McDonald’s in Norway Team 4 Matthew Byler Robert Jameson Charlotte Jorgensen Becky Tibbenham I n t e r n a t i o n a l M a n a g e m e n t D e c e m b e r 7 , 2 0 1 0 Table of Contents
McDonald’s General Background ................................................................................................... 2 McDonald’s in Norway: Background.............................................................................................. 4 McDonald’s in Norway: Franchises ................................................................................................ 5 McDonald’s in Norway: Suppliers .................................................................................................. 6 McDonald’s in Norway: Employee Demographics......................................................................... 7 McDonald’s in Norway: Employee Training .................................................................................. 7 McDonald’s in Norway: Employee Wages and Benefits ................................................................ 9 McDonald’s in Norway: The Menu............................................................................................... 10 McDonald’s in Norway: The Customer Experience...................................................................... 12 McDonald’s in Norway: Environmentally Friendly ...................................................................... 13 McDonald’s in Norway: Competitors ........................................................................................... 14 McDonald’s in Norway: Problems ................................................................................................ 14 McDonald’s in Norway: Managing ............................................................................................... 15 1 McDonald’s General Background McDonald’s is the world’s leading fast food restaurant, “with more than 32,000 local
restaurants serving more than 60 million people in 117 countries each day.”1 They are the
undisputed leaders when it comes to sales, given that they earn approximately $22 billion per year
and the next closest competitor is Subway at $9 billion per year. (A comparison of McDonald’s
size to their competitors can be found in Appendix A.) They are also the largest employer among
fast food restaurants, with more than 465,000 full-time employees (and 1.5 million overall)
worldwide.2
The majority of McDonald’s stores are franchises. More than 75% of McDonald’s
restaurants worldwide are currently owned and operated by franchisees.3 Their franchises are
fairly expensive compared to similar establishments, both with upfront costs and ongoing royalty
fees. (A comparison can be found in Appendix B.) However, even though they are expensive,
there are still approximately 24,000 franchises worldwide.
McDonald’s actually began in the 1940s by Richard and Maurice McDonald, brothers
who lived in San Bernardino, California. In 1948 they created the “Speedee Service System,”
which established the principles of the modern fast food restaurant. 4 The brothers changed their
restaurant from a carhop to the modern day self-service, drive-in restaurant.5 Though the
McDonald brothers created the concept of McDonald’s, Ray Kroc was the businessman who
turned McDonald’s into a successful worldwide franchising fast food operation. Kroc was an
aggressive businessman who saw McDonald’s potential for success. Because the McDonald
brothers only wanted to maintain a minimum amount of stores, Kroc purchased the entire
company from them for $2.7 million.6 A general timeline of McDonald’s rapid progress can be
found below: 7
2 •
1955 First franchise (but ninth store overall) purchased by Ray Kroc in Des
Plaines, Illinois.
•
1958 Sold its 100 millionth hamburger
•
1959 Opened their 100th restaurant
•
1961 Kroc purchased company; Trademarked the name “McDonald’s” and the
double arch symbol
•
1962 First restaurant with inside seating was opened
•
1963 500th restaurant was opened
•
1965 Public stock offering ($22.50 per share)
•
1967 Goes international to Canada and Puerto Rico
•
1968 Big Mac introduced; Modern golden arch symbol created
•
1974 First Ronald McDonald House opened
•
1978 5,000th restaurant opened
McDonald’s has truly become the symbolization of globalization and the American way
of life. They are currently in 119 countries (61% of the world) and serve more than 58 million
customers each day, and their brand was valued at approximately $66.58 billion in 2009.8
McDonald’s has surpassed Coca Cola as the world’s most famous brand, thus showing the
immense recognition of their brand.9 They have also created McCafe, which offers high quality
coffee in more than 1,300 locations, and has increased their brand visibility.10 Thus, McDonald’s
is seen prominently throughout the world, often seen as emulating the American way of life,
especially given that they are sometimes the only American brand present in a particular area.
