McDonald's

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McDonald's

Type Public (NYSE: MCD)

Industry Restaurants
May 15, 1940 in San Bernardino,
California;
Founded
McDonald's Corporation, April 15, 1955 in
Des Plaines, Illinois
Richard and Maurice McDonald
McDonald's restaurant concept;
Founder(s)
Ray Kroc, McDonald's Corporation
founder.
Headquarters Oak Brook, Illinois, U.S.
Number of
31,000+ worldwide[1]
locations
Area served Worldwide
James A. Skinner
Key people
(Chairman & CEO)

Products Fast food

(hamburgers • chicken • french fries • soft
drinks • coffee • milkshakes • salads •
 desserts • breakfast)
Revenue ▲ US$ 22.6 billion (FY 2008)[2]
Operating
▲ US$ 6.51 billion (FY 2008)[2]
income
Net income ▲ US$ 4.31 billion (FY 2008)[2]
Total assets ▲ US$ 29.2 billion (Q2 2009)[2]
Total equity ▲ US$ 13.2 billion (Q2 2009)[2]
Employees 400,000 (2008)[3]
McDonalds.com
Website
This box: view • talk • edit

McDonald's Corporation (NYSE: MCD) is one of the world's largest chain of

hamburger fast food restaurants, serving nearly 47 million customers daily.[4]

In addition to its signature restaurant chain, McDonald’s Corporation held a minority

interest in Pret A Manger until 2008, was a major investor in the Chipotle Mexican
Grill until 2006,[5] and owned the restaurant chain Boston Market until 2007.[6]

A McDonald's restaurant is operated by either a franchisee, an affiliate, or the

corporation itself. The corporation's revenues come from the rent, royalties and fees
paid by the franchisees, as well as sales in company-operated restaurants. McDonald's
revenues grew 27% over the three years ending in 2007 to $22.8 billion, and 9%
growth in operating income to $3.9 billion.[7]

McDonald's primarily sells hamburgers, cheeseburgers, chicken products, french

fries, breakfast items, soft drinks, shakes, and desserts. In response to obesity trends
in Western nations and in the face of criticism over the healthiness of its products, the
company has modified its menu to include alternatives considered healthier such as
salads, wraps and fruit.

Contents
[hide]

• 1 History
• 2 Corporate overview
o 2.1 Facts and figures
o 2.2 Types of restaurants
o 2.3 Playgrounds
o 2.4 Redesign
o 2.5 Business model
o 2.6 Shareholder dividends
• 3 Controversies
o 3.1 Arguments in defense
o 3.2 Environmental record
 • 4 Legal cases
• 5 Products
• 6 Headquarters
• 7 Advertising
o 7.1 Children's advertising
o 7.2 Sports awards and honors
• 8 Global operations
• 9 See also
o 9.1 Competitors
• 10 References
• 11 External links

o 11.1 Multimedia

History

McDonald's Logo used from 1968 to 2003. It still exists at most of the restaurants.

"Speedee"

"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 business, as documented in both Kroc's
autobiography and in the McDonald brothers' autobiography. The site of the
McDonald brothers' original restaurant is now a monument.[10]

With the expansion of McDonald's into many international markets, the company has
become a symbol of globalization and the spread of the American way of life. Its
prominence has also made it a frequent topic of public debates about obesity,
corporate ethics and consumer responsibility.

Corporate overview
Facts and figures

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 Café.

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 McCafé, a café-style accompaniment to
McDonald's restaurants in the style of Starbucks. McCafé is a concept created by
McDonald's Australia, starting with Melbourne in 1993. Today, most McDonald's in
Australia have McCafés located within the existing McDonald's restaurant. In
Tasmania, there are McCafés in every store, with the rest of the states quickly
following suit. After upgrading to the new McCafe look and feel, some Australian
stores have noticed up to a 60% increase in sales. As of the end of 2003 there were
over 600 McCafés worldwide.

Some locations are connected to gas stations/convenience stores,[16] while others

called McExpress have limited seating and/or menu or may be located in a shopping
mall. Other McDonald's are located in Wal-Mart stores. McStop is a location targeted
at truckers and travelers which may have services found at truck stops.[17]

Playgrounds
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, with the majority under the ownership of the company. McDonald's trains
its franchisees and others at Hamburger University in Oak Brook, Illinois.

In other countries, McDonald's restaurants are operated by joint ventures of

McDonald's Corporation and other, local entities or governments.
As a matter of policy, McDonald's does not make direct sales of food or materials to
franchisees, instead organizing the supply of food and materials to restaurants through
approved third party logistics operators.

According to Fast Food Nation by Eric Schlosser (2001), nearly one in eight workers
in the U.S. have at some time been employed by McDonald's. (According to a news
piece on Fox News this figure is one in ten.) 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 selection of meats McDonald's uses
varies with the culture of the host country.

