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McDonald's
McDonald's Golden Arches.svg Public Type (NYSE: MCD) Industry Restaurants May 15, 1940 in San Bernardino, California; McDonald's Founded Corporation, April 15, 1955 in Des Plaines, Illinois Richard and Founder(s) Maurice McDonald McDonald's
Contents
1 History 2 Corporate overview 2.1 Facts and figures 2.2 Types of restaurants 2.3 Playgrounds 2.4 Redesign 2.5 Business model 2.6 Shareholder dividends 3 Controversies 3.1 Arguments in defense 3.2 Environmental record 4 Legal cases 5 Products 6 Headquarters 7 Advertising 7.1 Children's advertising 7.2 Sports awards and honors 8 Global operations 9 See also 9.1 Competitors 10 References 11 External links
History
[image][image] McDonald's Logo used from 1968 to 2003. It still exists at most of the restaurants. [image][image] "Speedee" [image][image] "Ronald" Main article: History of McDonald's The business began in 1940, with a restaurant opened by brothers Richard and Maurice McDonald in San Bernardino, California. Their introduction of the "Speedee Service System" in 1948 established the principles of the modern fast-food restaurant. The original mascot of McDonald's was a man with a chef's hat on top of a hamburger shaped head whose name was "Speedee." Speedee was eventually replaced with Ronald McDonald by 1967 when the company first filed a U.S. trademark on a clown shaped man having a puffed out costume legs. McDonald's first filed for a U.S. trademark on the name McDonald's on May 4, 1961, with the description "Drive-In Restaurant Services," which continues to be renewed through the end of December 2009. In the same year, on September 13, 1961, the company filed a logo trademark on an overlapping, double arched "M" symbol. The overlapping double arched "M" symbol logo was temporarily disfavored by September 6, 1962, when a trademark was filed for a single arch, shaped over many of the early McDonald's restaurants in the early years. The modern double arched "M" symbol that continues to be in use today at McDonald's restaurants did not appear until November 18, 1968, when the company filed a U.S. trademark on the now famous symbol that continues to be in use through the end of the year 2009. The first McDonald's restaurants opened in the United States, Canada, Costa Rica, Panama, Japan, the Netherlands, Germany, Australia, France, El Salvador and Sweden, in order of openings. The present corporation dates its founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois, on April 15, 1955[8] , the ninth McDonald's restaurant overall. Kroc later purchased the McDonald brothers' equity in the company and led its worldwide expansion, and the company became listed on the public stock markets in 1965.[9] Kroc was also noted for aggressive business practices, compelling the McDonald brothers to leave the fast food industry. The McDonald brothers and Kroc feuded over control of the
Corporate overview
Facts and figures
[image][image] McDonald's boasts its service to "99 billion customers". McDonald's restaurants are found in 119 countries[11] and territories around the world and serve nearly 47 million customers each day. McDonald's operates over 31,000 restaurants worldwide, employing more than 1.5 million people.[11] The company also operates other restaurant brands, such as Piles Caf. Focusing on its core brand, McDonald's began divesting itself of other chains it had acquired during the 1990s. The company owned a majority stake in Chipotle Mexican Grill until October 2006, when McDonald's fully divested from Chipotle through a stock exchange.[12][13] Until December 2003, it also owned Donatos Pizza. On August 27, 2007, McDonald's sold Boston Market to Sun Capital Partners.[14]
Types of restaurants
Most standalone McDonald's restaurants offer both counter service and drive-through service, with indoor and sometimes outdoor seating. Drive-Thru, Auto-Mac, Pay and Drive, 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; it was first introduced in Arizona in 1975, following the lead of other fast-food chains. 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 the "Solid Gold McDonald's," a 1950s rock-and-roll themed restaurant.[15] In Victoria, British Columbia, there is also a McDonald's with a 24-carat (100%) gold chandelier and similar light fixtures. To accommodate the current trend for high quality coffee and the popularity of coffee shops in general, McDonald's introduced McCaf, a caf-style accompaniment to McDonald's restaurants in the style of Starbucks. McCaf is a concept created by McDonald's Australia,
Playgrounds
[image][image] McDonald's in Panorama City, California designed for family-friendly image Some McDonald's in suburban areas and certain cities feature large indoor or outdoor playgrounds. The first PlayPlace with the familiar crawl-tube design with ball pits and slides was introduced in 1987 in the USA, with many more being constructed soon after. Some PlayPlace playgrounds have been renovated into "R Gym" areas.
Redesign
In 2006, McDonald's introduced its "Forever Young" brand by redesigning all of their restaurants, the first major redesign since the 1970s.[18][19] The design includes the traditional McDonald's yellow and red colors, but the red is muted to terra cotta, the yellow was turned golden for a more "sunny" look, and olive and sage green were also added. To warm up their look, the restaurants have less plastic and more brick and wood, with modern hanging lights to produce a softer glow. Contemporary art or framed photographs hang on the walls.
