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McDonald's
Company typePublic (NYSE: MCD)
IndustryRestaurants
FoundedMay 15, 1940 in San Bernardino, California
HeadquartersOak Brook, Illinois, United States
Key people
Dick and Mac McDonald, Founders
Ray Kroc, Founder of McDonald's Corporation
Jim Skinner, CEO
Michael J. Roberts, President/COO
Ronald McDonald, Corporate Mascot
ProductsFast food, including Big Mac, Quarter Pounder, Chicken McNuggets, french fries, and sundaes
RevenueIncrease$20.460 Billion USD (2005)
9,371,000,000 United States dollar (2022) Edit this on Wikidata
Increase$2.602 Billion USD (2005)
Total assets52,626,800,000 United States dollar (2020) Edit this on Wikidata
Number of employees
447,000 (2005)
Websitewww.mcdonalds.com
McDonald's Sekime national route store (Osaka, Japan)

McDonald's Corporation (NYSE: MCD) is one of the world's largest chains of fast-food restaurants.

This company began in 1940 with a restaurant opened by siblings Dick and Mac McDonald, but it was their introduction of the "Speedee Service System" in 1948 that established the principles of the fast-food restaurant. However, the company today dates its "founding" to the opening of CEO Ray Kroc's first franchised restaurant, the company's ninth, in 1955.

Corporate overview

McDonald restaurants are found in 118 countries and territories around the world, by the company's reckoning. They serve nearly 50 million customers each day. The company operates other restaurant brands, such as Aroma Café, Boston Market and Chipotle Mexican Grill, and has a minority stake in Pret a Manger. Until December 2003 it also owned Donatos Pizza. It also has a subsidiary, Redbox, which started in 2003 as 18-foot wide automated convenience stores, but as of 2005 has focused on DVD rental machines. Revenues for 2004 were US$19.1 billion, with net income at $2.75 billion. Most standalone McDonald's restaurants offer both counter and drive-through service, with indoor and sometimes outdoor seating. Drive-Thru, Auto-Mac, or McDrive as it is known in many countries, often has separate stations for placing, paying for, and picking up orders, though the latter two steps are frequently combined. In some countries "McDrive" locations near highways offer no counter service or seating. In contrast, locations in high-density city neighborhoods often omit drive-through service. There are also a few locations, located mostly in downtown districts, that offer Walk-Thru service in place of Drive-Thru. Specially themed restaurants also exist, such as "Rock-and-Roll McDonald's" 1950s themed restaurants. Some McDonald's in suburban areas and certain cities feature large indoor or outdoor playgrounds, called "McDonald's PlayPlace" or "Playland". These were primarily created in the 1970s and 1980s in the USA, but later internationally. Due to lawsuits over kids playing and getting hurt, many of these have been torn down. The McDonald's Corporation's business model is slightly different from that of most other fast-food chains. In addition to ordinary franchise fees, supplies, and percentage of sales, McDonald's also collects rent, partially linked to sales. As a condition of the franchise agreement, the Corporation owns the properties on which most McDonald's franchises are located. The UK business model is different, in that fewer than 30% of restaurants are franchised, with the majority under the ownership of the company. McDonald's trains its franchisees and others at Hamburger University in Oak Brook, Illinois. According to Fast Food Nation by Eric Schlosser (2001), nearly one in eight workers in the US have at some time been employed by McDonald's. The book 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 meats McDonald's uses vary with the culture of the host country.

Here at Mickey D's we only serve the bad meat left over from when they make Hot Dogs. So your sure to have bad gas and have to run to the bathroom and grab hold for the ride of your life. We never clean our restuarantts and we serve you french fries that have rat fecis all over them. But you dont care thatw why we our the worst and biggest food chain in america. we are also responsible for the large number of Obese women and children of the world.

Criticisms

McDonald's faces varying problems. Some of these are unique to franchising. As one of the world's largest and best recognized franchise systems, it must endeavour to successfully deal with matters of internal cohesion between the interests of its franchisees and that of the franchisor. At the same time, its global reach and broadly standard product line and level of service have led to McDonald's becoming the target of anti-globalization protests, and as the highest-profile fast food company, it is often blamed for obesity and excessive packaging waste. Its moves to protect its reputation and trademarks have at times been seen as heavy-handed.

As the world's largest restaurant chain, McDonald's also finds itself a target for external criticism. Even though its foreign franchise locations are usually locally owned and use locally-produced foods, the company is seen as a symbol of American domination of economic resources. Urban legends about the company and its food are plentiful and it is often the target of unusual lawsuits.

