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McDonald'sFrom Wikipedia, the free encyclopedia

McDonald's

Type Public

Traded as NYSE: MCD

Dow Jones Industrial Average Component

Industry Restaurants

Founded May 15, 1940 in San Bernardino, California;

McDonald's Corporation, April 15, 1955 inDes Plaines,

Illinois

Founder(s) Richard and Maurice McDonald McDonald's restaurant

concept;

Ray Kroc, McDonald's Corporation founder.

Headquarters Oak Brook, Illinois, U.S.

Number of

locations

32,000+ worldwide[1]

Area served Worldwide

Keypeople James A. Skinner

(Chairman & CEO)


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Products Fast food

(hamburgers chicken french fries soft

drinks coffee milkshakes salads desserts breakfast)

Revenue US$ 24.075 billion(2010)[2]

Operating

income

US$ 7.473 billion(2010)[2]

Net income US$ 4.949 billion(2010)[2]

Total assets US$ 31.975 billion (2010)[2]

Total equity US$ 14.634 billion(2010)[2]

Employees 400,000 (January 2010)[2]

Website McDonalds.com

This box: viewtalkedit

McDonald's Corporation (NYSE: MCD) is the world's largest chain of hamburgerfast food restaurants,

serving more than 58 million customers daily.[3]In addition to its signature restaurant chain, McDonalds

Corporation held a minority interest in Pret A Mangeruntil 2008, was a major investor in theChipotle

Mexican Grill until 2006,[4] and owned the restaurant chain Boston Market until 2007.[5]

A McDonald's restaurant is operated by either afranchisee, 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.[6]

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 criticismover the healthiness of its products, the company has modified its menu to include alternatives considered

healthier such as salads, wraps and fruit.[7]

Contents

[hide]

1 History


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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 Further reading

12 External links

History

McDonald's Logo used from 1968 to 2003. It still exists at some restaurants.


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"Speedee", the former mascot of McDonald's before his replacement by Ronald McDonald.

Concept version of Ronald McDonald.Main article: History of McDonald's

The business began in 1940, with a restaurantopened by brothers Richard and Maurice McDonald in San

Bernardino, California. Their introduction of the "Speedee Service System" in 1948 established the

principles of the modernfast-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 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 famous double arched "M" symbol in use today did not appear until November 18,

1968, when the company filed a U.S. trademark.

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 afranchised 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]


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With the expansion of McDonald's into many international markets, the company has become a symbol

ofglobalizationand the spread of theAmerican way of life. Its prominence has also made it a frequent topic

of public debates about obesity,corporate ethics and consumerresponsibility.

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 58 million

customers each day.[3] McDonald's operates over 31,000 restaurants worldwide, employing more than 1.5

million people.[11] The company also operates other restaurantbrands, such as Piles Caf.

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 inChipotle 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. The first such restaurant in Britain opened at Fallowfield, Manchesterin 1986.[15]

In some countries, "McDrive" locations nearhighways 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.


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Specially themed restaurants also exist, such as the "Solid Gold McDonald's," a 1950srock-and-roll

themed restaurant.[16]In Victoria, British Columbia, there is also a McDonald's with a 24-carat (100%)

gold chandelierand similar light fixtures.

To accommodate the current trend for high quality coffee and the popu larity of coffee shops in general,

McDonald's introducedMcCaf, a caf-style accompaniment to McDonald's restaurants in the style

ofStarbucks. McCaf is a concept created by McDonald's Australia, starting with Melbourne in 1993.

Today, most McDonald's in Australia have McCafs located within the existing McDonald's restaurant.

In Tasmania, there are McCafs in every store, with the rest of the states quickly following suit. After

upgrading to the new McCaf 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 McCafs worldwide.

Some locations are connected to gas stations/convenience stores,[17] 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.[18]

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 outdoorplaygrounds. 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 renovatedinto "R

Gym" areas.

Redesign


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McDonald's in Darlington, UK. This is an example of the new look of McDonald's in Europe.

In 2006, McDonald's introduced its "Forever Young" brand by redesigning all of their restaurants, the f irst

major redesign since the 1970s.[19][20]

The McDonald's restaurant inBanbury's Bridge Street in 2010. It is still in white paint outside and blue/grey/brown inside

as it was since 2002.