One reason for McDonald’s success is their emphasis on Quality, Service, Cleanliness,
and Value (QSC&V). This is a benchmark used throughout the world to assess the standard of its
3 restaurants (both wholly-owned and franchised restaurants). There are multiple tools used to
assess these areas, which is compiled and then given a letter grade. Stores that do not meet the
standard have their rent significantly increased by corporate so that it is cost prohibitive for them
to continue operating. 11 It is through this method that McDonald’s ensures consistency among its
worldwide stores, which in turn allows customers to have their expectations met when visiting
stores worldwide.
McDonald’s in Norway: Background
Norway was the 31st country that McDonald’s entered, and received their first store in
1983. McDonald’s had already entered the Netherlands, Germany, France, Sweden, the United
Kingdom, Switzerland, Ireland, Austria, Belgium, Spain, and Denmark, so the company was
familiar with European operations.12
Norway has grown immensely over the last 27 years, and they currently have 69 stores
with a total annual revenue of more than one billion kroner (approximately $167 million US).13
Their stores stretch from Kristiansand to Steinkjer,14 and the majority of stores are in urban
populations. Norwegian stores have a mixture of traditional and unique architecture for its
restaurants. For example, the McDonalds in Kristiansand is built in a bank,15 the one in Drammen
is built in the old stock exchange building,16 and the store in Bergen is built in a home-looking
building.17 The interior is relatively similar, though some of the McDonald’s are seen as
significantly more sophisticated and upscale than what is typically thought of in the United States.
Though Norwegian McDonald’s are now very similar to the United States’ McDonald’s,
Kjerstin Bratelien Larsen, a current McDonald’s corporate employee in Norway says:
Since McDonald’s started in Norway in 1983 a lot of things have changed. In the
beginning the menu was very limited, with only 4-5 burgers to choose [from]. In
4 the mean time there have been a lot of tryouts on the menu with different
campaigns. But today the menu almost looks the same as it did when they first
started. The prices have increased as a consequence of that the prices of the raw
material has increased. McDonald’s Norway only uses Norwegian raw materials.18
Thus, McDonald’s has evolved over the past twenty-seven years to become more similar to the
worldwide McDonald’s brand.
McDonald’s in Norway also exhibits the corporate QSC&V values, as well as promising
the same basic menu (hamburgers, French fries, etc.). Employees are also trained at Hamburger
Universities, similar to other employees worldwide. This ensures that the operations procedures,
service, quality and cleanliness (QSC&V values) are consistent, while also providing training and
leadership development for managers.19 (Additional information under the training section.) Thus,
though Norway follows the same quality standards as other McDonald’s worldwide, there is still
an ability to customize the purchasing, menu, and local impact because of franchising.
McDonald’s in Norway: Franchises
Norway, like much of McDonald’s worldwide, focused on franchising. Currently, 85% of
Norwegian McDonald’s are franchises, and they believe that franchising is a key reason for their
success.20 This is because owners are able to both influence their work while also gaining the
experience, network, and operations expertise that comes with being a part of the McDonald’s
network. Being locally-owned is also typically better for the environment as they are concerned
with their immediately surroundings. Additionally, the franchising system allows for a local
customization of the menu, which allows them to meet their customers’ tastes and needs despite
the global expansion. Norway’s McDonald’s also focuses on being local with their food supply.
They typically purchase from local suppliers, though they must be approved, high quality food (as
per the government).21
5 McDonald’s in Norway also has slightly different goals and costs than other McDonald’s
franchises. According to Kjerstin, Norway McDonald’s goal is to have a fewer number of
franchises, but to have them larger in size.22 Additionally, they have found that it is most
profitable for franchisees to run three or more restaurant. Though McDonald’s is usually more
expensive than many of its competitors in franchising fees (as previously mentioned), many
franchisees in Norway are able to make changes to their contracts. Kjerstin mentioned that each
owner makes a direct agreement with McDonald’s regarding the rent paid to the company
depending on the size of the restaurant, varying between 5-25% of the sale. The franchisees also
have the option to buy the store right away or to sign a three-year rental agreement with
McDonald’s.
