McDonald’s in British

The UK is the largest European market for fast-food, probably because the market is more developed than in other European countries. McDonald's first British unit opened in Woolwich, London, in 1974. Its growth from the first restaurant was dramatic. At the end of 1999, it had over 1,000 outlets in the UK, of which 302 were run by franchisees. McDonald's employed over 48,000 people; a further 16,500 worked in its franchises. The total sales from both its company owned restaurants and its franchised outlets reached £400 million and it catered for 2.5 million people a day.

By the end of the twentieth century, McDonald's logo was no longer confined to the high streets but extended to leisure centres and retail parks as well as airports and cross-Channel ferries. McDonald's has gone beyond this by opening its own motorway service station called McDonald's Services which it opened on the M5 in Devon in 1999. In February 2001 McDonald's bought a 33 per cent stake in Prêt à Manger. McDonald's dominates the chained fast-food sector both in terms of company and brand terms, taking a share, by value, of 52 per cent n 1999. Together McDonald's and Burger King had 73 per cent of the market in 1999.

In a busy world where one does not even have time to change out of his work clothes to spend “quality” time with his or her daughter, McDonald's is there to help. The food is necessary to have the fun and companionship, but what the food consists of is irrelevant. Love (1995) points out that as McDonald's started to expand in the late 1960s it realized that to cultivate a national mass market, it needed to develop a media campaign that focused on the family rather than the product and price.

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When McDonald's returned to their complete American menu, altered their buildings to be more similar to their American architecture, and modified their ad campaigns to “food, folks, and fun,” - the myths of hard work and leisure, Americana and American culture and consensus - did their work. In Britain the McDonald's ads proclaimed,  “The United Tastes of America.” In the UK, adverts were aimed in the middle of the biggest market, the family segment. If children wanted to have fun at McDonald's, their parents would take them, and they would be McDonald's customers for life.

From my perspective, the McDonald's success is based upon its ability to tell a story, a story that does not make sense from a logical perspective but rather from an aesthetic one. The story has coherence and fidelity and helps one solve his or her problem through the purchase and possession of commodities. McDonald's is successful not through the components of a rational system that includes efficiency, calculability, predictability, and control, but through its advertising campaign that hails each of us to come in and buy its product of “food, folks, and fun,” to come in and fulfil our American dream.

Although most Americans would not consider McDonald's to make the “best” hamburger in their home towns, McDonald's is hugely successful on an international basis. One does not go to McDonald's expecting the best hamburger in town. One goes to McDonald's expecting the image. McDonald's success is due to their creation of a narrative that is not necessarily true but rather provides us with a sense of personal identity, a sense of community life, a basis for conduct, and explanations of that which cannot be known.

Labour shortages encourage fast-food employers to alter their work systems in ways that minimize the demand for labour through reorganization or technological change. Subway Sandwiches supplies franchisees with pre-portioned sandwich ingredients from centralized food preparation plants; McDonald's has experimented with robotic french fry makers, automated touch-screen ordering machines, and automatic electronic payment systems for cashless drive-through service. McDonald's also expects its new “Made for You” food preparation system to reduce employee turnover and provide some labour savings.

Before the imposition of the minimum wage McDonald's employees worked in the regions under 18 started on £3.25 per hour and those over 18 started on £3.50 per hour. In the UK McDonald's has three separate pay 'scales' for inner London, outer London and the provinces and it has both under-18 and over-18 starting rates. In fact McDonald's increased its UK pay rates again by a flat rate of 10 pence on 28 March 1999 to bring the over-18 starting rate to £3.60 outside London. Something like 70 per cent of McDonald's UK employees are under 21, and approximately 30 per cent are under 18.

In October 1999 McDonald's was the last of the leading fast-food chains to remove the youth rate for under 18s. In 2000 McDonald's increased its minimum rate outside London to £3.75, once again probably in response to the small increase in the minimum wage for that year of £3.70. Figures from IDS (2001) suggest that McDonald's does not pay the lowest wages in the sector: it actually appears somewhere in the middle compared with other companies. However, its dominance in the market place undoubtedly has a constraining effect on wages amongst its competitors. The evidence at the McLibel trial also confirms this. Vidal (1997:312) states that the judge commented that: “the British McDonald's operation pays low wages and it depresses wages for other workers in the industry.”

Of course McDonald's has been increasingly involved in the acquisition of other companies in recent years. In the UK the purchase of the Aroma coffee chain and more recently Prêt à Manger may signal a new corporate strategy. In any case the relatively small number of restaurants in Europe compared with that in the US suggests that the European market is likely to experience a lot more expansion in future, although McDonald's is already the market leader in the UK.

The UK McDonald's is, as in many other countries, expanding rapidly and becoming an increasingly important feature of modern employment. Although the majority of outlets in the sector are independent operations, it is the chain operations often owned by large multinationals which are the most profitable and which are driving growth. It is a highly competitive industry and labour costs are a large percentage of the overall costs of the business. It is hardly surprising therefore that there is likely to be a continual and persistent downward pressure on wages and conditions in this sector.

Bibliography

IDS. 2001, “The national minimum wage in pubs and restaurants”, Incomes Data Services, March: 1-8.

Love J. F. 1995, McDonald’s: Behind the arches. New York: Bantam.

Vidal, J. 1997, McLibel: Burger Culture on Trial, London: Macmillan.

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