On Fast Food Nation

I recently finished reading Fast Food Nation – The Dark Side of the All-American Meal by Eric Schlosser.

The purpose of this book, about the fast food industry, is best summarized by the author within the introduction: “I do not mean to suggest that fast food is solely responsible for every social problem now haunting the United States. In some cases (such as the malling and sprawling of the West) the fast food industry has been a catalyst and a symptom of larger economic trends. In other cases (such as the rise of franchising and the spread of obesity) fast food has played a more central role. By tracing the diverse influences of fast food I hope to shed light not only on the workings of an important industry, but also on a distinctively American way of viewing the world.”

This book recounts the history behind the uprising of fast food to become a dominant force in our modern society. However, what most of us do not know is : “what lies behind the shiny, happy surface of every fast food transaction”. Eric goes on to investigate every aspect of the fast food industry: people, cattle, vegetables, health etc. The storytelling techniques that he uses throughout the book bring this expose to life. The stories are descriptive, personal and touching.

A very educative and enlightening read, and a rude (much needed) awakening about the food industry in general and the fast food industry in particular.

Below are key excerpts from the book that I found particularly insightful:

“The history of the twentieth century was dominated by the struggle against totalitarian systems of state power. The twenty-first will no doubt be marked by a struggle to curtail excessive corporate power. The great challenge now facing countries throughout the world is how to find a proper balance between the efficiency and the amorality of the market.”

“Today’s fast food industry is the culmination of those larger social and economic trends. The low price of a fast food hamburger does not reflect its real cost – and should. the profits of the fast food chains have been made possible by losses imposed on the rest of society. The annual cost of obesity alone is now twice as large as the fast food industry’s total revenues.”

“The right pressure applied to the fast food industry in the right way could produce change faster than any act of Congress. The United Students Against Sweatshops and other activist groups have brought widespread attention to the child labor, low wages, and hazardous working conditions in Asian factories that make sneakers for Nike.”

“Nobody in the United States is forced to buy fast food. The first steps toward meaningful change is by far the easiest: stop buying it. The executives who run the fast food industry are not bad men. They are businessmen. They will sell free-range, organic, grass-fed hamburgers if you demand it. They will sell whatever sells at a profit. The usefulness of the market, its effectiveness as a tool, cuts both ways.”

“Whatever replaces the fast food industry should be regional, diverse, authentic, unpredictable, sustainable, profitable – and humble. It should know its limits. People can be fed without being fattened or deceived. This new century may bring an impatience with conformity, a refusal to be kept in the dark, less greed, more compassion, less speed, more common sense, a sense of humor about bran essences and loyalties, a view of food as more than just fuel. Things don’t have to be the way they are. Despite all evidence to the contrary, I remain optimistic.”

 

Regards,

Omar Halabieh

Fast Food Nation

On McDonald’s – Behind The Arches

I recently finished reading McDonald’s – Behind The Arches by John F. Love.

As best summarized on the back cover of the book – “McDonald’s is the story of an American business success, a company that proved the value of hard work, ingenuity, trial and error, and gut instincts. In McDonald’s: Behind the Arches, business writer John F. Love tells the astonishing story of the people, and the strategies, the innovation and the brilliance that turned a single hamburger stand into a multibillion-dollar corporation that has influenced the very culture of America – and now the world.”

An exceptional business read, with countless lessons in business, management, leadership and sourcing. These lessons are inter-weaved within a great story about the start and growth of one of the most recognizable brands in the world. A must read!

Below are excerpts from the book that I found particularly insightful:

1- “Few outside McDonald’s understand that Ray Kroc’s brilliance is found in the way he selected and motivated his managers, his franchisees, and his suppliers. He had a knack for bringing out the best in people who worked with him. To be sure, Kroc’s success with McDonald’s is a story of his own entrepreneurship. But it is more. He succeeded on a grand scale because he had the wisdom and the courage to rely on hundreds of other entrepreneurs.”

2- “The fundamental secret to McDonald’s success is the way it achieves uniformity and allegiance to an operating regimen without sacrificing the strengths of American individualism and diversity. McDonald’s manages to mix conformity with creativity.”

3- “Essentially, the approach Kroc took in franchising was the same as he took in selling food service supplies: his success was based on finding a way to make his customers successful with his product. As simple as it sounds, it was a revolutionary idea in the rapidly expanding food franchising business, and Kroc’s notion of a fair and balanced franchise partnership is without question his greatest legacy.”

4- “In short, Kroc assembled and tolerated one of the most diverse collections of individuals ever to occupy the top management of an american corporation. And even today, the practice of recruiting extremely individual managers is a McDonald;s trademark, one almost completely hidden by the chain’s legendary operational uniformity.”

5- “In fact, McDonald’s greatest impact on American business is in the areas that consumers do not see. In their search for improvements, McDonald’s operations specialist moved back down the food and equipment supply changed…They changed the way farmers grow potatoes…they altered the way ranchers raised beef…Indeed, no one has had more impact than McDonald’s in modernizing food processing and distribution in the past four decades.”

6- “McDonald’s also encouraged closeness with vendors by giving them enormous incentives to upgrade their operations. It did so by demonstrating early on that it could be just as loyal to suppliers that met its standards as it was tough on those that did not.”

7- “What converted McDonald’s into a money machines had nothing to do with Ray Kroc or the McDonald brothers…Rather, McDonald’s made its money on real estate and on a little-known formula developed by Harry J. Sonneborn.”

8- “The free exchange of Zien’s promotional ideas set a precedent that remains a key principle in McDonald’s marketing today: that all franchisees are partners, and what one develops to improve his or her local operation is provided freely to all operators to improve the system’s performance, with no royalty going to the franchisee, who discovered the concept.”

9- “…for most of its history, dedication to new products resided with certain product-oriented franchisees who stubbornly pushed their inventions on company managers who were not easily sold on them.”

10- “He (Kroc) had built not a company but a system of independent companies all pursuing the same goal, each dependent on the other. Indeed, the synergy that was developing between all the parts of McDonald’s was so different and unexpected that Kroc himself was only beginning to grasp the significance of it.”

11- “The packaged foods companies belatedly discovered that there was an enormous difference between the management of manufactured foods sold to grocers and foods prepared and sold directly to customers at a fast-food outlet. In the former, manufacturing is centralized and more easily controlled, and the sale to the consumer is indirect and depends highly on branded advertising. In the latter, production is decentralized and difficult to control, since each store is a self-sustaining production unit. Furthermore, the sale to the consumer is direct and depends highly on local service.”

12- “But McDonald’s reliance on nearly captive suppliers for technological breakthroughs goes beyond new products. Indeed, it was suppliers – driven by the prospect of increased McDonald’s business – who played the key role in organizing McDonald’s supply lines and making its distribution system one of the most advanced in all of retailing.”

13- “…McDonald’s Americanization of the global food service industry is one of the most promising developments in U.S. trade relations. McDonald’s, after all, is exporting what has become the centerpiece of American industry – the service sector.”

14- “More important, however, Fujita’s success made it clear to McDonald’s that to succeed in retailing abroad it needed a partnership that could give McDonald’s a home grown flavor in each foreign market without deviating from the fundamentals that made McDonald’s work in the United States.”

15- “The company was not only a good target for environmental activists because it was large, but the fact that it had outlets in virtually every U.S. community of any size made McDonald’s accessible to picketers and protesters everywhere, in some cases for issues that the company was not remotely involved in.”

Regards,

Omar Halabieh

McDonald’s – Behind The Arches