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 José Bové vandalized a half-built

McDonald's to protest against the introduction of fast food in the region.[26]

In 2001, Eric Schlosser's book Fast Food Nation included criticism of the business
practices of McDonald's. Among the critiques were allegations that McDonald's
(along with other companies within the fast food industry) uses its political influence
to increase its profits at the expense of people's health and the social conditions of its
workers. The book also brought into question McDonald's advertisement techniques
in which it targets children. While the book did mention other fast-food chains, it
focused primarily on McDonald's.

In 2002, vegetarian groups, largely Hindu and Buddhist, successfully sued

McDonald's for misrepresenting their French fries as vegetarian.[27]

Morgan Spurlock's 2004 documentary film Super Size Me said that McDonald's food
was contributing to the epidemic of obesity in society, and that the company was
failing to provide nutritional information about its food for its customers. Six weeks
after the film premiered, McDonald's announced that it was eliminating the super size
option, and was creating the adult happy meal.

The soya that is fed to McDonald’s chickens is supplied by agricultural giant Cargill
and comes directly from Brazil. Greenpeace alleges that not only is soya destroying
the Amazon rain forest in Brazil, but soya farmers are guilty of further crimes
including slavery and the invasion of indigenous peoples’ lands. The allegation is that
McDonald's, as a client of Cargill's, is complicit in these activities.[28]

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
Discarded fast food packaging contributes to the urban litter problem in cities
worldwide

In April 2008, McDonald's announced that 11 of its Sheffield restaurants have been
using a biomass trial that had cut its waste and carbon footprint by half in the area. In
this trial, waste from the restaurants were collected by Veolia Environmental Services
and used to produce energy at a power plant. McDonald's plans to expand this project,
although the lack of biomass power plants in the U.S. will prevent this plan from
becoming a national standard anytime soon.[34] In addition, in Europe, McDonald's has
been recycling vegetable grease by converting it to fuel for their diesel trucks.[35]

Furthermore, McDonald's has been using a corn-based bioplastic to produce

containers for some of their products. Although industries who use this product claim
a carbon savings of 30% to 80%, a Guardian study shows otherwise. The results show
that this type of plastic does not break down in landfills as efficiently as other
conventional plastics. The extra energy it takes to recycle this plastic results in a
higher output of greenhouse gases. Also, the plastics can contaminate waste streams,
causing other recycled plastics to become unsaleable.[36]

The U.S. Environmental Protection Agency has recognized McDonald's continuous

effort to reduce solid waste by designing more efficient packaging and by promoting
the use of recycled-content materials.[37] McDonald's reports that they are committed
towards environmental leadership by effectively managing electric energy, by
conserving natural resources through recycling and reusing materials, and by
addressing water management issues within the restaurant.[38]

In an effort to reduce energy usage by 25% in its restaurants, McDonald's opened a

prototype restaurant in Chicago in 2009 with the intention of using the model in its
other restaurants throughout the world. Building on past efforts, specifically a
restaurant it opened in Sweden in 2000 that was the first to intentionally incorporate
green ideas, McDonald's designed the Chicago site to save energy by incorporating
old and new ideas such as managing storm water, using skylights for more natural
lighting and installing some partitions and tabletops made from recycled goods.[39]

When McDonald’s received criticism for its environmental policies in the 1970s, it
began to make substantial progress towards source reductions efforts.[40] For instance,
an “average meal” in the 1970s—a Big Mac, fries, and a drink—required 46 grams of
packaging; today, it requires only 25 grams, allowing a 46% reduction.[41] In addition,
McDonald’s eliminated the need for intermediate containers for cola by having a
delivery system that pumps syrup directly from the delivery truck into storage
containers, saving two million pounds of packaging annually.[42] Overall, weight
reductions in packaging and products, as well as the increased usage of bulk
packaging ultimately decreased packaging by 24 million pounds annually.[43]

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 café 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 Devo’s 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
A McDonald's Big Mac combo meal served with French fries and Coca-Cola.
Main article: McDonald's products
See also: McDonald's products (international)

McDonald's predominantly sells hamburgers, various types of chicken sandwiches

and products, French fries, soft drinks, breakfast items, and desserts. In most markets,
McDonald's offers salads and vegetarian items, wraps and other localized fare.
Portugal is the only country with McDonald's restaurants serving soup. This local
deviation from the standard menu is a characteristic for which the chain is particularly
known, and one which is employed either to abide by regional food taboos (such as
the religious prohibition of beef consumption in India) or to make available foods
with which the regional market is more familiar (such as the sale of McRice in
Indonesia).

Headquarters

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

Sports awards and honors

See Category:McDonald's High School All-Americans

Global operations

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 McCafé on its premises,by their underground entrance, in November
2009.[52]

See also: List of countries with McDonald's franchises

See also
Chicago portal

Companies portal

Food portal

Wikimedia Commons has media related to: McDonald's

Wikiquote has a collection of quotations related to: McDonald's Corporation

Book:McDonald's
Books are collections of articles that can be downloaded or ordered in print.

• 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
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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.
Multimedia

• CBC Archives CBC Television reports on the opening of Moscow

McDonald's (1990).