, Inc., later known as McDonald’s Corporation, in Des Plaines, Illinois April 1955. He also established the first McDonald’s franchise east of the Mississippi River there. In 1961, the McDonald brothers were bought by Kroc.

Development of the brand

Understanding the crucial role of franchisees in the company’s success, Kroc established strict guidelines for how each McDonald’s should be managed, from food preparation to cleaning. To guarantee the consistent management of the stores, he established (1961) a program to train franchisees, afterwards known as Hamburger University. Moreover, he ultimately altered the restaurant structure, adding counter personnel to accept orders, and in 1975, a McDonald’s in Arizona unveiled the chain’s first drive-through window, a feature that quickly became common.

Around this period, McDonald’s also adopted three aspects that would define its brand and increase public awareness. Originally, a clown named Ronald McDonald was presented as the firm’s public face in 1963. However, concerns over marketing to children and a rising unfavourable impression of clowns resulted in the company mainly ignoring the figure in the early twenty-first century. Arguably the most famous addition was when McDonald’s launched the Big Mac to its national menu in 1968; the iconic hamburger went on to become the company’s top-selling item after french fries.

Moreover, the business developed its logo during the 1960s, finally introducing the renowned double-arch M design, which became its enduring trademark and one of the most widely recognised logos; It was inspired by the massive yellow arches that had previously dominated the rooftops of McDonald’s restaurants. These innovations aided McDonald’s expansion. These innovations aided McDonald’s expansion. In less than ten years after Kroc became the sole proprietor of McDonald’s, the chain’s stores surpassed 1,000. These results helped the company’s stock begin trading publicly in 1965.

McDonald’s expansion & products

The chain expanded both domestically and globally. The first store outside the United States opened in 1967 in Richmond, British Columbia, Canada. There were around 34,000 outlets in over 115 nations and territories by the early twenty-first century. Growth was so quick in the 1990s that it was reported that every five hours, a new McDonald’s opened somewhere in the world. It quickly became the most popular family restaurant, focusing on economical meals, entertainment, and flavours that appealed to both children and adults.

Mcdonald’s menu evolved throughout time, with Filet-O-Fish sandwiches introduced in 1965, Quarter Pounders in 1973, Egg McMuffins in 1975, Happy Meals in 1979, and Chicken McNuggets in 1983. Furthermore, restaurants in other nations altered their menus to cater to local cultures and preferences.

McDonald’s expanded beyond the hamburger sector in the late twentieth century, purchasing Chipotle Mexican Grill (1998), Donatos Pizza (1999), and Boston Market (2000) in the United States, and Aroma Café (1999) and an investment in Pret A Manger (2001) in the United Kingdom. Nevertheless, by late 2008, McDonald’s no longer owned or had a stake in any of those businesses, choosing to focus on its own brand.

Holding a phone with the McDonald's logo, with a glowing background, emphasizing the brand's recognition and presence.

Criticism: How McDonald’s responded?

McDonald’s success drew greater criticism, most of which focused on its perceived relationship with a global increase in obesity. Many lawsuits were made against the corporation in the early 2000s in the United States, claiming that their food caused health concerns. Besides the fact that none of the plaintiffs was successful, a number of states established legislation prohibiting obesity claims against fast-food corporations. McDonald’s has faced criticism with the release of the famous documentary Super Size Me (2004), in which the director observed his health deteriorate while eating just McDonald’s dishes.

In response to the criticism, McDonald’s expanded their menu with healthier alternatives and created a vegan “hamburger” with names like McVegan, P.L.T., and McPlant. The firm debuted its first plant-based hamburger in 2017, however, it was only offered in a few regions. It began trying another vegan hamburger two years later. Furthermore, in 2018, McDonald’s declared that it will no longer use preservatives in the majority of its hamburgers. Around this period, the firm also eliminated supersized servings, and its restaurants in the United States and Canada ceased using trans fat in a variety of foods. Yet, such actions did nothing to alleviate health concerns.

Volunteering & charity work

McDonald’s has been involved in a number of charitable endeavours. It collaborated with Philadelphia Eagles football star Fred Hill, whose daughter was diagnosed with leukaemia, to establish the Ronald McDonald House in Philadelphia in 1974. Families were able to live close to the hospital where their children were undergoing treatment. Across the world, more than 360 similar residences existed by the early twenty-first century. Moreover, Ronald McDonald House Charities (founded in 1987) contributes to a variety of other causes. McDonald’s also established new programs, such as a college scholarship program for Latino kids.

Disclaimer:

This information is not considered investment advice or an investment recommendation, but instead a marketing communication. IronFX is not responsible for any data or information provided by third parties referenced or hyperlinked, in this communication.

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