RAYMOND A. KROC
Name: Raymond Albert Kroc
Born: 2 October 1902 Chicago, Illinois, United States
Died: 14 January 1984 San Diego, California, United States
Raymond Albert Kroc (1902-1984) was a salesman who set up the first franchise of
the McDonald brothers' drive-in restaurant. He bought the golden arches symbol
from them and built the McDonald's chain based on the concepts of a limited menu
of controlled quality and uniformity combined with massive advertising.
Ray Kroc was born in Chicago, Illinois, on October 2, 1902, the son of
relatively poor parents. He went to public schools in Oak Park, Illinois, a
suburb of Chicago, but did not graduate, leaving school to serve as an ambulance
driver during World War I, like Ernest Hemingway, also from Oak Park. After the
war Kroc became a jazz pianist, playing with the Isham Jones and Harry Sosnick
orchestras. Upon his marriage in 1922 he went to work for the Lily-Tulip Cup
Company, but soon left to become musical director for one of Chicago's pioneer
radio stations, WGES. There he played the piano, arranged the music, accompanied
singers, and hired musicians. Kroc's wanderlust was not satisfied with this, and
the real estate boom in Florida soon found him in Fort Lauderdale selling real
estate. When the boom collapsed in 1926 Kroc was so broke that he had to play
piano in a night club to send his wife and daughter back to Chicago by train. He
later followed them in his dilapidated Model-T Ford.
Kroc thereupon returned to Lily-Tulip as a salesman, later becoming midwestern
sales manager. In 1937 he came upon a new invention, a machine that could mix
five milk shakes at one time, called the "multi-mixer." Kroc founded his own
company to serve as exclusive distributor for the product in 1941. Many years
later, in 1954, Kroc heard of a drive-in restaurant in San Bernardino,
California, owned by Richard and Maurice D. McDonald, which was operating eight
of his multi-mixers. Curious as to how they could possibly use so many machines
in a small establishment, Kroc found the brothers were doing a remarkable
business selling only hamburgers, french fries, and milk shakes. Kroc, from his
years in the paper cup and milk shake business, recognized a potential gold mine
and approached the brothers about starting a franchise operation based on their
restaurant, selling hamburgers for 15 cents, fries for 10 cents, and shakes for
20 cents. After some negotiation the McDonald brothers agreed. Under the
arrangement, they would receive one-half of one percent of the gross, Kroc would
use the McDonald name and concept, pledged to retain high levels of quality, and
would retain their symbol--the golden arches. Ray Kroc opened the first of the
chain of McDonald's restaurants on April 15, 1955, in Des Plaines, Illinois.
Small by today's standards, this restaurant in Des Plaines (now the world's
first "Hamburger Museum") was a little red and white tile affair where root beer
was poured from a wooden barrel, potatoes were peeled in the restaurant, and
there were local supplies of fresh hamburger meat. The symbol, now long
forgotten, was Speedee, a hamburger-bun-faced creature. On that first day, Kroc's
restaurant had sales of $366.12. By 1961 there were over 130 outlets, and in
that year Kroc bought out the McDonald brothers for $2.7 million. From these
humble beginnings emerged an empire which by 1984 had 8,300 restaurants in 34
countries with sales of more than $10 billion.
Ray Kroc revolutionized the restaurant industry in much the same way that Henry
Ford transformed the automobile industry a generation earlier. Kroc's great
contribution was to figure out how to mass-produce food uniformly in astounding
quantities, and then to convince millions of Americans that they needed to buy
this food. To accomplish the first objective, Kroc reduced the food business to
a science. Nothing was left to chance in the logistics of the McDonald's
operations, which were carefully researched by sophisticated methods. The
precision of the operation can be appreciated when it is understood that each
McDonald hamburger was made with a 1.6 ounce beef patty, not more than 18.9
percent fat. It is exactly .221 inches thick and 3.875 inches wide. All other
aspects of the operation are equally rigidly controlled. Kroc also relentlessly
stressed quality, banning from his hamburgers such filler materials as soybeans.
The other side of the McDonald's success story is franchising, marketing, and
advertising. Three-quarters of McDonald's restaurants are run by franchise-holders.