McDonald's has been the target of criticism for allegations of exploitation of entry-level workers, use of sweatshop labor to produce "happy meal" toys, ecological damage caused by agricultural production and industrial processing of its products, selling unhealthy food, production of packaging waste, exploitative advertising (especially targeted at children, minorities, and low-income people), and contributing to suffering and exploitation of livestock. McDonald's' historic tendency towards promoting high-calorie foods such as French fries has earned it the nickname "the starchy arches". Several McDonalds restaurants have been known to use substitute meats such as horse and wildebeest. [citation needed]

Greenpeace research alleges that not only is soya destroying the Amazon rainforest in Brazil, but soya farmers are guilty of further crimes including slavery and the invasion of indigenous peoples’ lands. The soya that is fed to McDonald’s chickens is supplied by agricultural giant Cargill and comes directly from Brazil. Cargill is the leading international culprit in the advance of soya in the Amazon. The accusation is that McDonald's, as a client of Cargill's, is complicit in these alleged activities. [1]

In the high profile McLibel Trial, McDonald's took two anti-McDonald's campaigners, Helen Steel and Dave Morris, to court for a trial lasting two and a half years—the longest in English legal history and part of a 20-year battle—after the pair distributed leaflets critical of the company in London's streets. McDonald's won the case in the U.K. High Court, and were awarded £60,000 damages, which later was reduced to £40,000 by the Court of Appeal. Steel and Morris then made a separate but related claim against the U.K. Government in the European Court of Human Rights, claiming that the lack of access to legal aid and the heavy burden of proof that lay with them to prove their claims (rather than McDonald's, the claimants, having to prove that the claims were false) under U.K. libel law breached the right to a fair trial and freedom of expression. The ECHR ruled against the U.K. Government, which subsequently introduced legislation to change the libel laws to remedy the defects highlighted by the ECHR judgment. The libel charge and fine were overturned in an appeals case - see McLibel case. In March, 2006, the Coalition of Immokalee Workers, a group of South Florida farmworkers, began a campaign demanding better wages for the people who pick the tomatoes used by the fast-food company.

McDonald's has also been criticized for its approach to preserving its image and copyrights. It has threatened many foodservice businesses with legal action unless they drop the Mc or Mac from their trading name. In one noteworthy case, McDonald's sued a Scottish café owner called McDonald, even though the business in question dated back over a century. Other legal battles include:

  • Pursuing a 26-year legal action against an Illinois restaurant owned by a man named Ronald McDonald (opened in 1956).
  • In 1994, McDonald's successfully forced Elizabeth McCaughey of the San Francisco Bay Area to change the trading name of her coffeeshop McCoffee, which had operated under that name for 17 years.
  • In 1994, McDonald's sued a restaurant in Kingston, Jamaica, because of trademark infringement, although it had opened in 1971, before McDonald's entered the Jamaican market.
  • In 1996, McDonald's lost a legal battle at the Danish Supreme Court to force Allan Pedersen, a mincemeat sandwich vendor, to drop his shop name McAllan.
  • In 1996, McDonald's forced Scottish sandwich shop owner Mary Blair of Fenny Stratford, Buckinghamshire to drop McMunchies as her trading name.
  • In 2001, McDonald's lost a nine-year legal action against Frank Yuen of McChina Wok Away, Chinese takeway outlets in various part of the UK.

In South Africa, McDonald's had to battle against the country's trademark laws, which stated that a registered trademark had to be used within a certain period of time. This resulted in a local company announcing plans to launch its own fast-food chain using the McDonald's name, although the South African High Court eventually ruled in McDonald's favor.

In July 2001, McDonald's was fined £12,400 by British magistrates for illegally employing and over-working child labor in one of its London restaurants. This is thought to be one of the largest fines imposed on a company for breaking laws relating to child working conditions.

Also in 2001, Eric Schlosser's book Fast Food Nation included scathing criticism of McDonald's' business practices. Among the critiques are allegations that McDonald's (along with other companies within the fast-food industry) uses its political influence to increase their own profits at the expense of people's health and the social conditions of its workers. The book also brings into question McDonald's advertisement techniques where it targets children taking advantage of their innocence. While the book does mention other fast-food chains, it focuses primarily on McDonald's.

