The Founder film provides some great insights into Ray Kroc’s success, and perhaps some vital lessons for many of today’s entrepreneurs and business owners.
Ray Kroc continues to be one of the most quoted of wealth business leaders and entrepreneurs. The new Founder movie dives into the success of McDonalds, and suggests many really know little about him, or what was really behind the success of the massive global food chain.
Given that Ray Kroc has built McDonald’s into an international chain with 7,500 locations, in 31 countries, bringing in $8B plus per year by the time he died, there certainly has to be some great insights to glean from his success. So, what helped great such massive success? What can today’s business owners and entrepreneurs apply to their own ventures?
Branding
McDonald’s golden arches are unquestionably one of the most well-known and iconic brand images of all time. In fact, the new film not only talks about the arches, but the value Ray Kroc saw in the name ‘McDonald’s’. Naming and logos are still so vitally important. Yet, many Realtors, real estate investors, and startups fail to put much thought into their company names and logos today. This food giant may have succeeded because of its name, and may never had been heard of without it. Remember that.
Systems
McDonald’s is all about systems. Its systems have certainly set it apart, and enabled its expansive growth. It’s really hard to deliver a consistent experience, a good experience, or to scale your business without systems. You certainly won’t be as profitable without them. As Ray Kroc discovered often the greatest brands and businesses aren’t reliant on your own creative thinking, organization, or innovation, but in adopting existing systems that are working well.
Speed
Where McDonald’s really set itself apart at the beginning and for many decades was its speed. They built their workspaces for speed, and could deliver what customers wanted immediately. If speed was important back then, it is 100x more important today. How much faster is your business compared to the competition.
Franchising
McDonald’s grew on the back of franchising. It still does. Investors buy franchises, plug in the systems, and pay royalties on their revenues. Franchising has great advantages. It can take work to setup and maintain. But, there can be big lump sums and ongoing passive income to be had, along with lower overhead and risk than corporate owned expansion efforts.
Add-On Services
The Founder film with Michael Keaton shows the value of add on services too. Whether you are supplying franchisees, or expanding your service offering direct to consumers; the more of the experience you control and deliver, you are able to increase profit per customer and total revenues, as well as being able to ensure a seamless and consistent process.
Real Estate
The story of McDonald’s success is really a story about real estate. According to the film Ray Kroc mortgaged his home to get the money to grow McDonald’s. Despite numerous locations, the company was failing. The profit just wasn’t there. It wasn’t until working until Kroc was introduced to the fact that what he should have been in was the real estate business. Then the restaurants and food franchise just became a way to feed and support the real estate business.
Partnerships
We wouldn’t have McDonald’s like we know it if it wasn’t for partnerships. We probably would have never heard of Ray Kroc. Yet, at the same time partnerships can be risky and heartbreaking. Make sure you partner with the right people, for the right reasons, and have bulletproof paperwork. Finally, how you do business will directly affect your legacy. Do it right and that can payoff, and become an inspiration for generations. Do bad business, and no amount of philanthropy, book writing, or quotes may be able to overcome your reputation and change what you are know for.
