The Story Of McDonald's: How McDonald’s First Got Its Start

McDonald's is an American multinational fast food corporation, founded in 1940 as a restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, United States. 

In October 1948, after the McDonald brothers realized that most of their profits came from selling hamburgers, they closed down their successful carhop drive-in to establish a streamlined system with a simple menu which consisted of only hamburgers, cheeseburgers, potato chips, coffee, soft drinks, and apple pie.

They rechristened their business as a hamburger stand, and later turned the company into a franchise, with the Golden Arches logo being introduced in 1953 at a location in Phoenix, Arizona.

In 1954, Ray Kroc, a seller of Prince Castle brand Multimixer milkshake machines, learned that the McDonald brothers were using eight of his machines in their San Bernardino restaurant. His curiosity was piqued, and he went to take a look at the restaurant. He was joined by good friend Charles Lewis who had suggested to Kroc several improvements to the McDonald's burger recipe. At this point, the McDonald brothers had six franchise locations in operation.

In 1956, Ray Kroc met Harry J. Sonneborn, a former VP of finance for Tastee-Freez, who offered an idea to accelerate the growth and investment grade of Kroc's planned McDonald's operation: Own the real estate that future franchises would be built on. 

Kroc hired Sonneborn and his plan was executed through forming a separate company called Franchise Realty Corp. which was founded in order to hold McDonald's real estate. The new company signed leases and took out mortgages for both lands and buildings, in turn then passing these costs on to the franchisee with a 20-40% markup and a reduced initial deposit of $950.

In 1961 Kroc's conflict over the vision of the company with the founding brothers had grown to an unbearable extent, and he asked them how much money they wanted to leave their business to him entirely. The brothers asked for $2.7 million (about $21.6 million in today's dollars), which Kroc did not have.

Harry J. Sonneborn was able to raise the money for him, and Kroc bought the founding brothers out. This purchase laid the groundwork to positioning the company for an IPO and furthering the aim at making McDonald's the number one fast-food chain in the country. 

The exact process of how the company was sold is not well-recorded; it is depicted as a hostile takeover by Ray Kroc in the movie The Founder but that portrayal is disputed, and interviews of the time speak of a more voluntary transition.

Original McDonald's

Kroc and Sonneborn had a falling out over expansion of the company, leading to Sonneborn's resignation in 1967. Kroc took over the title of CEO and president.

😋Products of McDonald's:

McDonald's predominantly sells hamburgers, various types of chicken, chicken sandwiches, French fries, soft drinks, breakfast items, and desserts. In most markets, McDonald's offers salads and vegetarian items, wraps and other localized fare. On a seasonal basis, McDonald's offers the McRib sandwich. Some speculate the seasonality of the McRib adds to its appeal.