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 remainder are operated by others through a variety of franchise agreements and joint ventures. The McDonald's Corporation's business model is slightly different from that of most 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 collect rent, which may also be calculated on the basis of sales. As a condition of many 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. The UK business model is different, in that fewer than 30% of restaurants are franchised,
Shareholder dividends
McDonald's has increased shareholder dividends for 25 consecutive years,[20] making it one of the S&P 500 Dividend Aristocrats.[21][22]
Controversies
As a prominent example of the rapid globalization of the American fast food industry, McDonald's is often the target of criticism for its menu, its expansion, and its business practices. The McLibel Trial, also known as McDonald's Restaurants v Morris & Steel, is an example of this criticism. In 1990, activists from a small group known as London Greenpeace (no connection to the international group Greenpeace) distributed leaflets entitled What's wrong with McDonald's?, criticizing its environmental, health, and labor record. The corporation wrote to the group demanding they desist and apologize, and, when two of the activists refused to back down, sued them for libel in one of the longest cases in British civil law. A documentary film of the McLibel Trial has been shown in several countries. Despite the objections of McDonald's the term "McJob" was added to Merriam-Webster's Collegiate Dictionary in 2003.[23] Defined as "a low-paying job that requires little skill and provides little opportunity for advancement".[24] In an open letter to Merriam-Webster, Jim Cantalupo, former CEO of McDonald's, denounced the definition as a "slap in the face" to all restaurant employees, and stated that "a more appropriate definition of a 'McJob' might be 'teaches responsibility.'" Merriam-Webster responded that "we stand by the accuracy and appropriateness of our definition."[25] In 1999, French anti-globalisation activist Jos Bov vandalized a half-built McDonald's to protest against the introduction of fast food in the region.[26]
Arguments in defense
In response to public pressure, McDonald's has sought to include more healthy choices in its menu and has introduced a new slogan to its recruitment posters: "Not bad for a McJob".[29] (The word McJob, first attested in the mid-1980s[30] 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 the idea. In 2007, the company launched an advertising campaign with the slogan "Would you like a career with that?" on Irish television, outlining that their jobs have many prospects. In a bid to tap into growing consumer interest in the provenance of food, the fast-food chain recently switched its supplier of both coffee beans and milk. UK chief executive Steve Easterbrook said: "British consumers are increasingly interested in the quality, sourcing and ethics of the food and drink they buy". McDonald's coffee is now brewed from beans taken from stocks that have been certified by the Rainforest Alliance, a conservation group. Similarly, milk supplies used for its hot drinks and milkshakes have been switched to organic sources which could account for 5% of the UK's organic milk output.[31] McDonald's announced on May 22, 2008 that, in the U.S. and Canada, it will be introducing cooking oil for its french fries that contains no trans fats. The company will use canola-based oil with corn and soy oils by year's end for its baked items, pies and cookies.[32][33]
Environmental record
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 businesses with legal action unless they drop the Mc or Mac from their trading name. In one noteworthy case, McDonald's sued a Scottish caf owner called McDonald, even though the business in question dated back over a century (Sheriff Court Glasgow and Strathkelvin, November 21, 1952). On September 8, 2009, McDonald's Malaysian operations lost a lawsuit to prevent another restaurant calling itself McCurry. McDonald's lost in an appeal to Malaysia's highest court, the Federal Court.[44] It has also filed numerous defamation suits. For example, in the McLibel case, McDonald's sued two activists for distributing pamphlets attacking its environmental, labor and health records. After the longest trial in UK legal history, McDonald's won a technical victory for showing that some allegations were untrue. The McLibel Case was also a massive public relations disaster for McDonald's, as the judge also found that while more than half of what was on the pamphlet was truthful, much of the information simply the opinions of the activists and therefore non-prosecutable. McDonald's has defended itself in several cases involving workers' rights. In 2001 the company 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 (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 in one of its outlets and was fined AU$8,000.[45] Possibly the most infamous legal case involving McDonald's was the 1994 decision in The McDonald's Coffee Case. In a McDonald's American Idol figurine promotion, the figurine that represents "New Wave Nigel" wears something that closely resembles Devos Energy Dome, which was featured on the band's album cover, Freedom of Choice. In addition to the figurine's image, it also plays a tune that appears to be an altered version of Devo's song "Doctor Detroit." Devo copyrighted and trademarked the Energy Dome and is taking legal action against McDonald's.[46]
Products
[image][image] A McDonald's Big Mac combo meal served with French fries and Coca-Cola. Main article: McDonald's products
Headquarters
[image][image] McDonald's Plaza, the headquarters of McDonald's The McDonald's headquarters complex, McDonald's Plaza, is located in Oak Brook, Illinois. It sits on the site of the former headquarters and stabling area of Paul Butler, the founder of Oak Brook.[47] McDonald's moved into the Oak Brook facility from an office within the Chicago Loop in 1971.[48]
Advertising
Main article: McDonald's advertising McDonald's has for decades maintained an extensive advertising campaign. In addition to the usual media (television, radio, and newspaper), the company makes significant use of billboards and signage, sponsors sporting events ranging from Little League to the Olympic Games, and makes coolers of orange drink with their logo available for local events of all kinds. Nonetheless, television has always played a central role in the company's advertising strategy. To date, McDonald's has used 23 different slogans in United States advertising, as well as a few other slogans for select countries and regions. At times, it has run into trouble with its campaigns.