The design includes the traditional McDonald's yellow and redcolors, 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.

One of four McDonald's restaurants located onOxford Street, London, Europe's busiest shopping street.

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 jo int ventures. The McDonald's Corporation'sbusiness 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 collectrent, which may also be calculated on the


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basis

fsal s. Asa

iti

f any f anchiseagreements,

hich

arybycontract, age, country, and

location, the orporationmayownorlease thepropertiesonwhich cDonald's franchisesare located. In

most, ifnot all cases, the franchiseedoesnot own the locationof itsrestaurants.

he K businessmodel isdifferent, in that fewerthan % ofrestaurantsare franchised, with themajority

undertheownershipof thecompany. cDonald's trains its franchiseesandothersat amburger

ni

ersity in ak Brook, Illinois.

Inothercountries, cDonald'srestaurantsareoperatedby joint

enturesof cDonald's orporationand

other, local entitiesorgovernments.

Asamatterofpolicy, cDonald'sdoesnot makedirect salesof foodormaterials to franchisees, instead

organi ing thesupplyof foodandmaterials torestaurants throughapproved thirdparty logisticsoperators.

According toFastFoodNationbyEric Schlosser ! , nearlyone ineight workers in the .S. haveat

some timebeenemployedby cDonald's. According toanewspieceon " ox # ews this figure isone in

ten.!

hebookalsostates that

cDonald's is the largest privateoperatorofplaygrounds in the

.S., aswell

as thesingle largest purchaserofbeef, pork, potatoes, andapples. heselectionofmeats cDonald's

usesvarieswith thecultureof thehost country.

Sh h l ivi

McDonald'shas increasedshareholderdividends for $ % consecutiveyears,[ & ' ]making it oneof the S&P % ( (

Dividend Aristocrats.[ & & ][& ) ]

ontroversies

Asaprominent exampleof therapidglobali 0 ationof the Americanfast foodindustry,McDonald's isoften the

target ofcriticism foritsmenu, itsexpansion, and itsbusinesspractices.

1 heMcLibel 1 rial, alsoknownasMcDonald's R2

staurants vMorris & St2 2

l, isanexampleof thiscriticism.

In 3 4 4 5 , activists fromasmall groupknownasLondon 6 reenpeace 7 noconnection to the international

groupGreenpeace)distributed leafletsentitledWhat's wrongwith McDonald's?, critici 8 ing itsenvironmental,

health, and laborrecord. 9 hecorporationwrote to thegroupdemanding theydesist andapologi 8 e, and,

when twoof theactivistsrefused tobackdown, sued them forlibel inoneof the longest cases in Britishcivil

law. A documentaryfilmof theMcLibel 9 rialhasbeenshown inseveral countries.

Despite theobjectionsofMcDonald's, the term @ McJob"wasadded toMerriam-Webster's Collegiate

Dictionary in A 5 5 B .[C

D

] 9 he termwasdefinedas"a low-paying job that requires littleskill andprovides little

opportunity foradvancement".[ C E ] Inanopen lettertoMerriam-Webster, Jim F antalupo, former F EG of

McDonald's, denounced thedefinitionasa"slap in the face" toall restaurant employees, andstated that "a

moreappropriatedefinitionofa'McJob'might be'teachesresponsibility.'"Merriam-Websterresponded that

"westandby theaccuracyandappropriatenessofourdefinition."[C H ]

In 3 4 4 4 , I renchanti-globalisationactivist Jos Bovvandali 8 edahalf-builtMcDonald's toprotest against

the introductionof fast food in theregion.[ C P ]


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farmersareguiltyof furthercrimesincludingslaveryand the invasionof indigenouspeopleslands. R he

allegation is thatMcDonald's, asaclient ofS argill's, iscomplicit in theseactivities.[ T U ]

Argum i

Inresponse topublicpressure, McDonald'shassought to includemorehealthychoices in itsmenuandhas

introducedanewslogan to itsrecruitment posters: "Not bad foraMcJob".[ T V ] W R hewordMcJob, first attested

in themid-1980s[T X ]and laterpopulari Y edby S anadiannovelistDouglas S oupland inhisbookGeneration X,

hasbecomeabuzzword forlow-paid, unskilledworkwith fewprospectsorbenefitsand littlesecurity.)

