Did ray kroc steal mcdonald's

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Date: ________________________________

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“The Founder” Assignment

Runtime: 1 hr. 50 mins.

The Founder features the true story of how Ray Kroc (played by Michael Keaton), a struggling salesman from Illinois, met Mac and Dick McDonald, who were running a burger operation in 1950s Southern California. Kroc was impressed by the brothers’ speedy system of making the food and saw franchise potential. The movie details how Kroc maneuvered himself into a position to be able to pull the company from the brothers and create a billion-dollar empire.

Directions: Obtain a copy or stream the 2016 move “The Founder” starring Michael Keaton. Answer the following questions as you view the movie. Type your responses in the lines indicated in bold blue. Upload this Word document to the “The Founder” assignment section in iLearn. Grading will be on the basis of 70% correctness of responses and 30% quality of English and communication.

1) At the start of the movie we meet Ray Kroc (Michael Keaton) who is a struggling traveling salesman for Prince Castle Sales. The year is 1954. The movie is opening with him delivering a sales pitch directly to the camera. What is Kroc selling that nobody wants?

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2) While traveling around, trying to sell his product, what does Kroc observe about the many fast food/drive-in restaurants that he stops at?

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3) When Kroc calls June, who is the secretary of the sales division of the company he works for, Prince Castle Sales, he finds out an order has been placed for six milkshake mixers from a restaurant drive-in out in California. He thinks this is an error so he calls the restaurant which he finds out is McDonald’s. He talks to Dick, one of the owners and finds out it was a mistake. How many do they really want?

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4) The ordering of so many milkshake mixer machines by McDonald’s piques Kroc’s curiosity and he makes a drive to San Bernardino to see the restaurant in person. What does Kroc find out about this restaurant that is so different than the other fast-food/drive-ins he has been to? What does he observe/experience?

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5) Kroc introduced himself to one of the owners—Mac McDonald and tells him he has some operation and that he was the one who sold him the milkshake mixer. Mac tells him he can give him a tour and Kroc happily agrees. Kroc gets a behind-the-scenes look at how McDonald’s operates. What are they doing that makes them so much better than their competition?

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6) After the initial kitchen tour, Kroc wants to take the McDonalds brothers out to dinner because he says he is impressed with how the restaurant runs and that it is so remarkable. Wanting to hear their story/the history of McDonald’s, he takes them out to dinner. Answer the following questions:

a) When the restaurant first opened, they were selling multiple items and sales were down. They also realized a drive-in restaurant had a host of problems like attracting teenagers, slow service, etc. They also realized that most of their profits came from hamburgers, fries, and milkshakes. With this realization, what did they decide to do?

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b) What was the purpose of the drawings out on the tennis court?

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7) Kroc tells the McDonalds brothers he wants to franchise the restaurant. The brothers tell him they already tried and are against it—they already have five restaurants set up—four around California and one in Phoenix, Arizona. They say that is all there will ever be. Why are they against franchising?

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8) Kroc makes note of a picture on the wall in the brothers’ office. It is of a McDonald’s with two golden arches on either side of the building. Who came up with the concept/design?

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9) True or False. Circle one. Kroc’s wife, Ethel, is skeptical of his idea to franchise McDonalds.

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10) Fill in the blank. Kroc insists that the brothers let him start franchising/lead their franchising efforts and says that he will start by opening one in his town- Des Plaines, Illinois so that he can monitor it. They finally agree and he signs a _______________. It allows the brothers control of every decision made since the franchise stores will be representing them. All changes need to receive the brothers’ approval in writing.

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11) Kroc goes from bank to bank to try to get a loan to start his franchise but they all remember him from his other pitches over the years and won’t give him a loan. Finally, a banker is open to loaning him start-up funds but tells him he has to put up what for leverage/collateral?

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12) As construction begins at Kroc’s first franchise in Des Plaines, Illinois (where he lives), Kroc tries to make some changes but contractually he can’t unless the brothers will approve it. What big company wanted to be a sponsor for McDonald’s in exchange for having their name on the menu? Note: The McDonalds brothers said no.

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13) True or False. Circle one. Kroc’s first McDonald’s franchise opens in Des Plaines, Illinois. Kroc micromanages it to make sure everyone on staff is following proper protocol.

