HISTORY OF THE BUSINESS

McDonald's
AMERICAN CORPORATION
Alternative Title: McDonald’s Corporation
McDonald’s, in full McDonald’s Corporation, American fast-food chain that is one
of the largest in the world, known for its hamburgers. Its headquarters are in Oak
Brook, Illinois.
The first McDonald’s restaurant was started in 1948 by brothers Maurice (“Mac”)
and Richard McDonald in San Bernardino, California. They bought appliances for their
small hamburger restaurant from salesman Ray Kroc, who was intrigued by their need for
eight malt and shake mixers. When Kroc visited the brothers in 1954 to see how a small shop
could sell so many milkshakes, he discovered a simple, efficient format that permitted the
brothers to produce huge quantities of food at low prices. A basic hamburger cost 15 cents,
about half the price charged by competing restaurants. The self-service counter eliminated the
need for waiters and waitresses; customers received their food quickly because hamburgers
were cooked ahead of time, wrapped, and warmed under heat lamps.
Seeing great promise in their restaurant concept, Kroc offered to begin a franchise
program for the McDonald brothers. On April 15, 1955, he opened the first McDonald’s
franchise in Des Plaines, Illinois, and in the same year launched the McDonald’s Corporation,
eventually buying out the McDonald brothers in 1961. The number of McDonald’s outlets
would top 1,000 before the end of the decade. Boosted by steady growth, the company’s
stock began trading publicly in 1965.
The public face of McDonald’s was created in 1963 with the introduction of a clown
named Ronald McDonald, while the double-arch “m” symbol became McDonald’s most
enduring logo in 1962, lasting far longer than the tall yellow arches that had once dominated
the earlier restaurant rooftops. Other products and symbols would define the McDonald’s
brand, including the Big Mac (1968), the Egg McMuffin (1973), Happy Meals (1979), and
Chicken McNuggets (1983).
The chain continued to expand domestically and internationally, extending to Canada
in 1967, reaching a total of 10,000 restaurants by 1988, and operating more than 35,000
outlets in more than 100 countries in the early 21st century. Growth was so swift in the 1990s
that it was said a new McDonald’s opened somewhere in the world every five hours. It
effectively became the most popular family restaurant, emphasizing affordable food, fun, and
flavours that appealed to children and adults alike.
The success of McDonald’s brought increased criticism, much of which concerned its
perceived association with a global increase in obesity. McDonald’s responded by adding
healthy items to its menu, and in 2017 it began testing a vegan hamburger. During this time it
also eliminated supersized portions, and its U.S. and Canadian restaurants stopped using
trans-fat oil in a number of items. Such measures, however, did little to stem health concerns.
In addition, as one of the world’s largest private employers, McDonald’s faced numerous
calls to increase wages. The term McJob was added to the Merriam-Webster dictionary to
mean “low-paying job.”
In the late 20th century, McDonald’s moved beyond the hamburger business by acquiring
Chipotle Mexican Grill (1998), Donatos Pizza (1999), and Boston Market (2000) in
the United States, and in the United Kingdom McDonald’s purchased Aroma Cafe (1999) and
an interest in Pret A Manger (2001), a sandwich restaurant chain. However, by late 2008
McDonald’s no longer owned or had a stake in any of those companies, instead
concMcDonald’s was active in charitable work. In 1974 it joined Philadelphia Eagles football
player Fred Hill, whose daughter had been diagnosed with leukemia, in founding the Ronald
McDonald House in Philadelphia. The residence allowed families to live near the hospital
where their children were receiving treatment. By the early 21st century, more than 360 such
houses existed around the world. The Ronald McDonald House Charities (established 1987)
also supports various other efforts.entrating on its own brand. he world famous Golden
Arches arrived in the Philippines in 1981 when Dr. George T. Yang opened the first-ever
McDonald’s restaurant in the country. The historic restaurant still stands on its original
location in Morayta, Manila. In 1992, McDonald’s brought its world famous menu items like
Big Mac and Fries closer to more Filipinos with the opening of its first stores in Visayas and
Mindanao. 35 years since it first arrived in Philippine shores, McDonald's became a 100%
Filipino-owned company in 2005—fulfilling its vision to become ‘Una Sa Pamilyang
Pinoy’. Today, McDonald’s has grown to become one of the country’s leading fast food
chains with more than 480 restaurants nationwide. With President and Chief Executive
Officer Kenneth S. Yang at the helm, McDonald’s is now a multibillion-Peso company, with
over 40,000 employees serving Filipinos all over the Philippines. McDonald’s strives to
deliver quality service and a delightful customer experience. Our employees enjoy a dynamic
working environment, support, training and opportunities to help them deliver the best
possible results and advance their career. Apart from the company's commitment to serving
and delighting its customers and employees, McDonald’s is also dedicated to making a
difference in the lives of Filipino children and families through its charity of choice, Ronald
McDonald House Charities and its banner programs: Ronald McDonald Read to Learn, a
beginning reading program for Grade 1 public school students, “Ronald McDonald Bahay
Bulilt”, a program that builds low-cost day care centers for children aged 2-5 years old, and
“Bigay Tulong”, a program to provide immediate aid to affected families during natural
calamities.

