Summary of the movie
The movie starts off with the main protagonist Ray Kroc who is a traveling salesman. He owns Prince PC Castles and is selling milkshake mixers (sales division). The setting takes place in the United States, in the early 1950s. He is not very successful but he has house and wife, Ethel, who asks him “When it will be enough?” He replies saying ‘Never'. He does research and learns about a drive-in in San Bernardino that has a large number of milkshake mixers. He plans his destination and goes there. Ray arrives in California and comes across McDonalds. He is shocked when he orders his food and it's already made and correct. Usually he expected the order would take long and it wouldn't be what he asked for. The restaurant is very popular owing to its fast services, high quality food, disposable packaging and peaceful environment. Ray then meets the two who started McDonalds – Maurice and Richard McDonald – which leads to them showing Ray their kitchen and well their workforce is. They tell Ray it's called the Speedy System where burgers are ready in less than a minute. Ray asks why don't they try franchising and the brothers said they had attempted it but because of inconsistent and absent owners led to failure. Ray manages to convince them to let him be a franchisee on condition that he abides to the contract. Ray goes to the bank and re-mortgages his house for extra capital to buy land and build a McDonalds restaurant. Ray tries to persuade the wealthy investors at the country club to open franchises but saw the same poor management which will lead to insolvency. He then has a bright idea to ask the middle class investors because he knows they will be committed to the McDonalds formula. The idea is very successful because there were McDonalds opening throughout the Midwest. Ray travels to Minnesota to meet Rollie Smith, a wealthy restaurant owner who wishes to invest and his wife Joan in which Ray finds her very attractive. Rays tell Rollie and Joan that he is having financial difficulties because of the large quantities of ice-cream and how much it costs for ice-cream as well as his share of franchise profits (1.4% royalty to Croc and 1.5% to McDonalds). Joan introduces to Ray powdered milkshake which to avoid the cost for ice-creams. He then asks the brothers but they said no due to the quality of the food. With the increase of debts and the repossession of his house, he goes to the bank to renegotiate the loan but is denied. A certain man overhears this and this man is Harry Sonneborn who is a financial consultant. Ray allows him to go through the financial books and tells Ray that there is an opportunity to receive real profit by giving real estate to the franchisees. This will not only provide extra profit but give him leverage over Maurice and Richard and his franchisees. Ray changes his original company to Franchise Reality Corporation which upsets the brothers and Ray buys the powdered milkshake and distributes the product to other franchisees. He divorces his wife Ethel but leaves her keep the house and doesn't share or give her some of the profit. Ray then renames the company to The McDonalds Corporation which made the brothers furious and Ray tells the brothers to release him from his contract so he can buy their Business. When Mac hears this he has a diabetic shock and is taken to hospital and Ray visits them and hands over blank cheque. They agreed to $2.7 million and 1% annual royalty, however, Ray denies that the brothers should have the royalty in the settlement and decides to do a handshake deal. The brothers' names are taken out of the McDonalds name, Ray builds a McDonalds restaurant across the street to put the brothers out of business. Towards the ending of the film Ray is standing in front of mirror in an elaborate mansion praising himself for his success and his new wife Joan.
Management, leadership, entrepreneurship
The brothers had excellent management ethnic. First they had a vision for a business and had the necessary resources to achieve this. Planning is the second step where for number of days the brothers drew out the kitchen, work stations and employees names. Maurice showed the workers where and how they should be moving around in the kitchen. They came up with a name for this system and that is the Speedy System. They showed leadership and led their employees to their full potential and performed their jobs meticulously. The brothers had complete positive control over the company and workforce and there were no mistakes or unethical actions performed. My opinion is that the McDonalds brothers planned perfectly, trained employees well and manages the business with skill. Ray tried to keep his business sustainable by being committed to selling his milkshake mixer and went to numerous businesses to sell it but was always rejected. After becoming a franchisee he showed some leadership and motivated Fred Turner who turned the patties. He managed the McDonalds with care by cleaning up after consumers and customers and always checked the burgers making sure it had what it said on the contract. Ray took the risk of re-mortgaging his house in order to do something better which led to him being the most successful businessman. The brothers took the risk of franchising again. They had an autocratic leadership which saves time and everybody follows.
7Ps of Marketing
The business really didn't have competitors but they did manage to create and sustain a fast food service which people needed and they did it, creating a competitive advantage. They made source dispensers so it is easier to apply source to the burgers. When customers bought the product it came in a bag which had the logo of the business and name as well as the cup that contained the milkshake. The burger wrapped in the paper has the logo. For a burger and milkshake was only 15 cents and long lines of people wanting to buy from McDonalds. The business is established is an urban area and not around other food businesses therefore leading to more profit. The business never did promotions. The business provided a service and the employees never showed anger and never impolite. Employees always had smile on their face, staff morale was good never stop being good at the stations they were given and never argued. The business has the appearance of employees in uniform, store presented properly – big sign and how much it costs – Richard gave Ray a business card. When customers approach they are greeted politely and is asked what they like, immediately gives them what they asked and says goodbye in polite way. Meals are already made and ready to sell to customers. Customers are first priority and employees don't slack and ignore consumers.
Branding and Franchising
When Ray became a Franchisee he signed the Franchising Agreement, the fee was $12500 and for the royalties 1.4% to Ray Croc and 1.5% to McDonalds. Ray gathered other franchisees and had many McDonalds open and the reason it became so popular. In the office when he was looking at the design of a new McDonalds restaurant he saw an opportunity and used the golden archers which attracted everyone. Ray is also brand loyal like in the movie in charge of pickles only put one but it's meant to have two and Ray told him that there has to be two. Ray also cared about the brand image and towards the end of film when Richard asks Ray why did he not steal the idea and run off. He said that the name of the business didn't stand out and the true value of McDonalds is the name itself and he took that opportunity. The business used golden/yellow archers and red to attract customers' eye, big bright colours.
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