McDonald'sdisputes the idea. In 007, thecompany launchedanadvertisingcampaignwith theslogan

"Wouldyou likeacareerwith that?"onIrish television, outlining that theirjobshavemanyprospects.

Inabid to tap intogrowingconsumer interest in theprovenanceof food, the fast-foodchain

recently[when? ]switched itssupplierofbothcoffeebeansandmilk. a K chiefexecutive SteveEasterbrooksaid:

"Britishconsumersare increasingly interested in thequality, sourcingandethicsof the foodanddrink they

buy". McDonald'scoffee isnowbrewed frombeans taken fromstocks that havebeencertifiedby

the b ainforest Alliance, aconservationgroup. Similarly, milksuppliesused foritshot drinksandmilkshakes

havebeenswitched toorganicsourceswhichcouldaccount for c % of the a K'sorganicmilkoutput.[ d 8]

McDonald'sannouncedonMay ` , 008 that, in the a .S. and e anada, itwouldswitch tousingcookingoil

foritsfrench friesthat containsnotrans fats, andcanola-basedoil withcornandsoyoilsbyyear'send forits

baked items, piesandcookies.[ d 9][f

0]

Withregard toacquiringchickens fromsupplierswhouse e AK or e AS methodsofslaughter,McDonald's

says theyneed toseemoreresearch"tohelpdeterminewhetherany e AS system incurrent use isoptimal

fromananimal welfareperspective."[f

1]

E vironm ntal record

In April g 008,McDonald'sannounced that 11of itsSheffield, Englandrestaurantshavebeenusinga

biomass trial that hadcut itswasteandcarbon footprint byhalf in thearea. In this trial, waste from the

restaurantswerecollectedbyVeolia Environmental Servicesandused toproduceenergyat apowerplant.

McDonald'splans toexpand thisproject, although the lackofbiomasspowerplants in the h .S. will prevent

thisplan frombecominganational standardanytimesoon.[i

p ] Inaddition, in Europe, McDonald'shasbeen

recyclingvegetablegreasebyconverting it to fuel fortheirdiesel trucks.[i

q ]

r urthermore,McDonald'shasbeenusingacorn-basedbioplastic toproducecontainers forsomeof their

products. Although industrieswhouse thisproduct claimacarbonsavingsofs 0% to80%,

aGuardianstudyshowsotherwise. t heresultsshow that this typeofplasticdoesnot breakdown in

landfillsasefficientlyasotherconventional plastics. t heextraenergy it takes torecycle thisplasticresults

inahigheroutput ofgreenhousegases. Also, theplasticscancontaminatewastestreams, causingother

recycledplastics tobecomeunsaleable.[i i

]

t he h .S. Environmental Protection AgencyhasrecognizedMcDonald'scontinuouseffort toreducesolid

wastebydesigningmoreefficient packagingandbypromoting theuseofrecycled-content


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materials.[u

v ]McDonald'sreports that theyarecommitted towardsenvironmental leadershipbyeffectively

managingelectricenergy, byconservingnatural resources throughrecyclingandreusingmaterials, andby

addressingwatermanagement issueswithin therestaurant.[u

w ]

Inaneffort toreduceenergyusageby x y % in itsrestaurants,McDonald'sopenedaprototyperestaurant in

hicago in x 009with the intentionofusing themodel in itsotherrestaurants throughout theworld. Building

onpast efforts, specificallyarestaurant it opened in Sweden inx 000 that was the first to intentionally

incorporategreen ideas,McDonald'sdesigned the hicagosite tosaveenergyby incorporatingoldand

new ideassuchasmanagingstormwater, usingskylights formorenatural lightingand installingsome

partitionsand tabletopsmade fromrecycledgoods.[u

7]

WhenMcDonaldsreceivedcriticism foritsenvironmental policies in the1970s, it began tomakesubstantial

progress towardssourcereductionsefforts.[u

8] orinstance, an averagemeal in the1970sa BigMac,

fries, andadrinkrequired

gramsofpackaging; today, it requiresonly x y grams, allowinga

%

reduction.[u

9] Inaddition, McDonaldseliminated theneed forintermediatecontainers forcolabyhavinga

deliverysystem that pumpssyrupdirectly from thedelivery truck intostoragecontainers, saving twomillion

poundsofpackagingannually.[ v 0] verall, weight reductions inpackagingandproducts, aswell as the

increasedusageofbulkpackagingultimatelydecreasedpackagingbyx

millionpoundsannually.[ v 1]

