McDonald’s is one of the world’s largest multinational fast-food restaurants. The McDonald brothers opened the first major outlet in 1948 with cheeseburgers, fries, hamburgers and soda, making up its initial menu (McDonald’s, 2020). Richard and Maurice MacDonald in 1940 had moved the business to San Bernardino, California, several miles away from it first location under a new brand “McDonald’s Bar-B-Que”. And with menu comprising 25 dishes, the restaurant was knowns for being a food service that gave customers the leverage to remain in the comfort of their cars in the parking lots while the waiters delivered their orders to them. This strategy was a breakaway from the existing sit-in or walk-in service model used by other restaurants, giving McDonald’s an edge over other competition in terms of customer convenience.
The McDonald brothers in 1948, observed that a significant portion of the profits generated were from the sale of hamburgers. Armed with this knowledge, the restaurant’s menu was reviewed to include only selected dishes such as hamburgers, potato chips, cheeseburgers, apple cakes, soft drinks and coffee (McDonald’s, 2020). Milkshakes and fries replaced potato chips and apple cake in the menu. These were part of the early changes implemented in the first years. Additionally, the restaurant further optimized sales channel by adding self-service to the existing car park delivery and also redesigned their restaurant kitchen to be the most productive. The restaurant was later renamed McDonald’s (McDonald’s, 2020).
Ray Kroc’s became a business acquaintance with the McDonald’s brothers and he has been credited for paving the way for the business swift expansion. Kroc had suggested a change to the business model, recommending the adoption of franchising rather than the existing centralized approach. This suggestion was initially received with skepticism until Kroc prevailed on them to take up the opportunity of having him manage the outstate operation of McDonald’s with him remitting half the percentage of revenue earned annually from sales.
In 1955, the restaurant opened its first branch near Chicago. Over three years, the business grew gradually reaching 34 outlets in 1958. The following year, Kroc launched additional 68 new restaurants, bringing the total number of McDonald’s franchises across the United States to 102. (McDonald’s, 2020).
Almost a decade later, the restaurant launched its first international outlet in British Columbia, Canada. The management continued on this trend of foreign expansion, opening up over 3600 new restaurants in 56 countries across Europe and Asia and these oversea branches were already generating 37% of the business sales by 1991 (McDonald’s, 2020).
In 2020, McDonald’s with 38,695 outlets worldwide achieved annual sales of $20.8B, making McDonald’s one of the largest fast-food chain restaurants in the world (Forbes, 2020).