Fast food giant McDonald’s first restaurant started out featuring slow-cooked barbecued beef, ham, or pork sandwiches with French fries. The menu also offered “everything from tamales and chili to peanut butter and jelly sandwiches to ham and baked beans” and an “aristocratic hamburger”.
When it became obvious that hamburgers were their bestsellers, founders Maurice and Richard McDonald closed the restaurant for three months. They overhauled their business to a self-service restaurant with assembly line production based on specific tasks with many items preassembled. The menu offered only “hamburgers, cheeseburgers, three soft drink flavors in one 12-ounce size, milk, coffee, potato chips and pie.” The new restaurant focused on speed, lower prices, and volume. However, the real success for McDonald’s began only with the brothers replaced potato chips with French fries and added triple-thick milkshakes. Franchises followed in California and Arizona.
Ray Kroc bought the rights to franchise McDonald’s across the country. His first retaurant opened in 1955 in Des Plaines, Illinois. He kept the assembly line, but added automation, standardization, and discipline. New franchisees owners attened Hamburger University in Elk Grove, Illinois. Frank Turner established Hamburger University and wrote the training manual. He succeeded Kroc as chairman.
McDonald’s sales began to fall with competition, nutritional concerns, labor violations, and concerns about cutting rainforests for beef production. In 2007, McDonald’s began expanding its menu. This expansion led to unhappy customers, unhappy franchise owners, and lower sales.
McDonald’s sustained its success “by simply reverting to being McDonald’s again.” Those values were value, quality, and simplicity.
McDonald’s returned to its spectacular success by driving costs so low it could introduce the dollar menu, focusing on food quality and cleanliness, then adding just a few new items to the menu, such as salads and coffee. McDonald’s began removing antibiotics and other ingredients and launched a program to advance sustainable beef production. McDonald’s also returned power to franchise owners. “By putting more restaurants in the hands of our best owner/operators, we’re getting closer to the communities and customers we serve,” CEO Steve Easterbrook.
“The result? From a low of about $12 a share and rampant fears that health-conscious consumers were abandoning the restaurant to a stock price of over $67 and acknowledged leadership in the global restaurant wars.”
“Biggest Corporate Comebacks”
June 22, 2010
“McDonald’s Is Cutting A Ton Of Menu Items”
December 10, 2014
“7 mistakes that led to McDonald’s downfall”
May 4, 2015,
“Greenpeace: McDonald’s Fueling Rainforest Destruction”
April 07, 2006
“McDonald’s slide continues as it finalizes plans for turnaround”
April 22, 2015
“Why McDonald’s Is Banking On Sustainable Beef”
October 16, 2015
Paula M. Kramer
Resource Rock Star (See websites below.)
All rights reserved.
Posts on this blog alternate with posts at the link below. Posts for both blogs are published on Wednesdays as they are ready to be published. Time between posts could be weeks.
Keep reading this blog for examples of 7 successes & 7 failures + soured success. Use the examples to:
Choose success instead of failure for yourself.
Recognize when other people are choosing failure for you.
Positive Peer Pressure Poster
Resource Rock Star Details