Mcdonald's Beef-Fries Controversy

Topics: Fast food, McDonald's, Hamburger Pages: 4 (1081 words) Published: March 11, 2013
Beef-Fries Controversy
McDonald's was started as a drive -in restaurant by two brothers, Richard and Maurice McDonald in California, US in the year 1937. The business which was generating $200,000 per annum in the 1940's,got a further boosts with the emergence of a revolutionary new concept called ''self-service''. The brothers designed their kitchen for mass production with assembly line procedure. By mid.1950's restaurant's revenue reached $350,000. As word of their success spread, franchisees started showing interest. However, franchising system failed because the McDonald brothers observed very transparent business practices. As a consequence, they encourage imitators who copied their business practices and emerged as a competitors. The franchisees also did not maintain the same standards for cleanliness, customer service and product uniformity. By this point, Ray Kroc, a distributor for milkshake machines finalized a deal with the mcdonald’s brothers and Mcdonald’s went public. By the end of 1970’s, Mcdonald’s had over 5000 restaurants with sales exceeding millions. However, in the early 1990’s, Mcdonald’s was facing problem due to changing customer preferences and increasing competition. Customers were becoming increasingly health conscious and they wanted to avoid red meat and fried food. They also preferred to eat at other fast-food joints that offered discounts. During this time, Mcdonald’s also faced increased competition from supermarkets, convenience store, local delicatessens, gas stations and other outlets selling reheatable food. In May 2001, a class action lawsuit was filed against the world's largest fast-food chain McDonald's, in Seattle, US. The lawsuit alleged that the company had, for over a decade, duped vegetarian customers into eating French fries that contained beef extracts. The lawsuit followed a spate of media reports detailing how the French fries served at McDonald's were falsely promoted as being '100%...
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