Children's advertising
Main articles: Ronald McDonald and McDonaldland
Global operations
[image][image] Countries with McDonald's stores McDonald's has become emblematic of globalization, sometimes referred to as the "McDonaldization" of society. The Economist magazine uses the "Big Mac Index": the comparison of a Big Mac's cost in various world currencies can be used to informally judge these currencies' purchasing power parity. Scandinavian countries lead the Big Mac Index with four of the five most expensive Big Mac's. Norway has the most expensive Big Mac in the world as of July 2008, whilst the cheapest country is Malaysia. Thomas Friedman once said that no country with a McDonald's had gone to war with another.[49][Full citation needed] However, the "Golden Arches Theory of Conflict Prevention" is not strictly true. Exceptions are the 1989 United States invasion of Panama, NATO's bombing of Serbia in 1999, the 2006 Lebanon War, and the 2008 South Ossetia war. Some observers have suggested that the company should be given credit for increasing the standard of service in markets that it enters. A group of anthropologists in a study entitled Golden Arches East[50] looked at the impact McDonald's had on East Asia, and Hong Kong in particular. 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. McDonald's have recently taken to partnering up with Sinopec, China's second largest oil company, in the People's Republic of China, as it begins to take advantage of China's growing use of personal vehicles by opening numerous drive-thru restaurants.[51] McDonald's reached a deal with the French fine arts museum, the Louvre, to open a McDonald's restaurant and McCaf on its premises,by their underground entrance, in November 2009.[52] See also: List of countries with McDonald's franchises
See also
[image]Chicago portal [image]Companies portal [image]Food portal Wikimedia Commons has media related to: McDonald's Wikiquote has a collection of quotations related to: McDonald's Corporation
Fast Food Nation, book by Eric Schlosser MaDonal, a restaurant knock-off operating in Northern Iraq . Maxime, McDuff & McDo, documentary film about the unionizing of a McDonald's in Montreal, Quebec, Canada. McDonaldization, term used by sociologist George Ritzer to describe the process by which a society takes on the characteristics of a fast-food restaurant. McDonald's Video Game, a satirical game placing the player in the role of McDonald's management. Don Gorske, a McDonald's enthusiast, has consumed over 20,000 Big Mac hamburgers. He appeared on Super Size Me, is listed in the Guinness Book of World Records, and has a movie called MacDaddy. Super Size Me, a documentary by Morgan Spurlock.
Competitors
Burger King - Second largest burger chain Subway (restaurant) - Largest single brand restaurant chain Yum! - Largest multi-brand restaurant chain
References
1. ^ McDonald's publication. "Corporate FAQ". McDonald's Corporation. http://www.mcdonalds.ca/en/aboutus/faq.aspx. Retrieved 2007-11-24. 2. ^ a b c d e Overview of McDonald's key financial metrics via Wikinvest, retrieved 9/28/2009 3. ^ Joe Bramhall. "McDonald's Corporation". Hoovers. http://www.hoovers.com/mcdonald's/--ID__10974--/free-co-factsheet.xhtml. Retrieved 2009-03-25. 4. ^ "www.breitbart.com/article.php?id=CNG.aec4920fe8094fdd0baaeab2ed126bf1.741&sho w_article=1". http://www.breitbart.com/article.php?id=CNG.aec4920fe8094fdd0baaeab2ed126bf1.741 &show_article=1. 5. ^ "Chipotle, McDonald's Complete Separation". http://phx.corporate-ir.net/phoenix.zhtml?c=194775&p=irol-newsArticle&ID=916004&hig hlight. 6. ^ "MCD 10-K 2007, Item 1, pg. 1".
External links
Look up mcdonald's in Wiktionary, the free dictionary. Official U.S. McDonald's site. Photographs of McDonald's storefronts from around the world. "Big Mac's Makeover: McDonald's Turned Around". The Economist. 2004-10-14. http://www.economist.com/business/displaystory.cfm?story_id=E1_PNRVRJR. Retrieved 2008-04-08.
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