McDonald’s in Norway: Suppliers
McDonald’s in Norway uses only one supplier, HAVI Logistics, which is headquartered
in Oslo. Kjerstin said this is the only approved distributor for McDonald’s, and McDonald’s is
HAVI Logistic’s only customer in Norway. Because McDonald’s is their only customer, they
wield significant influence over HAVI Logistic’s decisions.23 HAVI’s website mentions that they
are an “international logistics network of 25 Food Service Logistics (FSL) companies and an
additional 15 service enterprises.”24 They essentially take care of everything for McDonald’s,
including the transporting and storage of all food items. However, though all food suppliers go
through this one company, decisions regarding other service suppliers (such as cleaning) are left
up to the discretion of the franchisee.
6 McDonald’s in Norway: Employee Demographics
Norway currently has more than 2,000 employees in their 69 stores.25 Their employees
come from more than 70 countries, partially due to their McPassport Scheme.26 This is a system
that allows workers to transfer between stores within the twenty-nine member countries (Austria,
Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Norway,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, and the UK) as long
as there is an opening, which gives the benefit of maintaining your work history (and status), and
cutting down paperwork. The only criterion are that the employee knows English, have a basic
level of the new country’s language, fill out a few details for your current manager, look for
vacancies, and then get the new manager’s approval. For Norway, this is a huge benefit given
their limited population size.
To work at McDonald’s one must be at least sixteen years old. They are currently one of
the biggest employers for youth, and the majority of their employees are between 16-25 years old
and are working part-time while attending school.27 Employees are evidently satisfied with their
work arrangements because McDonald’s was voted as the fourth best workplace in Norway
among large companies in 2008,28 and was voted 36th (out of 1,250 companies) across all of
Europe during the same year.29
McDonald’s in Norway: Employee Training
For new McDonald’s employees, the main form of training is learning on-the-job. They
divide the training into small “stations” where new employees learn tasks one by one, until all of
the “stations” have been learned.30 McDonald’s also has a comprehensive training and leadership
7 development program for developing managers. This is divided into theoretical and practical
learning, so that managers can have a comprehensive set of skills. This training program pairs the
potential manager with a supervisor, has the employee prepare an individual development plan,
and then has frequent follow-up conversations with the manager. Throughout the program, the
employee will participate in several leadership courses that are aimed at developing leadership,
communication, and technical skills. In particular, the courses cover leadership, communication,
interpersonal skills, scheduling, creating a respectful workplace, equipment maintenance,
recruiting, team building, conflict management, business planning, security, local marketing, and
healthy and safety. These leadership courses are held in Oslo’s national training center, which
allows potential managers to meet other candidates from across Norway. They are also given the
opportunity to participate in other leadership courses that take place in Sweden, London or
Chicago (though it depends on the position and course).31
Another avenue for manager training is through Hamburger University. The same
program is taught worldwide, in 22 United States regional training facilities, and seven campuses
worldwide (Sydney, Munich, London, Tokyo, Hong Kong, Brazil, and the newly built facility in
Shanghai).32 As previously mentioned, managers go to Hamburger University to learn how to
own and operate McDonald’s restaurants, particularly focusing on how to maintain the QSC&V
values. This ensures that all products, kitchen layouts, and procedures are strictly controlled and
essentially the same worldwide.
McDonald’s provides these avenues of training so as to increase the possibility of internal
promotions for their employees. These educational opportunities prepare people for the
challenges that will come with increased responsibility, which occurs frequently given that
advancement up the career ladder is fairly easy. McDonald’s currently incorporates a five-level
8 career ladder: Restaurant Staff (crew); Assistant Shift Leader; Shift Leader; Assistant Restaurant
Manager; Restaurant Manager. By participating in the training courses, employees will qualify to
move up to the next rung on the career ladder. The possibility of promotion is one of the reasons
McDonald’s has such as high employee satisfaction rate in Norway.