In 2003, a ruling by the UK Advertising Standards Authority determined that the corporation had acted in breach of the codes of practice in describing how its french fries were prepared. A McDonald's print ad stated that "after selecting certain potatoes" "we peel them, slice them, fry them and that's it." It showed a picture of a potato in a McDonald's fries box. In fact the product was sliced, pre-fried, sometimes had dextrose added, was then frozen, shipped, and re-fried and then had salt added.

In June 2004, the UK's Private Eye reported that McDonald's was handing out meal vouchers, balloons, and toys to children in pediatric wards. This was especially controversial as the report was made within weeks of a British Government report stating that the present generation may be the first to die before their parents due to spiraling obesity in the British population.

Also in 2004, Morgan Spurlock's documentary film Super Size Me produced negative publicity for McDonald's, with allegations that McDonald's food was contributing heavily to the [1] epidemic of obesity in American society, and failing to provide nutritional information about its food for its customers. For 30 days Spurlock ate nothing but McDonald's (supersizing whenever asked) and by the end of the month Spurlock reported mood swings, sexual dysfunction, and had gained 24.5 pounds (11.11 kg). Subsequent to the showing of the film at the Sundance Film Festival, but before its cinematic release, McDonald's phased out its Supersize meal option and began offering several healthier menu items, though no link to the film was cited in this decision. They also began a practice of putting all nutritional information for all menu items in light grey small print on the reverse of their tray liners. Several other people later similarly ate only at McDonald's for a month, but by choosing menu items more judiciously (Spurlock ate everything on the menu at least once, always accepted upsizing requests of McDonald's employees, and continued to eat after he was full) and exercising frequently, showed no ill effects. One woman was even able to lose weight, claiming that the transparency of nutritional information made it easy to control daily caloric intake.[citation needed]

The company has progressively introduced a line of salads and vegetarian oriented items in recent years, with the result that the menu is probably now among the most varied in existence for franchised convenience restaurants of McDonald's type. However, a large amount of anecdotal evidence exists which suggests that hygiene standards with regards to food preparation can be inconsistently applied by individual McDonald's restaurants, despite the universal policy being strict.

UK adult comic, Viz, sued Mcdonalds over allegations that their top tips advertising campaign was using Top Tips from the comic without permission.

Global impact

Countries with McDonald's stores

Some observers have suggested that many of McDonald's innovations have become commonplace and are no longer seen as such, and that the company should be given credit for increasing the standard of service in markets it enters. A group of anthropologists in a study entitled Golden Arches East (Stanford University Press, 1998, edited by James L. Watson) looked at the impact McDonald's had on East Asia, and Hong Kong in particular. Among the findings were that McDonald's had solved the problem of losing face for many customers (who might be embarrassed when someone else ordered a more expensive item in a restaurant; as the food at McDonald's is all similarly priced, this ceased to be an issue). McDonald's have to a large extent (within the overarching American context) shown an unusual level of desire to cater to varying cultural requirements. The Filet-O-Fish being introduced to cater to Catholic abstinence is one example of this. However, the company at one point also became involved in controversy when it was revealed that french fries were cooked in non-kosher beef tallow, which greatly upset Islamic, Jewish, and Hindu customers, to whom it had been claimed that the fries were in fact kosher.

When it opened in Hong Kong in 1975, McDonald's was the first restaurant to consistently offer clean restrooms, driving customers to demand the same of other restaurants and institutions. By popularizing the idea of a quick restaurant meal, the study suggests, McDonald's led to the easing or elimination of various taboos, such as that on eating while walking in Japan. In most cases, McDonald's quickly became accepted, and was no longer seen as a foreign institution.

In other cases, the firm has shown itself ready to adjust its business practices. When environmentally damaging packaging and waste produced by the company's restaurants became a public concern, McDonald's started a joint project with Friends of the Earth to eliminate the use of polystyrene containers and to reduce the amount of waste produced.

Emblem of globalization

McDonald's has become emblematic of globalization, sometimes referred as the "Mcdonaldization" of society. The Economist magazine uses the "Big Mac index" (the price of a Big Mac) as an informal measure of purchasing power parity among world currencies. Thomas Friedman suggested that no countries with McDonald's had gone to war with each other. His theory ("Golden Arches" theory) seemed to have been disproved when NATO bombed Serbia in 1999, although it was pointed out in The Economist that NATO itself has no McDonald's. McDonald's remains a target of anti-globalization protesters worldwide.

