The term or idea of a “restaurant” has been around hundreds of years. They started out as simple tea houses or taverns, but when traveling became easier, people wanted a way to have a nice, home-cooked meal on the road instead of bringing their own food and attempting to cook a good meal along the way. This began the growth of all types of restaurants around the world. Italian, Chinese, Thai, Mexican, and eventually American restaurants could be found in any city. By the 1900s, traveling around the country or even across seas was no issue, and ways of refrigeration and preservation were becoming easier as well. I think these two things helped the idea of franchising grow. Families were beginning to bring their own lunches in coolers on road trips, so the need to stop at a restaurant for every meal was dying out. Plus, many people didn’t want to take the hour or so time out of their day to sit down at a restaurant and eat a full meal. Like I have stated in my past blog posts, in the 1950s, Ray Kroc came up with the idea of a fast and efficient type restaurant where people can buy their food quickly and return to their daily routine.
This idea of franchise restaurants caught on very fast; and the industry has profited ever since. Just like regular, sit-down restaurants, there are franchises that serve Italian, Mexican, American, and Chinese food so that they can relate to any culture around the world. Fast food restaurants first caught on during the Industrial Revolution. More people began working away from home, and that required them to find another way to eat lunch, or dinner on the way back home. For lunch, they didn’t have the option to take their time and return home for a meal, so street vendors, drive-in restaurants, and food stands became the new way to get a fulfilling meal during their lunch break. The new trend for our culture today is the necessity for people to obtain what they want as fast as possible. The invention of cell phones instead of land lines, laptops replacing desktop computers, and even the combination of internet on your cell phone are just some of the ways our society has changed. People want all information right at their fingertips, and this has transferred to the availability of food as well. In the future, I think that this trend will last a very long time, and the franchising industry will stay strong for many decades to come as well. So far, they seem to know exactly how to cater to their customers, so it will be interesting to see the ideas companies come up with in the future to improve the system even more.
Fast-food has even branched out to other areas. If you go to your local county fair, there are many food booths that are franchised out. For example, the Dippin’ Dots franchise has only been around for about 15 years, but already, they have been able to catch on to the public’s interest. Not to mention pretty much anyone loves to eat ice cream on a hot summer day at the fair. Another way franchise restaurants have expanded their business is by partnering with department or retail stores. Wal-Mart pairing up with McDonalds has been going on since the mid 1990s. Their main objective: if customers get hungry while shopping, or their children start to get fussy, all they have to do is walk over to McDonalds and buy a burger or Happy Meal. This keeps the customers in the store and makes it more convenient for them to finish their shopping (or buy more than they would if they had to leave for food). By 2007, there were about 700 McDonald’s restaurants in Wal-Mart stores and supercenters, and I have no doubt that this number has grown in the past three years. In 2008, an article was written about the two companies and how, despite the recession of the United States, Wal-Mart and McDonalds have not hurt financially. More specifically, in the Dow Jones stock index, there are thirty companies that make up this index. Wal-Mart and McDonalds were the only two that had an increase of stock price compared to 2007. One thing that both these companies have in common is their low prices. This can be seen in McDonalds with their Dollar menu and Wal-Mart with their “rollback savings”. Of course, during a recession, families look to save money more than when the economy is doing well. Therefore, they are more likely to shop at these types of companies. The success of their popularity impacted their growth as a company all around the world. In the past few years, Subway has also paired up with Wal-Mart stores around the United States. This could be partly because (as I have mentioned before) that customers are becoming more conscious of what they are eating and looking more towards healthy foods. This is just another way that franchise companies are making it easier for the consumer to find what it wants quickly and with little effort.
With the healthy trend exploding in the United States, as well as around the world, it is interesting how franchise restaurants alter their menus to keep up with the needs of their consumers. According to the National Center for Health Statistics, 66.5% of American adults are overweight or obese, and 19% of children are overweight. This is not a good statistic, and is also bad news for the majority of the fast food industry. People are becoming less inclined to “super-size” their meal, and are opting for water with their meal instead of soda. Therefore, a new challenge has presented itself to franchises. They need to come up with menu items that are still able to be prepared in a short amount of time, are reasonably in-expensive, and still an item that customers would want to buy. Subway restaurants have succeeded in providing menu items that are tasty, but are relatively healthy. For example, recently they have been promoting their 8 subs with 6 grams of fat or less option which gives customers a variety of low fat sandwiches to choose from. This option gives Subway an advantage over other fast-food restaurants because of their large number of healthy options, which in turn, increases their profit and allows them to expand and grow even more. Despite the fact that other franchise restaurants are trying to be healthier, for the past few decades, society has become used to thinking of McDonalds or Burger King as the place to go if you want a good burger or fries, not a nice salad or grease free sandwich. Breaking away from this label will be a challenge for many years because they have put in so much time and money to let consumers know what their most delicious and popular products are.