McDonald’s in Norway: Employee Wages and Benefits
Norway’s pay scale for McDonald’s employees is significantly higher than what is paid in
America. In the interview, Kjerstin mentioned that the employees’ wages were controlled by the
Norwegian tariff agreement, which bases wages on age. Thus, McDonald’s currently pays the
following rates, with differentials added to this based on working evening or weekends and
seniority:33
Ages 16-17
Ages 18-20
Ages 21+
88.68 to 98.68 Kroner/hour
113.68 to 134.99 Kroner/hour
134.99 Kroner/hour starting
$14.63 to $16.28
$18.76 to $22.76
$22.76+
Thus, the absolute lowest starting wage is still double the starting American wage of $7.25 per
hour. McDonald’s typically employs people ages 16 to 25, and the average monthly salary for all
Norwegians in this category is 25,218 NOK34 ($4,214), or the equivalent of working 186 to 284
hours per month at McDonald’s wages. Thus, though their wage is high compared to other
countries’ McDonald’s salaries, it is still lower when compared to other Norwegian positions for
similar ages. In fact, Norway actually has the highest average salary worldwide, so in order to
attract and retain employees they need to pay a wage above McDonalds’ usual worldwide
average.35
It should also be mentioned that McDonald’s pays wages similar to others in the industry
and that they follow the Norwegian Working Environment Act, which relates to protecting
9 workers. Specifically it regulates the physical and organizational working environment, including
regulations on leaves of absence, protection against discrimination, working time and overtime,
and regulations regarding employment and dismissals.36 The intent of the Act was less about job
security and more about the working conditions since Norwegians generally feel they have a
strong job security.37
Because Norway’s government provides more general benefits for its residents (in
comparison to the United States), the benefits provided by McDonald’s vary from what is
provided in the United States. Kjerstin said that every McDonald’s employee in Norway has a
pension agreement and insurance. Other benefits like bonuses, gift cards, or gym memberships
may then be provided, but it is dependent upon each franchisee’s choice.
McDonald’s in Norway: The Menu
Since McDonald’s is built on a system of franchises, restaurant operators are allowed a
certain degree of flexibility in the menu. One thing that is unique is the food source.
Approximately 80% of the food served in McDonald’s restaurants comes from Norwegian
producers.38 Given the Norwegians’’ focus on environmentally friendly products (which will be
discussed more in-depth later), using locally grown items is an important attribute.
In regards to specific menu items, one of the most unique additions to the Norwegian
menu is the Lakse (fish) wrap that is sold only in Norway and Finland (see Appendix C for
photos). They previously served another fish sandwich, the salmon McLaks.39 Norway also offers
carrots and fruit as side item choices alongside the traditional french fries and salads.40
10 Another interesting menu novelty in Norway is that they are gluten free.4142 Though many
Americans would like these gluten free buns to be available in the United States, at the present
time these are only offered in the country of Norway.
Aside from these unusual items, the majority of food is similar to what is served across the
globe. Kjerstin said:
There is one menu that is supposed to be available in every country in the world. [But]
each country has to look at who their customers are and choose a selection based on this.
For instance, in some countries they have fried snails in addition to fries. In Norway,
[there is] a big focus on a health menu, with salads, yoghurt, fruit, carrots, salmon wrap…
but this is not that profitable. The customers go there to buy a burger.43
Thus, McDonald’s still offer items like the regular Cheeseburger, Big Mac, Quarter Pounder, Big
& Tasty, salads, Diet Coke, french fries, and Happy Meals. Though the items are similar, the
prices are not. For example, if someone purchase a Filet O’Fish, Big Mac, Cheeseburger, two
large French Fries, Smoothie, and a Diet Coke it would be approximately $32 in Norway, but
approximately $16 in the United States. In fact, as of 2008, Norway had the most expensive Big
Mac in the world, costing about $7.20.44 Though this price is significantly higher than the $3.57
paid for in the United States it is still the most popular item in Norway’s McDonald’s.45 Thus, the
items might be similar but the prices vary considerably.
Even though many of the menu items are similar, there is a difference in the portion sizes.
Kjerstin said, “The portions are much smaller in Norway than [in the] USA. A little portion in the
USA is a big portion in Norway. The burgers are the same size, but when it comes to the fries and
soda it is a huge difference.”46 Additionally, there are no refills offered for sodas in Norwegian
McDonald’s.