McDonalds is the largest toy manufacturer and distributor in the world.

Restaurants

The first McDonald's was not a restaurant at all, but a walk-up hot dog stand. The company's early franchises were built to a standard pattern that did not offer seating; this was in part to prevent loitering. However, the potential of sit-down restaurants was clear from the beginning, and the company switched to a new standard design for sit-down restaurants in 1967, upon which current standalone restaurants are still based. The company introduced the Drive-Thru in 1975, following the lead of competitor Wendy's, rapidly adding it to existing restaurants wherever this was feasible.

A McDonald's restaurant at Forum the Shopping Mall, Orchard Road, Singapore

However useful the standard design may have been in popularizing McDonald's and making the company's restaurants instantly recognizable, it is not always possible, or appropriate, for all restaurant locations. McDonald's has often faced organized campaigns claiming it would threaten its surroundings, particularly in historic locations. Possibly in an effort for European nations to become more accepting of the McDonald's concept, the second McDonald's in Italy, opened 1986 near the Spanish Steps in Rome, is widely heralded as the most luxurious McDonald's restaurant. It features indoor fountains, marble walls and floors. Other restaurants in similarly sensitive settings have muted décor and blend into existing architecture.

McCafé

File:DSCN0164.JPG
A McDonald's with McCafé, in IFC Mall, Hong Kong.

The McCafé is a bistro-like restaurant concept by McDonald's Corporation in an effort to gain a share of the ever popular and expanding gourmet coffee market, to avoid losing market share to companies such as Starbucks. With comfortable leather chairs and couches, natural wood accents, and bistro style tables, the ambience is that of a typical modern coffee shop. Dine-in patrons forego the plastic trays and paper wrappers for the more elegant china plates and stainless steel silverware.

The menu boasts the standard bistro fare, including paninis, coffee and espresso drinks, and baked goods and pastries, and all menu items are available for take-out. House coffee blends are sold both normally and in tins for home brewing.

The concept was introduced in Australia in 1993 and has been successful in several other countries, including Ireland, Brazil, Israel, Chile, Panama, New Zealand, Colombia, Guatemala, France, Italy, Singapore, the Philippines and most recently Canada. There are 22 McCafés in Hong Kong. The concept has recently been introduced into the U.S., including a McCafé in Orlando, Florida. The first McCafé in the United States was in Raleigh, NC.

