Ray Kroc



Born: October 5, 1902
Oak Park, Illinois
Died: January 14, 1984
San Diego, California
Cofounder, McDonald's Corporation

Ray Kroc. Reproduced courtesy of the Library of Congress.
Ray Kroc.
Reproduced courtesy of the Library of Congress.

In his career as a salesman and business owner, Ray Kroc not only took advantage of opportunities others offered him, he also made some of his own. Kroc saw that brothers Richard (died 1998) and Maurice McDonald (c. 1902-1971) had created something special with their San Bernardino, California, hamburger restaurant. Kroc used his skills to turn the McDonalds' formula into the world's most successful restaurant chain.

"I have always believed that each man makes his own happiness and is responsible for his own problems.… It follows, obviously, that a man must take advantage of any opportunity that comes along."

A Gift for Selling

Raymond Albert Kroc was born on October 5, 1902, in Oak Park, Illinois, just outside of Chicago. He was the eldest child of Louis Kroc, an employee of the telegraph company Western Union, and Rose, a homemaker. Kroc's mother earned extra money teaching piano, and her son shared her talent at the keyboard. Kroc was also fond of daydreaming; his parents sometimes called him "Danny Dreamer" after catching him lost in thought. In his autobiography, Grinding It Out, Kroc wrote that his daydreams were not wasted, because "they were invariably linked to some form of action."

Kroc's first leap into business was with a lemonade stand he ran while he was in grammar school. His next business venture was running a music store that he opened with two friends after his freshman year in high school. They shut the store after several months. Kroc also served customers at his uncle's soda fountain, selling ice cream and other refreshments. There, Kroc explained in his autobiography, he learned an important lesson: "you could influence people with a smile and enthusiasm and sell them a sundae when what they'd come in for was a cup of coffee."

After his sophomore year, Kroc left high school to become a door-to-door salesman. A few months later, with the United States involved in World War I (1914-18), he lied about his age so he could become a Red Cross ambulance driver, but the war ended before Kroc could serve in Europe. At seventeen, Kroc returned to sales and picked up extra income playing the piano. After a series of jobs, Kroc married his first wife, Ethel Fleming, in 1922, and began selling paper cups. He also ran a Chicago radio station, then tried selling real estate in Fort Lauderdale, Florida.

By 1927, Kroc was back in Chicago selling paper cups, determined to make his career in sales. In 1938, Kroc started selling a new product, a machine that could mix five milkshakes at once. He formed his own company, Prince Castle Sales, and began traveling the country selling the "Multimixer." Kroc struggled for a few years, and World War II (1939-45) forced a halt in sales. After the war, Kroc's company thrived. In one of his best years, he sold eight thousand mixers.

Ray Kroc went to a school in Connecticut to learn how to drive ambulances. One of his classmates was another young Illinois teen who lied about his age to get in: Walt Disney (see Walt Disney Company entry). Years later, when Disney opened Disneyland in California, Kroc tried to convince him to put a McDonald's in the amusement park. The effort failed, perhaps one of Kroc's few failures with McDonald's.

The Birth of McDonald's

In 1954, Kroc heard about McDonald's, a California hamburger restaurant owned by Richard and Maurice McDonald. Kroc learned they had five Multimixers and ran them almost without stopping. Kroc could not believe a restaurant could sell so many milkshakes, so he went to see for himself. He quizzed the diners who filled the parking lot. They told him they enjoyed the inexpensive burgers and fries and often came to McDonald's. He also talked to the McDonald brothers, learning how they turned out food quickly so they could sell it cheaply. At one point, Kroc later wrote, "Visions of McDonald's restaurants dotting crossroads all over the country paraded through my brain." Each one, Kroc dreamed, would have five Multimixers, boosting his sales.

Kroc approached the brothers about expanding their chain nationwide. The McDonalds, however, resisted. They did not want the extra work it would take to launch such ambitious growth. Kroc said they could get someone else to run the chain for them. In his autobiography, Kroc recalled Richard McDonald's response: "'Who could we get to open them for us? " Kroc replied, "Well, what about me?" That conversation led to the birth of the McDonald's Corporation.

At the time, Kroc was fifty-two years old. His health had been poor in the past, and he suffered from diabetes and arthritis. His marriage was also shaky. (He and Ethel divorced in 1961, and Kroc remarried two more times.) But as Kroc wrote in his autobiography, "I was convinced that the best was ahead of me." After opening his first McDonald's in Des Plaines, Illinois, Kroc slowly added more restaurants. The McDonalds had created a system that gave each employee just one job, and the restaurant was planned to reduce their movements. Kroc followed this pattern in his restaurant. His goal was to have consistent quality, speed, and service at each McDonald's.