CURRENT STATUS AND DEVELOPMENT OF THE BUSINESS

McDonald’s (NYSE: MCD) released its full year results on January 30, 2019. The
company beat the consensus earnings but missed slightly on revenue for the 4thQuarter. This
is primarily due to the refranchising of its restaurants that the company has been undertaking
for a couple of years. The company’s long-term goal is for 95% of McDonald’s restaurants to
be owned by franchisees, and at the end of FY 2018, this figure stood at 92.7%. Overall the
company posted revenue of $21.03 billion with earnings of $7.50, up 18% year on year as the
strategy has also helped them in cutting down costs and thus improving margins. Global
comparable sales also improved by 4.5% YOY.

GLOBALIZATION OR "MCDONALDIZATION"

Annual Global Revenue of McDonald's from 2006 to 2014

From the early stages of barely reaching the brink of simply one billion US dollars
as a total revenue, of December 2014, the total global revenue was 27.44 billion USD
(US dollars) and hit one of it’s greatest peaks in 2013 with a global revenue of 28.11
billion USD.
 Three McDonald's workers at a franchise in Montreal in 1974.
In fact, it is common to visualize which countries are rather wealthy and which are
not as wealthy in terms of McDonald’s, which is rather impressive. As any other
wise corporation would, McDonald’s seems to map their restaurants on the money,
or the countries with stable economies. There are still approximately 105 countries
without McDonald’s such as Cambodia, Ghana, Montenegro, and Yemen, in which
a bulk of the countries without McDonald’s are at the bottom of the worldwide
economic rankings. McDonald’s once had a presence in six other countries, but due
to economic issues, the franchises closed.

In addition, approximately 1.9 million people work for McDonald’s and its
franchises, which means that in a sense, the corporation opens up several job
opportunities for the world itself as it expands globally.

The very first McDonald's franchise in Japan open in 1971.

About 80% of the restaurants themselves are franchised, meaning that they are
restaurants that are owned and operated by independent businessmen and women.
With such incredible statistics, McDonald’s is the leading global food service
retailer and is growing by the minute to expand and create new job opportunities in
countries that already have or do not have McDonald’s.

In a book by George Ritzer called, The McDonaldization of Society, Ritzer coined

the term “McDonaldization,” meaning the increased dominance of fast food,
predominantly McDonald’s, in societies around the world. It is widely debated that
McDonald’s “Americanizes” other cultures

McDonald's supply chain in India

Being very mindful of such a fear of McDonald’s “Americanizing” other
countries, as a multinational corporation, it takes several measures in order to try
and reduce the fears. Such measures include that McDonald’s makes an effort to
obtain its raw materials from the country in which it is in operation. For example,
prior to opening its first restaurant in India, McDonald’s began to train Indian
farmers several years beforehand to plant and grow iceberg lettuce. Such a system
makes it possible for McDonald’s to obtain the necessary materials to properly run
the business while still enhancing the economy of the foreign countries.

In addition, McDonald’s appoints managerial duties to people local to a country

and an area, which generates a sense of cooperation and teamwork between
America and the foreign country and offers McDonald’s first hand insights into the
procedures and customs of a country.
McDonald’s has taken to reduce the fears of the corporation “Americanizing."