Other interesting restaurants

  • A McDonald's near Vinita, Oklahoma is situated above Interstate 44, such that it is possible to eat while cars and trucks pass underneath. The Vinita restaurant is said to be the world's largest McDonald's in terms of square footage. The following story appeared in Reader's Digest for June, 2006, p.64: "Driving through Oklahoma, my husband and I went out of our way to stop at what was billed as the largest McDonald's in the world. However, we were less than thrilled when an employee addressed everyone over the intercom, 'Attention, world's largest McDonald's customers...!'"
  • McDonald's recently won a contract with the Illinois State Toll Highway Authority to place restaurants in renovated oases, many of which are located over the tollways. (Prior to the renovations, there had been McDonald's and other chain stores on these overhead oases, which had superceded earlier restaurants, such as the once-plentiful Howard Johnson's, which had been similarly placed over the tollway.)
  • A former McDonald's in St. Louis, Missouri was a riverboat on the Mississippi River. The restaurant is now closed.
  • Sälen in Sweden opened the first ski-through McDonald's in the world.
  • A McDonald's located in East Coast Park in Singapore has a skate-thru, together with the main restaurant.
  • The McDonald's restaurant in Bray, Republic of Ireland occupies the entire former Town Hall.
  • In Israel, some McDonald's restaurants are kosher, although most are not; there is also a kosher restaurant in the Argentine capital, Buenos Aires.
  • In Dearborn, Michigan (where there is a significant Muslim population), there are two McDonald's Restaurant branches which sell halal Chicken McNuggets and McChicken Sandwiches.
  • In Moscow, Russia, a McDonald's exists that also doubles as a firehouse museum/memorial.
  • McDonald's sometimes subdues or varies its corporate image to blend in with the local environment. For example, in Sedona, Arizona, a McDonald's has "Green Arches" to fit in with the city's natural look. Similarly, one in Paris has a white McDonald's "M."
  • The 24th Street & Mission Street Mission District restaurant, San Francisco, California, has a mural inside and on the outside walls. It portrays small children from the neighborhood and was painted by Precita Eyes (a local muralist group) and the neighborhood children the mural displays.
  • The McDonald's on east Fordham Road near Webster Avenue in the Bronx is considered the birthplace of the Guardian Angels safety patrol. Angels founder Curtis Sliwa was a manager and many of the founding members of the Angels worked there in the late 1970s.
  • A McDonald's at the Guantanamo Bay Naval Base is the only store in Cuba (McDonald's is subject to the Cuban embargo). McDonald's fare has been used as a reward for prisoners in the detention camps.
  • The McDonald's in Antigonish, Nova Scotia, Canada, has the largest public art collection in the town and continually showcases art from up and coming artists of the region.
  • In a McDonald's in Ontario, Canada, murals of rolling hills, blue skies and golf greens cover the walls. A neon sign displaying "The Nineteenth Hole" is situated above the counter, referring the tradition of calling the clubhouse or bar on a golf course the "nineteenth hole".
  • A McDonald's located in the The Pentagon occupies one of the former cafeterias.
  • The most-visited McDonald's Restaurant in 1986 was located on a large floating boat at the 1986 World's Fair, hosted in Vancouver, British Columbia, Canada. The restaurant, nicknamed McBarge, now floats abandoned outside downtown Vancouver.
  • A McDonald's in New York City, located at 160 Broadway, features a doorman, marble tables, chandeliers, a private dining room with wait staff and silverware, and live music played on a baby grand piano. [3][4]
  • The McDonald's in Pompei, Italy, located near the ruins of Pompeii, features wall murals depicting Ronald McDonald, Grimace, The Fry Kids and other McDonald's characters wearing togas in a Tuscan landscape.
  • At a McDonald's in Cairo, Egypt orders are taken at a counter, however trays bearing the meal are brought by staff to customers at their table.
  • A McDonald's in Hong Kong, China, features a hostess who directs customers to the shortest line, and clients are expected to leave trays and garbage for the dedicated dining area staff to clear away.
  • In all McDonald's in Saudi Arabia the term (Hamburger) has been replaced with (Beefburger) as of 2005 since all pork products are not allowed in Saudi Arabia (even though it never contained any pork). Aside from the local specials, Saudi Arabian McDonald's feature many spin-offs to the original menu sandwiches such as a Chicken Big Mac and Spicy McChicken. As it is with all fast food restaurants in Saudi Arabia, the clients are to leave trays and garbage for the dining area staff to clear away.
  • The restaurant in Tai Wo Estate, Tai Po, Hong Kong is built outside the shopping complex and of house style. There are only 2 such restaurants in Hong Kong. (another is in Heng Fa Chuen, which is the world's 11,000th outlet)
  • McDonald's on the East Coast of Canada serve McLobster sandwiches.
Main article: McDonald's menu items

McDonald's offers a variety of fast-foods, desserts, and beverages. Some items are only specific to certain regions. In the beginning of 2006, McDonalds started printing nutrition facts on the packaging of their products after pressure from concerned individuals to include nutrition facts on the packaging, citing that the often hidden nutrition charts and pamphlets were not comprehensive enough.

McDonald's TV campaigns and slogans

Main article: McDonald's TV campaigns and slogans

To date, McDonald's has used a total of twenty-three different slogans in United States advertising, as well as a few other slogans for select countries and regions.

Hamburger University

In Oak Brook, Illinois, where the company headquarters is located, is the first Hamburger University, a school for future executive managers of regional franchises. Adjacent to the building is a McDonald's-themed hotel. Similar "Hamburger U" training schools have been set up around the world.

Corporate governance

Current members of the board of directors of McDonald's are: Hall Adams, Edward Brennan, Robert Eckert, Enrique Hernandez, Jeff Hunter, Richard Lewis, Andrew McKenna, Cary McMillan, and Michael J. Roberts.

See also

Documentaries about McDonald's Corporation

  • The emergence and evolution of McDonald's business in Japan is documented in Terry Sanders' film The Japan Project: Made in America.
  • Morgan Spurlock's diet of nothing but McDonald's for 30 days is documented in Super Size Me.
  • McLibel 2005 (remake of 'McLibel - two world's collide' (1997)) from Spanner Films http://www.spannerfilms.net/?lid=161

References

  1. ^ Greenpeace International (April-2006). "We're trashin'it, How McDonalds's is eating up the Amazon". Retrieved 2006-04-18. {{cite news}}: Check date values in: |date= (help); Unknown parameter |format= ignored (help)
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