The Evolution of the Quick Service Restaurant
The Quick Service Restaurant responds to the universal desire for inexpensive and
reliable fare that is freshly prepared, portable and ready on demand.
People were finding ways to escape the dinner table long before the 4th Earl of
Sandwich wrapped dried meat in bread c. 1762 so as not to interrupt his work or his
gambling (accounts vary). Cornish pasties and their descendants go back at least as
far as the 13th century; the South Asian samosa is believed to date to the tenth
century.
In 1867, Charles Feltman, a German butcher, opened up the first Coney Island hot dog
stand in Brooklyn, New York, though the origin of the term is in dispute. The World's
Columbian Exposition of 1893 (Chicago) and the St. Louis World's Fair of 1904 are
credited with mass promotion of a number of portable foods, including the hot dog,
the ice cream cone and iced tea.
The "diner" concept dates back to 1872, when Walter Scott of Providence, RI outfitted
a horse-drawn lunch wagon with a simple kitchen so that he could bring hot dinners to
workers.
As automobiles became popular and affordable following the First World War, drive-in
restaurants were introduced.
Walter Anderson built the first White Castle in Wichita, KS in 1916, introducing the
limited menu, high volume, low cost, high speed hamburger restaurant. Partnering
with Billy Ingram in 1921, they formed the first hamburger chain. Featuring a grill and
a fryer that was open to customers' viewing, the restaurants were designed to build
confidence in the notion that low cost could coincide with high product quality. A and
W Root Beer took its product out of the soda fountain and into a roadside stand in
1919 and began franchising its syrup in 1921. Howard Johnson pioneered the concept
of franchising restaurants in the mid-1930's, formally standardizing menus, signage
and advertising.
Wichita, KS was the home of another fast food innovation, the "Valentine Diner", a
portable steel sandwich shop introduced by Arthur Valentine in 1938. Valentines could
be purchased with a low down payment and financed through a lock box into which
the owner was to deposit 50 cents daily. Circuit riders stopped by monthly to collect
this fee; deadbeats discovered that their wagons had been hauled away.
Curb service was introduced in the late 1920's and was mobilized in the 1940's when
carhops strapped on roller skates. The term "fast-food" was coined in 1951, the same
year the drive-through window and speaker system was introduced to chain
restaurants by Jack-in-the-Box in San Diego, CA.
It is interesting to note that the fast food leader, McDonald's, did not embrace the
drive-through window until 1975. It now accounts for approximately 60% of sales.
Fast food
Fast food is the term given to food that is prepared and served very quickly, first popularized in
the 1950s in the United States. While any meal with low preparation time can be considered fast
food, typically the term refers to food sold in a restaurant or store with preheated or precooked
ingredients, and served to the customer in a packaged form for take-out/take-away. Fast food
restaurants are traditionally separated by their ability to serve food via a drive-through. The term
"fast food" was recognized in a dictionary by Merriam–Webster in 1951.
Outlets may be stands or kiosks, which may provide no shelter or seating,[1] or fast food
restaurants (also known as quick service restaurants). Franchise operations that are part of
restaurant chains have standardized foodstuffs shipped to each restaurant from central locations
Business
In the United States, consumers spent $160 billion on fast food in 2012 (up from $6 billion in
1970).[13][14] In total the US restaurant industry had projected sales of $660.5 billion in 2013.[15]
Fast food has been losing market share to fast casual dining restaurants, which offer more robust
and expensive cuisines.
Employment
According to the U.S. Bureau of Labor Statistics, about 4.1 million U.S. workers are employed
in food preparation and serving (including fast food) as of 2010.[11] The BLS's projected job
outlook expects average growth and excellent opportunity as a result of high turnover. However,
in April 2011, McDonald's hired approximately 62,000 new workers and received a million
applications for those positions—an acceptance rate of 6.2%.[17] The median age of workers in
the industry in 2013 was 28.[1
McDonald's
The McDonald's Corporation is the world's largest chain of hamburger fast food restaurants,
serving around 68 million customers daily in 119 countries.[4][5] Headquartered in the United
States, the company began in 1940 as a barbecue restaurant operated by Richard and Maurice
McDonald; in 1948 they reorganized their business as a hamburger stand using production line
principles. Businessman Ray Kroc joined the company as a franchise agent in 1955. He
subsequently purchased the chain from the McDonald brothers and oversaw its worldwide
growth.[6]
A McDonald's restaurant is operated by either a franchisee, an affiliate, or the corporation itself.