11 McDonald’s in Norway: The Customer Experience
The Norwegian McDonald’s experience would be comparable to the American
experience, but it varies considerably from a normal Norwegian restaurant. As previously
mentioned, many of the menu items are similar between Norway and America. Additionally,
there have a kid friendly atmosphere, having playgrounds, toys in the Happy Meals, and
comprehensive birthday packages. Many McDonald’s also have McDrives available for drive thru
service. Since drive thrus are uncommon in Norway, this system would feel similar to the
American experience, but be unique for Norwegians. Norway’s McDonald’s also differ in that
they do not offer breakfast items and they have a greater focus on being environmentally friendly.
One thing that the McDonald’s in Norway has been doing during the past year is
redecorating their stores. Kjerstin mentioned that the stores are becoming more modern and
customer-friendly, and that they are making the restaurants look the same so that they are easier
for the customer to recognize.
The Norwegian perspective of McDonald’s is mixed. Kjerstin said that people’s
perceptions of McDonald’s and their general reputation are varied. There are many myths about
the company, which is something McDonald’s is trying to correct, which has generally been
successful. McDonald’s has also cooperated with young farmers in Norway, which has allowed
them to have a better reputation.
Norwegian dietary habits do affect McDonald’s sales and experience. Norwegians
traditionally eat more proper meals rather than fast food.47 However, because of the demanding
everyday lifestyle and the increase in working homes, fast food products have become more
popular.48 Additionally, they tend to have larger breakfasts than average, which often include
bread, meat, fruits, vegetables, and juice or coffee. People often take a packed lunch to work
12 because of the shorter lunch breaks (though this means they may leave earlier in the afternoon).49
These factors, along with their healthier eating habits, have influenced the way McDonald’s
markets itself to the population. There is a familiarity of the worldwide brand, but the marketing
has become more upscale and sophisticated, while healthier food options have been included (as
previously mentioned). It should also be noted that McDonald’s is unable to advertise during
children’s programming, so the marketing campaign might have switched focus from children to
adults because of this law.50 Regardless, the current marketing strategy is more upscale than see
elsewhere.
McDonald’s in Norway: Environmentally Friendly
Norway is a very environmentally friendly country. Last year, the Research Council of
Norway chose eight national research centers to research environmentally friendly technology
like wind, solar, and bioenergy; CO2 capture and storage; and zero-energy housing. Each center
will be given 20 million NOK ($3.34 million) per year for five years.51 The government is
encouraging this innovation so as to develop good technology while also increasing Norwegian
expertise in this area, and they hope that in the long-term this will create new industrial activity
and jobs.
Beyond the government’s involvement, McDonald’s has made a commitment to being
environmentally friendly. They have many initiatives in place to conserve and recycle items.52 For
example, McDonald’s gets 75% of their raw materials and 80% of their food from within
Norway. They also carefully plan their shipments so that the trucks are not returning empty, thus
reducing fuel consumption. They also conserve water within their stores and use low impact
detergents so as not to harm the environment. McDonald’s also uses and promotes alternative
13 fuels, with 56-68% of restaurants using the fat to produce biodiesel. They also seek to lower their
energy consumption through heating the stores with energy-saving systems. McDonald’s uses
80% recycled packaging, and then recycle their cardboard, paperboard, foil packaging, and bottles
recycled. Beyond their store and company operations, they also partner with community groups to
minimize litter, such as through participating in the Keep Norway Clean campaign.
McDonald’s in Norway: Competitors
Americans often think of McDonald’s competitors as being fast food chains like Burger
King, KFC, Wendy’s, and Subway. However, Norway does not have many of these restaurants,
so Burger King is their only big fast food restaurant competitor. Kjerstin also mentioned that gas
stations like 7-Eleven are considered competitors. However, McDonald’s competitive advantage
is their drive-thru capabilities since they are the only existing drive-thru restaurants in Norway.
This is particularly shown in their sales, since nearly 50% of their sales come from the drive-thru.
