Walmart and Macdonald's in Franchising

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