Ray Kroc and the McDonalds shared a desire for keeping their restaurants clean. If employees considered taking a break when business slowed, Kroc told them, "If you've got time to lean, you've got time to clean."

Key Business Practices

Kroc played a major role in spelling out certain procedures that guaranteed McDonald's success. He wanted the corporation to have control over its franchisees, the local business people who paid the corporation to run its restaurants. Other chains let franchisees buy the right to open as many stores in

Olympic skater Dorothy Hamill lends Ronald McDonald a hand in entertaining some young skaters at a fund-raising event for the Ronald McDonald House Charities. Reproduced by permission of AP/Wide World Photos.
Olympic skater Dorothy Hamill lends Ronald McDonald a hand in entertaining some young skaters at a fund-raising event for the Ronald McDonald House Charities.
Reproduced by permission of AP/Wide World Photos.
a region as they could. Kroc sold his franchisees just one store so he could make sure they knew how to run a McDonald's the way he wanted it run.

But even as Kroc wanted control, he also made sure his franchisees did well. Their success served his interests, since the corporation earned money on their restaurants' sales. Kroc did not sell them supplies at high prices, as other restaurant chains did. He also trained franchisees in the McDonald's methods at the company's Hamburger University. As John Love writes in McDonald's: Behind the Arches, "In the end, the genius of Ray Kroc was that he treated franchisees as equal partners."

Kroc's other major contribution to McDonald's was his salesmanship. As he had learned at his uncle's soda fountain, he could convince people they wanted what he had to sell. Kroc poured money into advertising, especially on television. Ronald McDonald, the company's new mascot, was introduced on TV in 1965. John Mariani, in his book America Eats Out, said that within six years, Ronald "was familiar to 96 percent of American children, far more than knew the name of the President of the United States."

Wealth and Charity

McDonald's became Kroc's company in 1961, when he gave the McDonald brothers $2.7 million for their share of the corporation. Four years later, he sold stock in the company. Over the years, Kroc's shares in McDonald's made him rich; he shared his wealth with others. He started the Kroc Foundation, which supported research on diabetes (which killed his daughter Marilyn in 1973), arthritis, and multiple sclerosis. On his seventieth birthday in 1972, Kroc gave $8 million to some of his top employees. Over the years, the corporation also donated food and money to many charities, and the company encouraged local franchisees to get involved in their communities. McDonald's best-known charitable effort is the Ronald McDonald Houses, homes near hospitals where families can stay for free while their children receive medical treatment.

In 1974, Kroc turned his attention from fast food to baseball, using his wealth to buy the San Diego Padres. A lifelong baseball fan, Kroc tried to turn around the struggling team. The Padres made the World Series for the first time in 1984, but Kroc did not live to see it. He died that January in San Diego at the age of eighty-one. After his death, his third wife, Joan, carried on his charitable work. She donated tens of millions of dollars to San Diego organizations, and in 1995 she gave $50 million to the Ronald McDonald Children's Charities, which had been founded in Kroc's honor.

The Man behind McNuggets

As he built his fast-food empire, Ray Kroc had important help from key employees. One of these people was Fred Turner. He worked the grills at the first McDonald's in Des Plaines, Illinois, training to open his own franchise. In 1957, he started working in Kroc's corporate office. He also helped start new restaurants, sometimes sweeping parking lots to make sure the franchises opened on time. Turner eventually became McDonald's chairman and chief executive officer (CEO), taking over for Kroc in 1977. Along the way, Turner helped introduce several new McDonald's products, such as Chicken McNuggets

For More Information

Books

Kroc, Ray, with Robert Anderson. Grinding It Out: The Making of McDonald's. Chicago: Henry Regnery Company, 1977.

Love, John F. McDonald's: Behind the Arches. Rev. ed. New York: Bantam

Books, 1995.

Schlosser, Eric. Fast Food Nation. Boston: Houghton Mifflin, 2001.

Vidal, John. McLibel: Burger Culture on Trial. New York: The New Press, 1997.

Periodicals

"McDonald's Vandal Sentenced to Prison." The Houston Chronicle (September 14, 2000): p. 22.

"McMissteps." Forbes (December 10, 2001): p. 76.

Pepin, Jacques. "Burger Meister." Time (December 7, 1998): p. 176.

Saporito, Bill. "Fallen Arches." Time June 9, 1997): p. 42.

Web Sites

McDonald's Corporation. [On-line] http://www.mcdonalds.com (accessed on August 16, 2002).

"McSpotlight." McInformation Network. [On-line] http://www.mcspotlight.org (accessed on August 16, 2002).



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Beth Neeley
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Sep 14, 2010 @ 4:16 pm
I would like to know what exactly influence Ray Kroc to be in the mcdonald's business. what did it do for him economically.

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