One of the issues with healthy, fresh food is that it can be a bit more expensive. I think this is another reason why the healthy menu items at McDonalds, Taco Time, etc., are not selling well. People come to those restaurants because in past visits, they know that their food is cheap. When looking at the menu and comparing the items, they are more likely to buy the cheaper item, which is usually more processed and not as healthy. At the newer fast food restaurants that are known for their healthier selection, customers know what to expect and won’t mind as much to spend a few more dollars. As this trend continues, I am curious as to how the various types of fast food restaurants will change their ad campaigns and menu to what the general public wants.
The future of franchises is a popular topic for economists, businessmen, and consumers. For the most part, any franchise restaurant in the United States that opens is likely to have a decent amount of business and will be profitable. I have already discussed why this is, because of their skills in fast, efficient, and dependable service. Will this success continue in the future? Or will some new way of finding a quick meal be invented, driving away the fast food franchise business? One source says, “Within a decade or less, franchising will comprise over 50% of the retail economy, will employ millions of people, and will enable hundreds of thousands to realize the American dream of successful business ownership.” The opportunity for more jobs is definitely a positive aspect for the future and could help get the United States out of the current recession. But are these the jobs we want the majority of our society to have? Optimistically, it is better than no jobs. With the current recession and layoffs, people are turning to the opportunity to open up their own restaurant because it has proven to be a thriving investment. Also, as the number of franchise owners increases, the amount of power they have increases as well. Currently, the overall franchisor has the majority of power in what the restaurants need to look like and what to serve as well as how much in fees the franchise owner needs to pay. Some predict that this balance might shift in the future to give more benefits to the franchise owner. As cities all over the world grow, this will also lead to growth in the fast food industry. China and the United States are two countries who are seeing major growth. The population is increasing, meaning there are more mouths to feed in a concentrated area. Because of this, I believe the future will consist of a lot growth in franchise restaurants, especially in these two countries.
Overall, I don’t think franchise restaurants will be going away anytime soon. This idea of “fast” food has impacted our society way too much, and I believe that now, we couldn’t live without it. The fact that chain restaurants can be found on pretty much every continent or country proves this point. As a whole, the industry is very profitable, even through times of bad economies and protests against the companies. The strength globally will help them grow even more in the future and keep customers coming to buy their food. In our lifetime, and probably our children’s lifetime, I am guessing they will still have the opportunity to buy the famous Happy Meal.
Sources:
Franchising
The History of Restaurants
Food Timeline
Dippin Dots
McDonald's, Walmart strengthening partnership
McDonalds and Walmart beating the recession
Walmart and Subway
Healthy Fast Food
Healthy Fast Food Blog
Future of Franchising
Thursday, April 29, 2010
Friday, April 16, 2010
Technology and Franchises
Ray Kroc could probably be called one of the smartest men in history. Creating the idea of franchise restaurants has made the food industry grow incredibly fast, and will continue to do so for many years to come. In our society today, it has become easier and easier for companies to expand their stores and increase their profit. I am going to talk about the major reasons why franchise restaurants will continue to flourish in the future.
First off, technological advances in the past twenty years along with future inventions are making fast-food restaurants profit in so many ways. When the internet was first invented, all types of companies began creating websites for the general public to go to and see their products, specials, locations, and other general information about the business. Some companies have even created the option to place an order online so the customer doesn’t even have to call into the store. One specific example of this website phenomenon is nutritional information. In the past few years, the trend of eating healthy has become very popular. Franchise companies whose main types of food are deep-fried, full of butter, or just plain unhealthy find it a little discouraging to display the nutritional information right on the menu. To fix this problem, they chose to provide the information on their website, hoping that the general public will forget to look and see the calorie content by the time they get back home.
