Fast Food Nation

The distinctive architecture of each chain became its

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: of hard work.” Becoming a successful McDonald’s franchisee, he noted, didn’t require “any unusual aptitude or intellect.” Most of all, Kroc wanted loyalty and utter devotion from his franchisees — and in return, he promised to make them rich. While Kroc traveled the country, spreading the word about Mc-Donald’s, selling new franchises, his business partner, Harry J. Sonneborn, devised an ingenious strategy to ensure the chain’s financial success and provide even more control of its franchisees. Instead of earning money by demanding large royalties or selling supplies, the McDonald’S Corporation became the landlord for nearly all of its American franchisees. It obtained properties and leased them to franchisees with at least a 40 percent markup. Disobeying the McDonald’s Corporation became tantamount to violating the terms of the lease, behavior that could lead to a franchisee’s eviction. Additional rental fees were based on a restaurant’s annual revenues. The new franchising strategy proved enormously profitab...
View Full Document

This note was uploaded on 02/25/2014 for the course MGMT 120 taught by Professor Litt during the Spring '08 term at UCLA.

Ask a homework question - tutors are online