By 1985 each franchise cost about $250,000 and ran for 20 years, after which it
reverted to the company. When choosing franchise-holders, Kroc always looked for
someone good with people. As he said," ... we'd rather get a salesman than an
accountant or even a chef." The franchise owners were then intensely trained at
McDonald's "Hamburger University" in Elk Grove, Illinois, where a training
course led to a "Bachelor in Hamburgerology with a minor in french fries." The
company also provided a lengthy manual that outlined every aspect of the
operation, from how to make a milk shake to how to be responsive to the
community. The capstone of the McDonald's operation, however, was advertising.
Hundreds of millions of dollars were poured into advertising--to the point where
the head of another fast-food company said in 1978 that consumers were "so
preconditioned by McDonald's advertising blanket that the hamburger would taste
good even if they left the meat out."
Despite its astounding success, and despite the fact that the company worked
hard to project a charitable and community-oriented image, McDonald's came under
attack on several fronts. A number of communities refused to allow its
restaurants in their area, seeing it (as one commented) as a "symbol of the
asphalt and chrome culture." The company was also criticized for its extensive
use of part-time teenaged help, and especially for the $200,000 which Kroc
donated to Richard Nixon's re-election campaign, since the administration soon
after recommended amending the minimum wage law to provide for a "youth
differential." This would have allowed employers to hire teenagers at 80 percent
of the minimum wage. The architecture of the buildings and the nutritional
content of the food was assailed, although nutritionist Jean Mayer said that as
"a weekend treat, it is clean and fast."
In the mid-1970s Kroc turned his energy from hamburgers to baseball, buying the
San Diego Padres. He had less success at this, however, and in 1979 gave up
operating control of the team, saying with his typical crustiness, "there's a
lot more future in hamburgers than in baseball. Baseball isn't baseball anymore."
In the years before his death he and his second wife, Joan, set up foundations
to aid alcoholics and established Ronald McDonald houses to help the families of
children stricken with cancer.
Kroc cut a commanding figure, his thin hair brushed straight back, his custom
blazers impeccable, the bulky rings on his fingers glinting as he ate his
hamburgers with both hands. Aware of his abrasiveness, he once commented: "I
guess to be an entrepreneur you have to have a large ego, enormous pride and an
ability to inspire others to follow your lead." He died in San Diego on January
14, 1984.
Name: Raymond Albert Kroc
Born: 2 October 1902 Chicago, Illinois, United States
Died: 14 January 1984 San Diego, California, United States
Raymond Albert Kroc (1902-1984) was a salesman who set up the first franchise of
the McDonald brothers' drive-in restaurant. He bought the golden arches symbol
from them and built the McDonald's chain based on the concepts of a limited menu
of controlled quality and uniformity combined with massive advertising.
Ray Kroc was born in Chicago, Illinois, on October 2, 1902, the son of
relatively poor parents. He went to public schools in Oak Park, Illinois, a
suburb of Chicago, but did not graduate, leaving school to serve as an ambulance
driver during World War I, like Ernest Hemingway, also from Oak Park. After the
war Kroc became a jazz pianist, playing with the Isham Jones and Harry Sosnick
orchestras. Upon his marriage in 1922 he went to work for the Lily-Tulip Cup
Company, but soon left to become musical director for one of Chicago's pioneer
radio stations, WGES. There he played the piano, arranged the music, accompanied
singers, and hired musicians. Kroc's wanderlust was not satisfied with this, and
the real estate boom in Florida soon found him in Fort Lauderdale selling real
estate. When the boom collapsed in 1926 Kroc was so broke that he had to play
piano in a night club to send his wife and daughter back to Chicago by train. He
later followed them in his dilapidated Model-T Ford.
Kroc thereupon returned to Lily-Tulip as a salesman, later becoming midwestern
sales manager. In 1937 he came upon a new invention, a machine that could mix
five milk shakes at one time, called the "multi-mixer." Kroc founded his own
company to serve as exclusive distributor for the product in 1941. Many years
later, in 1954, Kroc heard of a drive-in restaurant in San Bernardino,
California, owned by Richard and Maurice D. McDonald, which was operating eight
of his multi-mixers. Curious as to how they could possibly use so many machines
in a small establishment, Kroc found the brothers were doing a remarkable
business selling only hamburgers, french fries, and milk shakes. Kroc, from his
years in the paper cup and milk shake business, recognized a potential gold mine
and approached the brothers about starting a franchise operation based on their
restaurant, selling hamburgers for 15 cents, fries for 10 cents, and shakes for
20 cents. After some negotiation the McDonald brothers agreed. Under the
arrangement, they would receive one-half of one percent of the gross, Kroc would
use the McDonald name and concept, pledged to retain high levels of quality, and
would retain their symbol--the golden arches. Ray Kroc opened the first of the
chain of McDonald's restaurants on April 15, 1955, in Des Plaines, Illinois.