These companies pride themselves in the amount of locations they have over the world, and love to display it on their home page. If you go to www.subway.com, they even have a counter that tells the number of restaurants they have (32,721 in 91 countries). Another benefit to the internet is the ease of communication. I believe that the idea of franchising came when it did because the ability to transport products, correspond with restaurants across the world, and reach out to the public was becoming easier during the mid 1900’s. Furthermore, when the internet was invented (especially email), this became even easier for the corporations. Companies have even branched out their advertisements to other websites such as Facebook and Television Networks.
Technology can even be looked at in a nutritional aspect. As scientists and nutritionists find new ways to develop healthy alternatives to fats and sugar, the general public will be more inclined to buy their food. In turn, this would increase profit and the ability to expand even more around the world.
I think that no one can really know for sure how fast the franchise industry will develop in the near and far future. There will definitely be growth and more globalization, despite the difficulties the industries come across with the media and competition. It is going to be very interesting to watch these new ways of reaching out to the consumers break through.
Sources:
The future of franchising
The McModel
Click HERE to open the feedback tool.
First off, technological advances in the past twenty years along with future inventions are making fast-food restaurants profit in so many ways. When the internet was first invented, all types of companies began creating websites for the general public to go to and see their products, specials, locations, and other general information about the business. Some companies have even created the option to place an order online so the customer doesn’t even have to call into the store. One specific example of this website phenomenon is nutritional information. In the past few years, the trend of eating healthy has become very popular. Franchise companies whose main types of food are deep-fried, full of butter, or just plain unhealthy find it a little discouraging to display the nutritional information right on the menu. To fix this problem, they chose to provide the information on their website, hoping that the general public will forget to look and see the calorie content by the time they get back home.
These companies pride themselves in the amount of locations they have over the world, and love to display it on their home page. If you go to www.subway.com, they even have a counter that tells the number of restaurants they have (32,721 in 91 countries). Another benefit to the internet is the ease of communication. I believe that the idea of franchising came when it did because the ability to transport products, correspond with restaurants across the world, and reach out to the public was becoming easier during the mid 1900’s. Furthermore, when the internet was invented (especially email), this became even easier for the corporations. Companies have even branched out their advertisements to other websites such as Facebook and Television Networks.
Technology can even be looked at in a nutritional aspect. As scientists and nutritionists find new ways to develop healthy alternatives to fats and sugar, the general public will be more inclined to buy their food. In turn, this would increase profit and the ability to expand even more around the world.
I think that no one can really know for sure how fast the franchise industry will develop in the near and far future. There will definitely be growth and more globalization, despite the difficulties the industries come across with the media and competition. It is going to be very interesting to watch these new ways of reaching out to the consumers break through.
Sources:
The future of franchising
The McModel
Click HERE to open the feedback tool.
Friday, April 9, 2010
Resources:
Food, Inc. Movie
This website is for the movie that came out in 2009 called Food, Inc. Over the summer, I was able to watch the movie and learned a lot about where fast food chains get their food products and what issues there are around the topic. It was very eye opening and hopefully other viewers felt the same way. The website conveniently provides more information about the issues, how to get involved, and further sources to look at for information.
Advantages and Disadvantages of Franchising
When looking at the advantages and disadvantages of franchises, this website was helpful with providing straight-forward information. I also like how it was laid out with all the different aspects that go into a franchise and all the important things the company, owner, and even the workers care about.
Franchising and Globalization
For my first blog post, I gave a semi-brief overview of franchising and fast-food restaurants around the world. It provided some insight on reasons why the franchise idea is so successful and what it does to make the most profit. One thing that not many people realize is that even though the franchise industry has grown very fast, it does provide hundreds of thousands of jobs for people (including myself at the moment!) all over the world, and this helps our economy. I also liked how it talked a little bit about the future of franchises and what direction they are expected to go in the future.
McDonals Globalization and Culture
McDonald’s is one of the most famous fast-food franchise restaurants in the world. This website provided information about the globalization of the McDonald’s company and how much it has grown. One big step for not only McDonalds, but all franchises, is the expansion outside of their “home” country. The article talks about how the public and general economy reacted when McDonalds went global and grew to the popularity that it has today.
Food Franchises
I thought this website was useful for two reasons. First off, it gave me some background information about how McDonalds went from being a small chain of restaurants to an actual franchise. It also talked about the history of franchising as a whole and how the idea of became so successful in the United States and other countries.
