Mickey D's at 50

McDonald's is 50 years old today. Well, not really, but today is the official birthday. Dick and Mac McDonald started their hamburger stand in San Bernadino, California, in 1948, but it took a visit from Ray Kroc, seller of milk-shake machines, to start the business as it is known today. He arranged the first franchise of McDonald's which opened 50 years ago today in Illinois. The rest, as they say, is history.

The McDonald brothers had discovered the assembly line production method worked with hamburgers just as well as with automobiles. But it took Mr. Kroc to realize that the business model was scalable -- that it would work anywhere a minimum wage staff could be disciplined enough to make it his way. In 1961, to assure this discipline and consistency existed throughout his growing empire, he opened Hamburger University in Illinois. Which gave rise, along with rather stupid course offerings in the 1960s and 1970s at American colleges, to Clive James once commenting, "Everyone has a right to a university degree in America, even if it's in Hamburger Technology."

There is competition from Burger King and Wendy's (which serve superior burgers, and inferior fries) and there are those who would like to be the competition, such as White Castle (a chain mercifully restricted to the Eastern Seaboard of the US, which "steam-grills" it's burgers -- proving that the western half of the nation is the more civilized). But it is McDonald's that has embedded itself in the globalizing culture.

After all, a "McJob" is largely understood in numerous versions of the English tongue. The protester against the unification of world culture rarely attack Wendy's. And when the Economist chose a global standard to measure purchasing power parity in different nations, the ubiquity of the Big Mac (121 countries as of today) was a ready made standard. By comparing the price of a Big Mac in Moscow and Medellin, the magazine could determine who much the local currency really bought. And when the restaurant opened in Pushkin Square in Moscow, it was clear the Cold War had ended and the West had won.

The challenges ahead for McDonald's are obvious -- the obesity epidemic, the flagging profits from non-US operations, and its identification with the dark side of globalism. It is almost certain to survive, and continue to make McFood. With sales around $40 billion a year, it is hard to see it vanish forever. Yet 50 years ago, there were Nash Rambler and Studebaker cars, a Dumont TV network, and a department store called Gimbels. In 2055, there might be a heck of a party at McDonald's, but there's no guarantee. That's the nature of the market.


© Copyright 2005 by The Kensington Review, J. Myhre, Editor. No part of this publication may be reproduced without written consent.
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