McDonald's Corporation revenues come from the rent, royalties, and fees paid by the
franchisees, as well as sales in company-operated restaurants. In 2012, McDonald's Corporation
had annual revenues of $27.5 billion, and profits of $5.5 billion.[7]
McDonald's primarily sells hamburgers, cheeseburgers, chicken, french fries, breakfast items,
soft drinks, milkshakes, and desserts. In response to changing consumer tastes, the company has
expanded its menu to include salads, fish, wraps, smoothies, and fruit.[8][9]
History
The business began in 1940, with a restaurant opened by brothers Richard and Maurice
McDonald at 1398 North E Street at West 14th Street in San Bernardino, California (at
34.1255°N 117.2946°W). Their introduction of the "Speedee Service System" in 1948 furthered
the principles of the modern fast-food restaurant that the White Castle hamburger chain had
already put into practice more than two decades earlier. 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 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[clarification needed] 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. Although
the "Golden Arches" appeared in various forms, the present form as a letter "M" did not appear
until November 18, 1968, when the company applied for a U.S. trademark.
The present corporation dates its founding to the opening of a franchised restaurant by Czech
American businessman Ray Kroc, in Des Plaines, Illinois, on April 15, 1955, 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. 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 San Bernardino store was demolished in 1976 (or 1971, according
to Juan Pollo) and the site was sold to the Juan Pollo restaurant chain. It now serves as
headquarters for the Juan Pollo chain, as well as a McDonald's and Route 66 museum.[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.
Headquarters
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.[11]
McDonald's moved into the Oak Brook facility from an office within the Chicago Loop in 1971.[12]
Products
Main article: List of 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. On a seasonal basis, McDonald's
offers the McRib sandwich. Some speculate the seasonality of the McRib adds to its appeal.[13]
Various countries, especially in Asia, are currently 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, or Ebi (prawn) Burger in Singapore). In
Germany and other Western European countries, McDonald's sells beer. In New Zealand,
McDonald's sells meat pies, after the local affiliate partially relaunched the Georgie Pie fast food
chain it bought out in 1996.
Corporate overview
Facts and figures
McDonald's restaurants are found in 118 countries[14] and territories around the world and serve
68 million customers each day.[4] McDonald's operates over 34,000 restaurants worldwide,
employing more than 1.7 million people.[14] 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.[15][16] Until
December 2003, it also owned Donatos Pizza. On August 27, 2007, McDonald's sold Boston
Market to Sun Capital Partners.[17]
Notably, McDonald's has increased shareholder dividends for 25 consecutive years,[18] making it
one of the S&P 500 Dividend Aristocrats.[19][20] In October 2012, its monthly sales fell for the
first time in nine years.[21]
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. The first such
restaurant in Britain opened at Fallowfield, Manchester in 1986.[22]
A Montevideo McCafé
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.
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 McCafé 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,[23][unreliable source?] while others
called McExpress have limited seating and/or menu or may be located in a shopping mall. Other
McDonald's are located in Walmart stores. McStop is a location targeted at truckers and
travelers which may have services found at truck stops.[24]
Since 1997, in addition to many in Israel, one kosher McDonald's is located in the Abasto mall,
in Buenos Aires, Argentina.[25][26]
Global operations
See also: List of countries with McDonald's restaurants and International availability of McDonald's
products
Countries with McDonald's restaurants, showing their first year with its first restaurant
McDonald's has become emblematic of globalization, sometimes referred to as the
"McDonaldization" of society. The Economist newspaper 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. Norway has the most expensive Big Mac in the world as of
July 2011, while the country with the least expensive Big Mac is India[27] (albeit for a Maharaja
Mac—the next cheapest Big Mac is Hong Kong).[28]
A McDonald's Ebi Feast meal sold at Singapore branches in November 2013.
Thomas Friedman once said that no country with a McDonald's had gone to war with
another.[29][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. McDonald's suspended
operations in its corporate-owned stores in Crimea after Russia annexed the region in 2014.[30]
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[31] 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 has taken to partnering up with Sinopec, the second largest oil
company in the People's Republic of China, as it takes advantage of the country's growing use of
personal vehicles by opening numerous drive-thru restaurants.[32] McDonald's has opened a
McDonald's restaurant and McCafé on the underground premises of the French fine arts
museum, The Louvre.[33]
The company stated it will open vegetarian-only restaurants in India by mid-2013.[34]
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.[citation needed]
The McDonald's Corporation's business model is slightly different from that of most other fastfood 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.[citation
needed]
It has been proven the McDonald's corporate model involves managers of a specific franchises
systematically illegally withhold wages from employees when store sales exceed a set percentage
of sales intake leaving high percentages of their workforce earning less than the minimum
wage.[38][39]
The United Kingdom and Ireland business model is different from the U.S, 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.[citation needed]
In other countries, McDonald's restaurants are operated by joint ventures of McDonald's
Corporation and other, local entities or governments.[citation needed]
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.[citation needed]
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. 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 to some extent based
on the culture of the host country.[citation needed]
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 its 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[citation needed], as
well as a few other slogans for select countries and regions. At times, it has run into trouble with
its campaigns.