Small by today's standards, this restaurant in Des Plaines (now the world's
first "Hamburger Museum") was a little red and white tile affair where root beer
was poured from a wooden barrel, potatoes were peeled in the restaurant, and
there were local supplies of fresh hamburger meat. The symbol, now long
forgotten, was Speedee, a hamburger-bun-faced creature. On that first day, Kroc's
restaurant had sales of $366.12. By 1961 there were over 130 outlets, and in
that year Kroc bought out the McDonald brothers for $2.7 million. From these
humble beginnings emerged an empire which by 1984 had 8,300 restaurants in 34
countries with sales of more than $10 billion.
Ray Kroc revolutionized the restaurant industry in much the same way that Henry
Ford transformed the automobile industry a generation earlier. Kroc's great
contribution was to figure out how to mass-produce food uniformly in astounding
quantities, and then to convince millions of Americans that they needed to buy
this food. To accomplish the first objective, Kroc reduced the food business to
a science. Nothing was left to chance in the logistics of the McDonald's
operations, which were carefully researched by sophisticated methods. The
precision of the operation can be appreciated when it is understood that each
McDonald hamburger was made with a 1.6 ounce beef patty, not more than 18.9
percent fat. It is exactly .221 inches thick and 3.875 inches wide. All other
aspects of the operation are equally rigidly controlled. Kroc also relentlessly
stressed quality, banning from his hamburgers such filler materials as soybeans.
The other side of the McDonald's success story is franchising, marketing, and
advertising. Three-quarters of McDonald's restaurants are run by franchise-holders.
By 1985 each franchise cost about $250,000 and ran for 20 years, after which it
reverted to the company. When choosing franchise-holders, Kroc always looked for
someone good with people. As he said," ... we'd rather get a salesman than an
accountant or even a chef." The franchise owners were then intensely trained at
McDonald's "Hamburger University" in Elk Grove, Illinois, where a training
course led to a "Bachelor in Hamburgerology with a minor in french fries." The
company also provided a lengthy manual that outlined every aspect of the
operation, from how to make a milk shake to how to be responsive to the
community. The capstone of the McDonald's operation, however, was advertising.
Hundreds of millions of dollars were poured into advertising--to the point where
the head of another fast-food company said in 1978 that consumers were "so
preconditioned by McDonald's advertising blanket that the hamburger would taste
good even if they left the meat out."
Despite its astounding success, and despite the fact that the company worked
hard to project a charitable and community-oriented image, McDonald's came under
attack on several fronts. A number of communities refused to allow its
restaurants in their area, seeing it (as one commented) as a "symbol of the
asphalt and chrome culture." The company was also criticized for its extensive
use of part-time teenaged help, and especially for the $200,000 which Kroc
donated to Richard Nixon's re-election campaign, since the administration soon
after recommended amending the minimum wage law to provide for a "youth
differential." This would have allowed employers to hire teenagers at 80 percent
of the minimum wage. The architecture of the buildings and the nutritional
content of the food was assailed, although nutritionist Jean Mayer said that as
"a weekend treat, it is clean and fast."
In the mid-1970s Kroc turned his energy from hamburgers to baseball, buying the
San Diego Padres. He had less success at this, however, and in 1979 gave up
operating control of the team, saying with his typical crustiness, "there's a
lot more future in hamburgers than in baseball. Baseball isn't baseball anymore."
In the years before his death he and his second wife, Joan, set up foundations
to aid alcoholics and established Ronald McDonald houses to help the families of
children stricken with cancer.
Kroc cut a commanding figure, his thin hair brushed straight back, his custom
blazers impeccable, the bulky rings on his fingers glinting as he ate his
hamburgers with both hands. Aware of his abrasiveness, he once commented: "I
guess to be an entrepreneur you have to have a large ego, enormous pride and an
ability to inspire others to follow your lead." He died in San Diego on January
14, 1984.