The Big Mac

Submitted by:

Naomi C. Palanca

3ALM

Submitted to:

Dr. Nerissa M. Revilla

August 7,2018
My favorite retail business is McDonalds. It has an interesting backstory and it’s
certainly more than meets the eye. The man who built one of the largest restaurant
franchises in the world is not named McDonald.

Ray Kroc, who transformed a small burger joint into a global fast food giant, is
already a household name for many Big Mac fans, but The Founder—a movie,
and McDonald's: Behind The Arches, the book that it’s based to by John F. Love,

—tells the story behind the origins of McDonald’s and how Kroc rewrote history to
call himself the founder of the company. Or, rather, it tells one version of the
story.

The details of what really happened depend on whom you ask —a fact that was
made clear in a 1973 TIME cover story about McDonald’s. This is how that article
told the story:

In 1940, the original McDonald brothers Richard and Maurice—who were known
as Dick and Mac, respectively opened a drive-in hamburger restaurant near
Pasadena, Calif. However, by 1948, they realized their eatery would be more
profitable if they increased efficiency by streamlining the menu and preparing
food ahead of rush times. One innovative change: using infrared heat lamps to
keep French fries warm, a technique Dick told TIME that they were the first in the
industry to adopt. Contrary to the narrative of The Founder, which shows Kroc
giving the brothers the idea to franchise, Dick and Mac had franchised about six
restaurants before they met Kroc. Kroc, who supplied the milkshake machines
used in their restaurants, was so surprised when they placed an order for eight
Multimixers for one restaurant that he flew to California to find out what kind of
business could possibly be making so many milkshakes.

Kroc—who had previously struggled to make ends meet, taking gigs as a jazz
pianist and a paper-cup salesman over the years—immediately asked for the job
as McDonald’s franchise agent. “When I got there, I saw more people waiting in
line than I had ever seen at any drive-in,” he told TIME. “I said to myself: ‘Son of a
*****, these guys have got something. How about if I open some of these
places?'” He struck a deal with Dick and Mac, agreeing to pay them 0.5% of all
future sales. Over the next five years, he created a chain of 228 McDonald’s, in
locations specifically selected in suburbs filled with families to whom the company
hoped to market. Trying to appeal to kids, the company developed the character
of Ronald McDonald to appear on TV ads and in restaurants. By 1960, the
restaurants were grossing $56 million annually.

Kroc, however, was dissatisfied with his small cut of the profits. He as ked the
McDonald brothers how much they’d be willing to pay to sell him the whole chain,
including its name. Their price was $2.7 million, with the caveat that they would
maintain ownership of their original restaurant. Kroc borrowed from multiple
sources in order to meet the price. “The $2.7 million ended up costing me $14
million,” Kroc told TIME. “But I guess there was no way out. I needed the
McDonald name and those golden arches. What are you going to do with a name
like Kroc?”

The sale left Kroc bitterly angry with the McDonald brothers for keeping the
original location. He opened a McDonald’s location across the street from the
brothers’ original restaurant, forcing them to rename the original burger joint,
which didn’t stay in business much longer.

“I ran ’em out of business,” he gleefully told TIME.

That was an angle with which Dick McDonald didn’t exactly agree: “Ray Kroc
stated that he forced McDonald Bros, to remove the name McDonald’s from the
unit we retained in San Bernardino, Calif. The facts are that we took the name off
the building and removed the arches immediately upon the closing of the sale of
our company to Kroc and associates in December 1961,” he stated in a letter to
the editor that ran several weeks later. “Kroc must have been kidding when he
told your reporter that we renamed our unit Mac’s Place. The name we used was
The Big M. Ray was also being facetious when he told your reporter that he drove
us out of business. My brother and I had retired two years previous to the sale,
and were living in Santa Barbara, Calif. We had turned the operation of the San
Bernardino unit over to a couple of longtime employees of ours who operated the
drive-in for seven years. Ray Kroc was always a great prankster and probably
couldn’t resist the temptation to needle me.”

Nevertheless, Kroc proclaimed himself McDonald’s founder. Indeed, the company

honored him on its Founder’s Day (and wouldn’t include the McDonald brothers
until 1991).

Kroc’s version of the story upset the McDonald brothers after the publication of
his 1992 autobiography Grinding it Out: The Making of McDonald’s. In the book,
he named the first franchise he opened—in Des Plaines, Ill.—as the first
McDonald’s restaurant ever opened.
“Up until the time we sold, there was no mention of Kroc being the founder,” Dick
McDonald told the Wall Street Journal in 1991. ”If we had heard about it, he would
be back selling milkshake machines.”

The story is just so intriguing to me that it always gives me mixed feelings every
time I eat at McDonalds, unexplainable yet so conducive to keep exploring the
thought of it’s origin, if it fits on the black or white spectrum of our standards as
humans, or if it’s more complicated and is situated on the gray area.

References: The Founder(2016), McDonald's: Behind The Arches by John F. Love

http://time.com/money/4602541/the-founder-mcdonalds-movie-accuracy/