ECO 201 Final Paper.doc - 1 Running head MCDONALD\u2019S McDonald\u2019s Carmen Concepcion Southern New Hampshire University ECO 201 2 McDonalds Starting up a

ECO 201 Final Paper.doc - 1 Running head MCDONALD’S...

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1 Running head: MCDONALD’S McDonald’s Carmen Concepcion Southern New Hampshire University ECO 201
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2 McDonalds Starting up a business and keeping it running is no easy task. It’s more than just creating a product and selling it. It’s creating a product that consumers will want to purchase at a reasonable price. You also must take into account the cost of purchasing the materials, labor and marketing your product. I will be conducting a research on McDonald’s, a well-known franchised fast food restaurant. With this report I will show you how they are able to stay in business for over 60 years. You will see how the supply and demand, price elasticity of demand, and cost of production all play an important role in a business. History of the Company The first McDonald’s was opened in 1948 by two brothers, Maurice and Richard McDonald. In 1954 Ray Kroc became the franchise agent for the McDonald brothers. In April 1955 he opened the first McDonald’s franchise restaurant in Des Plaines, Illinois and sales were $366.12 on the first day. In that same year the McDonald’s Corporation was launched. Ray’s vision was to have 1,000 McDonald’s restaurants in the United States. In 1961 McDonald’s purchased the rights to the brother’s company for $2.7 million. McDonald’s continues to grow and today there are over 36,000 restaurants in over 100 nations. The latest one opening in Kazakhstan in 2016. Since McDonald’s is a franchised business Ray decided to open a Hamburger University in 1961 so that the franchisees would get the proper training on how to run a successful McDonald’s restaurant. More than 275,000 franchisees, managers and employees have graduated from this university. As the franchises grew, so did the items that were added to the national menu. The fillet of fish was added to the national menu in 1965 by a franchisee in Cincinnati to help build volume since the restaurant was located in a Roman Catholic community. In 1968 the Big Mac was added by a franchisee in Pittsburgh. Next, in 1973 the Quarter Pounder and the Quarter Pounder with
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3 cheese was added to the menu. A franchisee in California added the Egg McMuffin in 1975 and in 1983 the Chicken Nuggets was added to all U.S. domestic restaurants. The first McDonald’s in Moscow opened in 1990 and served over 300,000 customers. In 1993 Melbourne, Victoria Australia opened the world’s first McCafé. The McFlurry was invented by a franchisee in Canada and was added to the Canada menu. In 2015 All Day Breakfast was launched in McDonald’s U.S.A. McDelivery with UberEATS was globally launched in 2017. Current Goods and Services McDonald’s offers an array of foods: fries, the Big Mac, chicken sandwiches, chicken nuggets, hamburgers, cheeseburgers, the quarter pounder with cheese, salads, wraps, desserts, soft drinks and beverages. They also offer a variety of breakfast items: McMuffins, McGriddles, Biscuits and Bagel sandwiches, burritos, hotcakes, the Big Breakfast, parfaits and Hash Browns.
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