Legal cases

Mainarticle: McDonald's legalcases

McDonald'shasbeen involved inanumberoflawsuitsandotherlegal cases, most ofwhich

involvedtrademarkdisputes. hecompanyhas threatenedmany foodbusinesseswith legal actionunless

theydrop theMcorMac from theirtradingname. Inonenoteworthycase,McDonald'ssueda Scottishcaf

ownercalledMcDonald, even though thebusiness inquestiondatedbackoveracentury Sheriff ourt

Glasgowand Strathkelvin, November x 1, 1952). n September8, 2009,McDonald'sMalaysianoperations

lost a lawsuit toprevent anotherrestaurant calling itselfMcCurry.McDonald's lost inanappeal toMalaysia's

highest court, the ederal Court.[52]

It hasalso filednumerousdefamationsuits. orexample, in theMcLibel case, McDonald'ssued two

activists fordistributingpamphletsattacking itsenvironmental, laborandhealthrecords. Afterthe longest

trial in K legal history, the judge found that someclaims in thepamphlet wereuntrueand therefore

libellous. hecompany, however, hadasserted that all claims in thepamphlet wereuntrue, essentially

obliging the judge topubliclyruleoneachone. Embarrassingly forthecompany, several of thespecificallegationswereupheld.[53]

McDonald'shasdefended itself inseveral cases involvingworkers'rights. In2001 thecompanywas fined

12,

00by Britishmagistrates for illegallyemployingandover-workingchild laborinoneof itsLondon

restaurants. his is thought tobeoneof the largest fines imposedonacompany forbreaking lawsrelating

tochildworkingconditions v2002 EWCA Crim1094). In April 2007 inPerth, WesternAustralia,

McDonald'spleadedguilty to fivechargesrelating to theemployment ofchildrenunder15 inoneof its

outletsandwas fined A 8,000.[54]


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Possibly the most infamous legal case involving McDonald's was the 1994 decision inThe McDonald's

Coffee Case where Stella Liebeck suffered third-degree burns after spilling a fresh cup of McDonald's

coffee on herself.

In a McDonald'sAmerican Idol figurine promotion, the figurine that represents "New Wave Nigel" wears

something that closely resembles Devos Energy Dome, which was featured on the band's album

cover, Freedom of

oice. 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.[55]

Products

A McDonald'sBig Mac combo meal served with French fries and Coca-Cola.

Main article: McDonald's products

See also: McDonald's products (international)

McDonald's predominantly sellshamburgers, various types ofchickensandwichesand products, French

fries, soft drinks, breakfast items, and desserts. In most markets, McDonald'soffers salads and vegetarian items, wraps and other localized fare. Portugal is the only country with

McDonald's restaurants 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 inIndia) 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, located in Oak Brook, Illinois is the headquarters of McDonald's


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The McDonald's headquarters complex, McDonald's Plaza, is located inOak Brook, Illinois. It sits on the

site of the former headquarters and stabling area of Paul Butler, the founder of Oak Brook.[56] McDonald's

moved into the Oak Brook facility from an office within the Chicago Loop in 1971.[57]

Advertising

Main article: McDonald's ad ertising

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 billboardsand signage, sponsors

sporting events ranging from Little League to the Olympic Games, and makes coolers oforange 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[citation needed], as well as a few

other slogans for select countries and regions. At times, it has run into trouble with its campaigns.

C ildren's ad ertising

Main articles: onald McDonaldandMcDonaldland

Sports awards and onors

See ategory:McDonald's Hig Sc ool All-Americans

Global operations

See also: List of countries it McDonald's franc ises

Countries with McDonald's stores

McDonald's has become emblematic ofglobalization, sometimes referred to as the "McDonaldization"

of society. T e Economistnewspaper 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 theBig 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, whilse the country with the least

expensive Big Mac is Malaysia.[citation needed]

Thomas Friedman once said that no country with a McDonald's had gone to war with another.[58][Full

citation needed] However, the "Golden Arches Theory of Conflict Prevention" is not strictly true. Exceptions


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