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Ray Kroc

"I believe in God, family, and McDonald's -- and in the office, that order is reversed."

"It is ridiculous to call this an industry. This is not. This is rat eat rat, dog eat dog. I'll kill 'em, and I'm going to kill 'em before they kill me. You're talking about the American way -- of survival of the fittest."

"If my competitor were drowning I'd stick a hose in his mouth and turn on the water."

Ray Kroc's business card was simplicity itself -- it bore just his name, the golden arches, and the word "Founder." But a more accurate title might have been "Usurper." Contrary to what the McDonald's marketing department tells you, Kroc wasn't the founder of anything. He just happened upon the scene at the right time and latched onto a proven winner.

Richard and Maurice McDonald had already established a thriving chain of eight burger joints in Southern California before Kroc even heard of them. In fact, Kroc merely signed on as their franchise agent. The McDonald brothers had been approached before -- most notably, by the Carnation Company -- with offers to handle their franchising, but they wanted to do it themselves. Ray succeeded where Carnation failed by ceaselessly nagging the brothers, until they finally relented.

Acting on their behalf, Ray sold McDonald's franchises around the country for 1.9% of the gross receipts. One of his first sales targets was Walt Disney, whom he had met in Connecticut during Red Cross ambulance driver training near the end of World War I. Ray sent him a letter in 1954 after hearing about Disneyland, which was still under construction:

Dear Walt,

I feel somewhat presumptuous addressing you in this way. Yet I am sure you would not want me to address you any other way... My name is Ray A. Kroc... I look over the Company A picture we had taken in Sound Beach, Conn. many times and recall a lot of pleasant memories.

I have very recently taken over the national franchise of the McDonald's system. I would like to inquiry if there may be an opportunity for a McDonald's in your Disneyland Development.

For whatever reason, he never got a reply. Undeterred, Ray Kroc crisscrossed America, planting McDonald's restaurants wherever he went. In a sense, then, Ray was the Johnny Appleseed of the fast-food industry. But if you happen to be one those cynics who reflexively hates everything about McDonald's, another less charitable way to express Kroc's function would be as the carcinogen which caused the chain to metastasize nationwide. Take your pick.

Either way, Kroc built an empire for Richard and Maurice McDonald, no question about that. And they, in turn, were more than happy to let to him do it. But after a while, Ray got pissed off at the brothers for their laissez-faire attitude toward the franchisees in California and Arizona, the only states excluded by Kroc's arrangement. As he wrote later in his autobiography Grinding It Out:

I get furious all over again just thinking about that California situation during the first five years we were in business. It was aggravation unlimited. In many ways it was a parallel to the frustrations I faced at home with my wife. The McDonald brothers were simply not on my wavelength at all. I was obsessed with the idea of making McDonald's the biggest and the best. They were content with what they had; they didn't want to be bothered with more risks and more demands. But there wasn't much I could do about it.

Not to mention the fact that the McDonald brothers had sold a franchise to somebody in Ray's backyard: Cook County, Illinois. For their part, maybe the brothers were pissed at him after he started claiming credit for everything. One of Ray's boasts wound up in print over and over again (even in his autobiography): "I put the hamburger on the assembly line."

Eventually the McDonald brothers decided they'd had enough grief and in 1961 agreed to sell their interest to the self-serving asshole. But there was a catch. During negotiations, Richard and Maurice changed their mind about giving up the first McDonald's outlet in San Bernardino, California. They decided to keep the store after all, as a sort of monument to the company's history. It would exist as a living reminder of the corporation's humble roots. Hell, it was the root. Predictably, this prospect drove Ray crazy:

I closed the door to my office and paced up and down the floor calling the [McDonald brothers] every kind of son of a bitch there was. I hated their guts.

For Kroc, this wasn't business; it was strictly personal. He confided to a friend: "I'm not normally a vindictive man, but this time I'm going to get those sons of bitches." When it came time to compile the autobiography, Ray rationalized:

What a goddam rotten trick! I needed the income from that store. There wasn't a better location in the entire state. I screamed like hell about it. But no way. They decided they wanted to keep it, and they were willing to pull the plug on the whole arrangement if they didn't get it.