Globalization vs Local Culture
In this shorter article, there was more of a personalized feel as to how fast-food restaurants have affected various cultures. The author talks about how she went to India and watched how the American culture influenced small changes in other countries. When various American franchises expanded outside the United States, the different cultures began to catch on to the fast-food market and showed interest in these popular chains growing around their cities. I thought this was interesting to read a real account of what these people thought of the franchises.
Fast Food Restaurant
This website concentrated on the history of fast-food, even dating back to the Middle Ages in Europe. Obviously, the idea of fast and convenient food has been around for centuries, but it was interesting to see the development from local street vendors to enormous fast-food chain restaurants like we have throughout our cities today. It also touched on some of the issues that franchises have to deal with, like health problems, labor violations, and how much they are present in our society.
The Globalization of McDonaldization
The article on this website focuses on the globalization of McDonalds and what tactics the company uses to increase profit. It mentions four ways that McDonalds (and I’m assuming other franchises) uses to structure their business around. They are efficiency, calculability, predictability and control. These four aspects are helpful for my topic because I could look into them and see how each company factors these elements into their business, and why exactly they are so successful.
Subway's Healthy Food?
In our society today, the theme of eating health any losing weight has become very popular. This, however, is not a good trend for fast-food restaurants, which tend to sell unhealthy, deep-fried, and heavily processed food. I thought this was helpful because it talks about one aspect that the companies try not to broadcast much, but is still a big issue. Recently, these companies have come out with menu options and ad campaigns to keep their sales strong. What many people may not know though is that the “healthy” options might not be as healthy as they think.
A New Fast-Food Invasion
This Time magazine article is about how fast-food restaurants have exploded in out of the United States and into other countries. When this happens, it inspires other business men and women to open up their own fast-food restaurant because they see how successful other restaurants are. However, this idea just adds to the problem of globalization and the number of franchise chains there are all over the world. I could use this source to add support to the idea of how the globalization of franchises has affected different communities around the world.
The Dominance of Western Fast Food
On this website, there is a collection of three articles specifically on how fast food chains have influenced the Asian culture. Before there was much globalization, Asia didn’t see very many restaurants with American food. This spread of franchises has had a large impact on their culture and the type of food they eat today. I think it is a valuable source because it is looking at globalization of restaurants from another country’s point of view.
Globalization and Culture
What I liked about this article is how it explains the convenience that fast food restaurants provide for their customers so they can get their food, fast. The concept is something that sit-down restaurants usually can’t provide, and when families are running around going from point A to point B, a drive-thru restaurant is the perfect solution to getting a meal or snack.
Fast Food
I used this website page to get some general information about fast food restaurants, their history, the overall idea of fast food, and criticisms of it. At the bottom of the page, it also provided additional links that could add more sources for my final project. I felt that the article page was well written and the information was correct, despite the fact that it is from Wikipedia.
The History of Franchising
As the title suggests, this article is about the history of franchising. It is a little weird to think about the fact that there will probably never be a day where there are no franchise restaurants. I found this article useful because it did a good job of laying out the course fast food restaurants followed in the past two hundred years and how they came to be where they are today.
Fast Food's Hidden Dangers
I thought this webpage did a good job of talking about some of the controversial issues with the fast food industry. Health problems, the safety of meat packaging factories, and food poisoning are all very present problems in our world today. It is very important to make sure these issues are known and the right information is out there, because as fast food companies grow bigger and bigger, so do the problems. These companies will do anything they can to not expose negative information that could possibly cause them to lose business.
Food, Inc. Movie
This website is for the movie that came out in 2009 called Food, Inc. Over the summer, I was able to watch the movie and learned a lot about where fast food chains get their food products and what issues there are around the topic. It was very eye opening and hopefully other viewers felt the same way. The website conveniently provides more information about the issues, how to get involved, and further sources to look at for information.
Advantages and Disadvantages of Franchising
When looking at the advantages and disadvantages of franchises, this website was helpful with providing straight-forward information. I also like how it was laid out with all the different aspects that go into a franchise and all the important things the company, owner, and even the workers care about.
