This Week in History recalls memorable and decisive events and personalities of the past.
15th April 1955 – McDonald’s corporation dates its founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois
The McDonald’s headquarters in Chicago [Dirk Tussing, https://commons.wikimedia.org/w/index.php?curid=74002350]
The McDonald’s company today stands as one of the giants of the food industry, having 40 000 restaurants across the world and serving more than 60 million customers daily. Like many great businesses, its origins are quite humble and begin in 1940s America.
The first MacDonald’s restaurant was opened by brothers Richard and Maurice McDonald, children of Irish immigrants, in 1940 in San Bernadino, California.
Logo from 1940 until 1948
They had started out working on movie sets, but followed in their father’s footsteps after he had opened a food stand in 1938.
After eight years, the brothers realised they made most of their money from hamburgers and decided to rework their restaurant into a ‘fast food’ establishment, copying and building on the system developed by White Castle, an older restaurant chain which pioneered the modern fast-food system in the 1920s.
White Castle restaurant in the New York borough of Queens [Tdorante10, https://commons.wikimedia.org/w/index.php?curid=64033920]
The early McDonald’s menu listed hamburgers, cheeseburgers, soft drinks, milk, coffee, potato chips, and slices of pie. This new style was massively successful, and the brothers soon opened another restaurant in 1952, and, a year later, decided to open a franchise to use their version of the fast-food system in Arizona.
In 1954 a man named Ray Kroc, a milkshake mixer salesman, visited the restaurant after learning the brothers were using his machines there. He was greatly impressed, and believed the restaurant had the potential to be nationally successful.
Ray Kroc
At this time, McDonald’s had six franchises. The brothers believed their style of food service would work only in warm locations, and did not want to take the risk of rapid national expansion.
After much negotiating, Kroc managed to convince the brothers to let him expand the operation by franchise in Illinois – where he was originally from – and other places across the United States, as long as he shouldered most of the financial risk.
The first McDonald’s opened by Kroc was in Des Plaines, Illinois, on 15 April 1955. Kroc would prove to be a franchising genius, coming up with innovative new ways to sell franchises and ensuring that all McDonald’s restaurants would adhere to the same standards of cleanliness and service.
The restaurants were also only opened in suburban areas and were banned from any area Kroc thought had too much crime. Each franchise was also told to waste not a single resource, even scraping out bottles of sauce so that everything would be used.
This approach was very successful, and the company rapidly grew.
Kroc, however, often came to blows with the McDonald’s brothers, who didn’t want to open too many stores and who were very particular about the design of the restaurants.
In 1961 Kroc decided to buy out the brothers entirely, paying each of them 1 million dollars after taxes for a total sale of 2.7 million dollars (Around $24 million in today’s money). Despite claims in modern media such as in the film, The Founder, there is little evidence that this was a hostile takeover of the company by Kroc.
With full control and with a big focus on marketing, Kroc led the company to new heights. Through the 1960s McDonald’s expanded rapidly, with the first McDonald’s outside of the US opening in Canada in 1967. The first in Europe opened in 1971 in the Netherlands and the first in Australia opened later that year.
McDonald’s in Sydney [Maksym Kozlenko, https://commons.wikimedia.org/w/index.php?curid=55015547]
Kroc would retire from the day-to-day running of McDonald’s in 1973, having turned a small successful chain of restaurants into a giant globe-spanning empire.
McDonald’s in Tokyo [MiNe, https://commons.wikimedia.org/w/index.php?curid=38832396]
Today McDonald’s is the world’s second largest private employer, with over 1.7 million employees, and has a revenue of over $23 billion annually.
By 1993, McDonald’s had sold more than 100 billion hamburgers so two-digit signs were left at ‘99 billion’
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