He needed the income? What a pathetic excuse. But let's pretend for a second that it wasn't pure bullshit. How did Kroc respond to this serious financial crisis? As he proudly expressed it in his memoirs:

I opened a McDonald's across the street from that store, which they had renamed The Big M, and it ran them out of business.

Actually it was one block north, but the rest is true. Ray even presided over the store's grand opening. And its effect certainly was devastating. The Big M closed in 1964 -- just two years after the new McDonald's moved in.

Timeline

5 Oct 1902 Ray Arthur Kroc born in Oak Park, Illinois.
1906 Taken to a phrenologist by his father, Ray is told he's best suited to working in the food service industry.
1917 15-year-old Ray Kroc lies to the Red Cross about his age and almost becomes a World War I ambulance driver.
1922 Ray marries wife #1, Ethel Fleming.
1954 Ray Kroc cuts a deal with the McDonald brothers to sell restaurant franchises. In exchange, Kroc would receive 1.4% of each store's total sales.
2 Mar 1955 Ray Kroc founds "McDonald's Systems Inc." It is later renamed "McDonald's Corporation" in 1960.
15 Apr 1955 The first McDonald's franchise opens in Des Plaines, a suburb of Chicago. Because it is the first one launched by Ray Kroc, he names it "McDonald's #1" despite the fact that the McDonald brothers had already opened eight of their chain restaurants before they began accepting licensees. Kroc's unfortunate numbering system guarantees perpetual confusion for amateur fast food historians the world over.
1957 Ray notices Joan Smith playing piano in a St. Paul restaurant and is immediately "stunned by her blond beauty."
1961 Ray divorces Ethel after 39 years of marriage.
1961 Ray buys out the McDonald brothers for $2.7 million, but they keep the original restaurant at 1398 North E Street (14th and E) in San Bernardino, California. He puts his home up for mortgage and takes out so many loans that the original $2.7 million costs $14 million to pay back.
1962 Ray is personally on hand to open the newest McDonald's restaurant at 15th and E Street in San Bernardino, California.
Ray marries wife #2, Jane Dobbins Green (personal secretary to John Wayne).
8 Mar 1969 Ray gets divorced again and marries wife #3, Joan Smith.
1972 McDonald's CEO Ray Kroc secretly funnels $250,000 to President Richard M. Nixon in exchange for a 20% reduction in the minimum wage for teenagers.
There's one other mistake I made that I mention only because so many jackasses have brayed about it. That was my $250,000 donation to President Nixon's campaign in 1972. I let myself be talked into that by Nixon's fund raiser, Maurice Stans, and it wasn't until later that I realized I had made the contribution for the wrong reason. My motive was not so much pro-Nixon as it was anti-George McGovern. I should have known at the time that this went against my rule of not trying to make a positive out of a negative action. The worst thing about the donation was the subsequent implication by some sons of bitches that I made it in order to get favorable treatment from the federal price commission in regard to the price of our Quarter Pounder. As my friend and lawwyer, Fred Lane, says, "This has been thoroughly investigated by the Watergate Select Committee, the Government Accounting Office, the Department of Justices, and the House Committee on Impeachment, and none found any hint of impropriety." I use his language because my own is unprintable.
1974 Ray Kroc steps down as CEO; Fred L. Turner succeeds him.
9 Apr 1974 During the 8th inning of a home game against the Houston Astros, San Diego Padres owner Ray Kroc announces over the public address system: "Ladies and gentlemen, I suffer with you... I've never seen such stupid baseball playing in my life." Baseball commissioner Bowie Kuhn later forces Kroc to apologize to the fans.
1977 Kroc changes from Chairman to Senior Chairman of the McDonald's Corporation.
14 Jan 1984 Ray Kroc dies of heart failure in San Diego, California at age 81.
Oct 2003 Ray Kroc's widow, Joan, leaves National Public Radio over $200 million dollars in her will, including $5 million to her local NPR station, KPBS in San Diego.


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