Ray Kroc was the mastermind behind the worldwide McDonald's fast food franchise. He was an American businessman who took over the small-scale McDonald's Corporation franchise in 1954 and built it into the largest, most influential fast food chain in the world.
Ray Kroc was born in 1902 to Czech-Americans in
During the late 1950s, Kroc tried his hand at selling paper cups. He even worked as a pianist for a short period of time before settling into a position as a milkshake machine salesman. He travelled around the country and sold milkshake machines to various different cafes and restaurants. He had been observing the layout and management of the industry and was convinced that many restaurants suffered from poor management. They were not living up to their potential. It was during this time that he ran across a small hamburger restaurant in
The restaurant, owned by the McDonald brothers, Richard and Maurice, ran eight of the same milkshake machines sold by the fifty-two year old Kroc. Since each machine could spin five milkshakes at once, Kroc was intrigued by the idea of a restaurant that needed the ability to make forty milkshakes at a time. He traveled to
Kroc approached the brothers with a business plan and eventually settled on a deal. As a result of the partnership, Kroc would receive only 1.4% of the franchisees' profit, giving 0.5% to the brothers. After some time, Kroc realized that his profit would be too minimal. So, in order to gain access to more of his investment, Ray Kroc convinced the brothers to sell him the rights to the McDonald's name.
Kroc envisioned a restaurant that ran like a factory and produced hot food, fast service, with consistent quality regardless of where the restaurant was situated in. He saw food preparation as a process and broke it down into steps that could be duplicated in any of his restaurants. This way, he could keep the product the same no matter where the McDonald's was located.
Low franchise fees made it easy to open new stores but cut into any potential profits for Kroc. As a result, Kroc decided to purchase the land on which McDonald's would open and ultimately serve as a landlord. He set up the Franchise Realty Corporation in 1956 and was able to purchase tracts of land in order to help him produce a profit for his company. By 1960 there were over 200 McDonald's around the
Kroc saw his franchise as a way to sell as service, not food. After all, Big Boy, Dairy Queen, and A&W were already established restaurant chains. Ray Kroc needed McDonald's to stand out. Consistency was the key and he made sure that every McDonald's ran the same. He established national advertising campaigns to support his restaurants and took the brand international in 1971 to
Kroc established various foundations for alcoholics, and also started the Ronald McDonald House foundation to help the families of children stricken with cancer.
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