Restaurant and fast food industry working paper 5247

Restaurant and Fast-Food Industry,” Working Paper 5247, National Bureau of Economic Research, September 1995; Scott A. Shane, “Hybrid
Organizational Arrangements and their Implications for Firm Growth and Survival: A Study of New Franchisors,” Academy of Management
Journal, February 1996; H. G. Parsa, “Franchisee-Franchisor Relationships in Quick-Service-Restaurant Systems,” Cornell Hotel & Restaurant
Administration Quarterly, June 1996; Scott A. Shane and Chester Spell, “Factors for New Franchise Success,” Sloan Management Review,
March 22, 1998; Robert W. Emerson, “Franchise Terminations: Legal Rights and Practical Effects When Franchisees Claim the Franchisor
Discriminates,” American Business Law Journal, June 22, 1998. The Franchise Opportunities Guide, published annually by the International
Franchise Association, gives a rosy view of “the success story of the 1990s.” The Franchise Fraud: How to Protect Yourself Before and After
You Invest (New York: John Wiley & Sons, 1994), by Robert L. Purvin, Jr., regards the promises of franchisors with more suspicion. Mr.
Purvin — an attorney who serves as chairman of the board of trustees of the American Association of Franchisees and Dealers — helped to
ensure the accuracy of my legal analysis. Susan Kezios, president of the American Franchisee Association, spoke with me at length about the
legislative reforms being sought by her organization. Richard Adams, the president of Consortium Members, Inc., an alliance of disgruntled
McDonald’s franchisees, described some of the franchising practices of the world’s largest fast food chain. Rieva Lesonsky, the editorial
director of Entrepreneur magazine (which annually publishes the “Franchise 500: Best Franchises to Start Now!”) gave me a much brighter
view of the industry. Peter Lowe took time from his hectic schedule to discuss success. In addition to Dave Feamster, I interviewed a number
of other fast food franchisees who shall remain unnamed. I am grateful to Feamster not only for giving me free rein at his restaurant, but also
for allowing me to spend an evening delivering Little Caesars pizzas in Pueblo.
Page
94 “Instead of the company paying the salesmen”: Luxenberg, Roadside Empires, p. 13.
95 often earned more money than the company’s founder: See Emerson, Economics of Fast Food, p. 59; Love, Behind the Arches, pp. 171–
75.
“common sense”: Kroc, Grinding It Out, p. 111.
“any unusual aptitude or intellect”: Ibid., p. 111.
96 “We are not basically in the food business”: Quoted in Love, Behind the Arches, p. 199. See also Kroc, Grinding It Out, p. 109.
more than $180 million a year: By 1998, the year of Richard McDonald’s death, the annual system-wide sales of McDonald’s exceeded
$36 billion. Cited in “The Annual,” McDonald’s Corporation 1998 Annual Report.
“grinding it out”: Kroc, Grinding It Out, p. 123.
97 “Eventually I opened a McDonald’s”: Ibid., p. 123.