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14) At his country club, Kroc entices his wealthy friends to invest/open a McDonald’s franchise. He tells them they just need to pay the franchise fee and he’ll take care of everything else. They aren’t responsible for anything. They can just share in the profits. In the next scene we see the McDonalds brothers talking about how many franchises Kroc has now opened in the last month. Answer the following:

a) How many has he opened?

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b) What is Dick McDonald worried about concerning all these new franchises Kroc has popping up all over the place?

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15) What does Kroc unfortunately encounter when he visits these new franchises that were owned by the country club men?

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16) What were the country club men’s’ reaction to Kroc when he went to the golf course to yell at them about their neglected restaurants?

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17) Kroc realizes that rich men aren’t good franchisee owners because they don’t care enough. When he stops by his sales company he comes across a gentleman selling a bible to June and when he questions him why he is selling them he says he just wants to make a living. Kroc then gets the idea that working class can get enough money together to buy a franchise and will take good care of it. He has this gentleman and other blue-collar workers buy a franchise. What is this gentleman’s (Leonard) restaurant like?

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18) At the Prince Castle Sales Office, June tells Kroc he is almost out of capital. Kroc is not making enough money off the franchises because by contract he only gets 1.4% of the profits. This is not covering his expenses and he is not breaking even. Kroc wants to renegotiate his contract with the McDonalds brothers. He calls the brothers to renegotiate. Will the brothers renegotiate the contract?

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19) At home, Ethel tells Kroc that a man called from Illinois First Federal Bank and she is upset that he mortgaged their home/put it up as collateral. How many months behind are they on payments?

20) Kroc has dinner with one of his franchisees, Rollie Smith and his wife June. They share an idea with him on how they can save hundreds of dollars in electrical costs and reduce time in making milkshakes. They say that the walk-in refrigerator and ice cream is costing them a fortune. Answer the following:

a) What is the solution?

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b) What is Kroc’s response?

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c) What happens when he calls the McDonalds brothers to pitch the idea of the milkshake mix to save costs? Do they agree?

21) While at the bank dealing with his overdue mortgage, a financial consultant for Tastee-Freez named Harry Sonneborn, requests to review Kroc’s books and gives him a solution to his money problems.

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True or False. Circle one. Harry tells Kroc he should be in the real estate business. That land is where the money is. He says he should buy land where the restaurants want to set up and make it mandatory for franchise owners to lease from him. He can then control the operation because if they don’t keep the restaurant up to quality, he can cancel their lease.

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ELIMINATE QUESTION #22 BELOW; DO NOT ANSWER:

23) The McDonalds brothers complain to Kroc when they find out that franchises are receiving shipments of the Inst-a-mix milkshakes packets when they said by contract he could not make that change.

Fill in the blanks. Kroc tells Mac that contracts are like Write your response here and they’re meant to Write your response here .

24) At dinner one night, Kroc abruptly tells his wife Ethel that he wants a divorce. He meets with his lawyer and tells him she can have the house, the car, etc. but that she cannot have what?

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25) The McDonalds brothers call Kroc when they realize he has now named his company The McDonalds Corporation. They threaten to sue him. What does Kroc tell them that sends Mac into a diabetic shock?

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26) Ray flies to California to meet with the McDonalds brothers and gives them a blank check. He wants to buy the company. The brothers talk it over and realize they will never beat him in court. What do the brothers ask for?

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27) The deal to buy the company is made in person but Kroc’s lawyers say the one percent earnings will have to be carried out by a what? It cannot be put into the contract.

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28) After the brothers receive their checks, Kroc runs into Dick in the bathroom and Dick asks him why he didn’t just run off and steal their ideas after he got a tour of the restaurant. Kroc says the restaurant would have failed and tells him he does not realize what made their restaurant so successful. What does he say made them so successful?

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29) Due to the terms of their agreement/contract with Kroc, the brothers are forced to change the name of their original hamburger stand because it infringes on the intellectual property of Kroc. What do they change the name to?

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30) Kroc opens up a new McDonalds across the street from the brother’s restaurant. When a reporter asks to do a story on his 100th location opening, Kroc gives him his business card listing him as what?

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31) What is the one-word Kroc contributing to making him go from an over the hill milkshake mixer salesman to building a fast-food empire with 1600 restaurants in 50 states and 5 foreign markets with a revenue around $700 million?

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32) Name three interesting facts we learn at the end of the movie.

After you write your response here you’re DONE! Now upload this Word doc to iLearn.