Space exploration
McDonald's and NASA explored an advertising agreement for a planned mission to the asteroid
449 Hamburga; however, the spacecraft was eventually cancelled.[40]
Children's advertising
Main articles: Ronald McDonald and McDonaldland
Sports awards and honors
See Category:McDonald's High School All-Americans
Charity
See also: Ronald McDonald House Charities
McHappy Day
McHappy Day is an annual event at McDonald's, where a percentage of the day's sales go to
charity. It is the signature fundraising event for Ronald McDonald House Charities.[41]
In 2007, it was celebrated in 17 countries: Argentina, Australia, Austria, Brazil, Canada, the
United States, Finland, France, Guatemala, Hungary, England, Ireland, New Zealand, Norway,
Sweden, Switzerland and Uruguay.
According to the Australian McHappy Day web site, McHappy Day raised $20.4 million in
2009. The goal for 2010 was $20.8 million.[42]
McDonald's Monopoly donation to St. Jude
In 1995, St. Jude Children's Research Hospital received an anonymous letter postmarked in
Dallas, Texas, containing a $1 million winning McDonald's Monopoly game piece. McDonald's
officials came to the hospital, accompanied by a representative from the accounting firm Arthur
Andersen, who examined the card under a jeweler's eyepiece, handled it with plastic gloves, and
verified it as a winner.[43] Although game rules prohibited the transfer of prizes, McDonald's
waived the rule and has made the annual $50,000 annuity payments, even after learning that the
piece was sent by an individual involved in an embezzlement scheme intended to defraud
McDonald's (see McDonald's Monopoly).
Environmental record
In April 2008, McDonald's announced that 11 of its Sheffield, England restaurants have been
using a biomass trial that had cut its waste and carbon footprint by half in the area. In this trial,
wastes from the restaurants were collected by Veolia Environmental Services, and were used to
produce energy at a power plant. McDonald's plans to expand this project, although the lack of
biomass power plants in the United States will prevent this plan from becoming a national
standard anytime soon.[57] In addition, in Europe, McDonald's has been recycling vegetable
grease by converting it to fuel for its diesel trucks.[58]
Furthermore, McDonald's has been using a corn-based bioplastic to produce containers for some
of its 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.[59]
In 1990 McDonald's worked with the Environmental Defense Fund to stop using "clam shell"
shaped styrofoam food containers to house its food products.[60] 20 years later McDonald's
announced they would try replacing styrofoam coffee cups with an alternative material.[61]
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 recycledcontent materials.[62] McDonald's reports that it is 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.[63]
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.[64]
When McDonald’s received criticism for its environmental policies in the 1970s, it began to
make substantial progress towards source reductions efforts.[65] 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.[66] 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.[67]
Overall, weight reductions in packaging and products, as well as the increased usage of bulk
packaging ultimately decreased packaging by 24 million pounds annually.[68]
Employment practices
See also: Fast food worker strikes
On 5 August 2013, The Guardian revealed that 90% of McDonalds UK workforce are on zero
hour contracts, making it possibly the largest such private sector employer in the country.[74]
A study released by Fast Food Forward conducted by Anzalone Liszt Grove Research showed
that approximately 84% of all fast food employees working in New York City in April 2013 had
been paid less than their legal wages by their employers.[75]
From 2007 to 2011, fast food workers in the US used an average of $7 billion of public
assistance annually resulting from receiving low wages.[76] The McResource phone line advises
McDonald's minimum wage employees to apply for food stamps.[77] The McResource website
advises employees to break their food into smaller pieces to feel fuller, seek refunds for
unopened holiday purchases, sell possessions online for quick cash, and to "quit complaining" as
"stress hormone levels rise by 15 percent after ten minutes of complaining."[78] In December,
2013, McDonald’s shut down the McResource website amidst negative publicity and criticism.
McDonald’s plans to continue an internal telephone help line through which its employees can
access its work-life help resources.[79]