McDonald’s in Norway: Problems
The most glaring problem that has occurred in Norway was the media frenzy over the
McAfrika burger in 2002. It was inspired by the flavors of Africa, but was introduced into the
market during one of the greatest periods of starvation on the African continent. McDonald’s’
Norwegian spokeswoman Margaret Brusletto told the BBC that “We understand the criticism and
it was never our intention to offend anybody. We do agree to a certain extent that this was bad
timing.”53 Though they did not stop the advertising campaign, they did allow the Norwegian
Church Aid organization to profile their work in fighting hunger against southern Africa, and they
eventually donated a portion of their profits to African aid organizations.
14 McDonald’s also faced issues when initially entering Norway, particularly with the
unions. There was an agreement from the 1930s and 1940s that related to the hospitality industry,
and the Norwegian Hotel and Restaurant Workers Union (HRAF) attempted to:
Establish a company-level collective agreement for every franchise operation and for
those employed in the McDonald’s company-owned restaurants. The idea behind this
approach was to make sure that workers would know their rights and take ‘ownership’ of
the collective agreement. However, the unions [were] not very successful; franchisees in
particular have been unwilling to negotiate company-level agreements.54
Though the Norwegian union tried to organize the employees under their umbrella, they were
ultimately unsuccessful when McDonald’s entered, primarily because of the high level of
turnover and the young workforce that was anti-union. However, in 1993 the HRAF was
successful and McDonald’s agreed to sign the collective agreement for the Norwegian sector,
though it only included the wholly owned stores, not the franchises (since they are considered
independent owners).55
McDonald’s in Norway: Managing
If one manages a McDonalds in Norway, he or she should expect to have the same
egalitarian approach that is so prevalent within their culture. Norwegians work hard to keep their
company structure appear very flat, meaning that although the manager would be in charge of the
employees, the manager should act more like a coach than a typical dominant boss as in the
United States. The Norwegian culture also accepts many of the views of Jante Law, which means
the manager is not smarter or better than his employees or colleagues. As a manager at
McDonalds, one needs to be both a coach and an encourager to ensure that the best comes out of
the employees, and to run the most effective and profitable business possible.
15 The value of this egalitarian approach is that the McDonalds’ employees feel actively
engaged and valued in the business, thus they have more invested. Furthermore, in 1999,
McDonalds’ starting wage in Norway was £7.32 ($11.52) when the national average wage in
Norway was £8.50 ($13.38). During the same year in the United States, the average McDonalds’
starting wage was £3.23 ($5.09) whereas the national average wage was £8.79 ($13.84).56 The
Norwegian McDonalds’ employees were the highest paid in the European Nation, which could be
due to the fact that many of the McDonalds’ employees are part of the Norwegian Hotel and
Restaurant Union. When one combines feeling valued with getting paid a decent wage, the
employees tend to be happier and more productive. McDonalds’ workers in Norway undoubtedly
have the best working conditions with the highest pay, both of which are the result of the
Norwegian culture’s effect on management style.
McDonalds’ international strategy typically involves hiring local people to manage the
restaurants.57 The reason for hiring local managers is to help lower the initial costs of entering the
country, as well as to break down the culture and language barriers. However, they do take into
consideration the laws and policies of Norway, which is why many of Norway’s McDonalds’
employees are part of a union. Although the management culture in Norway is very Norwegian,
all McDonald’s have the same policies and procedures worldwide in order to maintain
consistency (QSC&V). McDonalds’s flexible international strategy has allowed them to be
successful in Norway since their lower level employees and management can come together and
create products, which has been crucial to their success in Norway.
To sum it all up, in order to be a successful manager in Norway, one must have an
egalitarian outlook to management and leading so as to be thought of by one’s employees as
another coworker that leads and coaches (while at the same time still following McDonalds’s
16 standard policies and procedures). A successful Norwegian manager at McDonalds will have very
little distance between him/herself and their employees, and will actively engage them throughout
the decision making process. Managers make their employees feel valued. Since this egalitarian
outlook is prevalent among all McDonalds’ employees in Norway, this approach will allow the
restaurant to run smoothly and efficiently.