Franchising and Globalization
For my first blog post, I gave a semi-brief overview of franchising and fast-food restaurants around the world. It provided some insight on reasons why the franchise idea is so successful and what it does to make the most profit. One thing that not many people realize is that even though the franchise industry has grown very fast, it does provide hundreds of thousands of jobs for people (including myself at the moment!) all over the world, and this helps our economy. I also liked how it talked a little bit about the future of franchises and what direction they are expected to go in the future.
McDonals Globalization and Culture
McDonald’s is one of the most famous fast-food franchise restaurants in the world. This website provided information about the globalization of the McDonald’s company and how much it has grown. One big step for not only McDonalds, but all franchises, is the expansion outside of their “home” country. The article talks about how the public and general economy reacted when McDonalds went global and grew to the popularity that it has today.
Food Franchises
I thought this website was useful for two reasons. First off, it gave me some background information about how McDonalds went from being a small chain of restaurants to an actual franchise. It also talked about the history of franchising as a whole and how the idea of became so successful in the United States and other countries.
Globalization vs Local Culture
In this shorter article, there was more of a personalized feel as to how fast-food restaurants have affected various cultures. The author talks about how she went to India and watched how the American culture influenced small changes in other countries. When various American franchises expanded outside the United States, the different cultures began to catch on to the fast-food market and showed interest in these popular chains growing around their cities. I thought this was interesting to read a real account of what these people thought of the franchises.
Fast Food Restaurant
This website concentrated on the history of fast-food, even dating back to the Middle Ages in Europe. Obviously, the idea of fast and convenient food has been around for centuries, but it was interesting to see the development from local street vendors to enormous fast-food chain restaurants like we have throughout our cities today. It also touched on some of the issues that franchises have to deal with, like health problems, labor violations, and how much they are present in our society.
The Globalization of McDonaldization
The article on this website focuses on the globalization of McDonalds and what tactics the company uses to increase profit. It mentions four ways that McDonalds (and I’m assuming other franchises) uses to structure their business around. They are efficiency, calculability, predictability and control. These four aspects are helpful for my topic because I could look into them and see how each company factors these elements into their business, and why exactly they are so successful.
Subway's Healthy Food?
In our society today, the theme of eating health any losing weight has become very popular. This, however, is not a good trend for fast-food restaurants, which tend to sell unhealthy, deep-fried, and heavily processed food. I thought this was helpful because it talks about one aspect that the companies try not to broadcast much, but is still a big issue. Recently, these companies have come out with menu options and ad campaigns to keep their sales strong. What many people may not know though is that the “healthy” options might not be as healthy as they think.
A New Fast-Food Invasion
This Time magazine article is about how fast-food restaurants have exploded in out of the United States and into other countries. When this happens, it inspires other business men and women to open up their own fast-food restaurant because they see how successful other restaurants are. However, this idea just adds to the problem of globalization and the number of franchise chains there are all over the world. I could use this source to add support to the idea of how the globalization of franchises has affected different communities around the world.
The Dominance of Western Fast Food
On this website, there is a collection of three articles specifically on how fast food chains have influenced the Asian culture. Before there was much globalization, Asia didn’t see very many restaurants with American food. This spread of franchises has had a large impact on their culture and the type of food they eat today. I think it is a valuable source because it is looking at globalization of restaurants from another country’s point of view.
Globalization and Culture
What I liked about this article is how it explains the convenience that fast food restaurants provide for their customers so they can get their food, fast. The concept is something that sit-down restaurants usually can’t provide, and when families are running around going from point A to point B, a drive-thru restaurant is the perfect solution to getting a meal or snack.
Fast Food
I used this website page to get some general information about fast food restaurants, their history, the overall idea of fast food, and criticisms of it. At the bottom of the page, it also provided additional links that could add more sources for my final project. I felt that the article page was well written and the information was correct, despite the fact that it is from Wikipedia.
The History of Franchising
As the title suggests, this article is about the history of franchising. It is a little weird to think about the fact that there will probably never be a day where there are no franchise restaurants. I found this article useful because it did a good job of laying out the course fast food restaurants followed in the past two hundred years and how they came to be where they are today.
Fast Food's Hidden Dangers
I thought this webpage did a good job of talking about some of the controversial issues with the fast food industry. Health problems, the safety of meat packaging factories, and food poisoning are all very present problems in our world today. It is very important to make sure these issues are known and the right information is out there, because as fast food companies grow bigger and bigger, so do the problems. These companies will do anything they can to not expose negative information that could possibly cause them to lose business.
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