17 Appendix A
Competitor Comparison
# Stores
# Employees
# Countries
Revenue
Burger King12
12,150
41,000
76
$2.54 billion
KFC34
15,000
24,000
109
See note*
McDonald’s56
32,000
465,000
117
$22.6 billion
Pizza Hut78
12,685
30,000
92
See note*
Subway910
33,733
(not given)
92
$9.03 billion
* Yum! Brands does not distinguish the revenues from its various brands. Across all brands
(KFC, Pizza Hut, Taco Bell, Long John Silver’s, etc.) they earned $11 billion.
1 http://www.bk.com/en/us/company-­‐info/franchise/index.html 2 http://en.wikipedia.org/wiki/Burger_King 3 http://www.kfc.com/about/ 4 http://en.wikipedia.org/wiki/KFC 5 http://en.wikipedia.org/wiki/McDonald's 6 http://money.cnn.com/magazines/fortune/global500/2007/snapshots/2262.html 7 http://en.wikipedia.org/wiki/Pizza_Hut 8 http://www.wikinvest.com/stock/Yum!_Brands_(YUM) 9 http://www.subway.com/subwayroot/index.aspx 10 http://en.wikipedia.org/wiki/Subway_(restaurant) 18 Appendix B
Franchise Comparison
Franchise
Fee
Burger
King111213
$50,000
KFC1415
$25.000
Start-up Cost
$300,000 –
$2.8 million
$1.2 million $1.8 million
16
McDonald’s
$45,000
$1.06 million
- $1.88
million
Pizza Hut1718
$25,000
$317,000 $3 million
$15,000
$78,600 $238,000
Subway
1920
Basic
Royalty
Advertising
Royalty
Net Worth
Requirements
4.5%
4.0%
$1.5 million
4.0% or
$600/month
5.0%
$1.5 million
12.5%
Included,
but 4.9%
service fee
No minimum,
but requires
$500,000
liquidity
6.5%
None
$1 million
3.5%
$30 - 90,000
but requires
$80- 310,000
liquidity
8%
11 http://www.burgerkingfranchiser.com/burger-­‐king-­‐franchise-­‐fees.html 12 http://franchises.about.com/od/fastfoo1/fr/burger-­‐king.htm 13 http://www.worldfranchising.com/franchises/Burger-­‐King-­‐Corporation.html 14 http://www.thefranchisemall.com/franchises/details/10004-­‐0-­‐KFC.htm 15 http://www.worldfranchising.com/franchises/Kfc.html 16 http://www.allbusiness.com/franchises/mcdonalds/11598501-­‐1.html 17 http://franchises.about.com/od/pizza/fr/pizza-­‐hut.htm 18 http://www.thefranchisemall.com/franchises/details/11149-­‐0-­‐Pizza_Hut.htm 19 http://www.thefranchisemall.com/franchises/details/10257-­‐0-­‐Subway.htm 20 http://www.entrepreneur.com/franchises/subway/282839-­‐0.html 19 Appendix C
Photos: Norway’s unique menu items
Lakse (fish) Wrap:
McLaks Sandwich (Salmon):
20 END NOTES
1
“Our Company – Getting to Know Us” McDonalds - United States. Nov 22. 2010. Web.
<http://www.aboutmcdonalds.com/mcd/our_company.html>
2
“FAQs” McDonalds - Canada. Nov 23. 2010. Web.
<http://www.mcdonalds.ca/en/aboutus/faq.aspx>
3
“Our Company – Getting to Know Us” McDonalds - United States. Nov 22. 2010. Web.
<http://www.aboutmcdonalds.com/mcd/our_company.html>
4
“McDonalds” Wikipedia, 15 Nov. 2010. Web. <http://en.wikipedia.org/wiki/McDonald's>
5
“McDonald’s is Founded” McDonalds - United States. Nov 22. 2010. Web.
<http://www.aboutmcdonalds.com/mcd/our_company/mcd_history.html>
6
Business Stories of All Time: Ray Kroc; John Wiley & Sons; 1996.
7
“McDonald’s is Founded” McDonalds - United States. Nov 22. 2010. Web.
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8
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