Ray Kroc Net Worth at Death/today
By the time of Kroc’s death in 1984, the McDonald’s chain had grown significantly, with 7,500 outlets in the United States and 31 other countries and territories.
In 1983, the total system-wide sales of McDonald’s restaurants reached over $8 billion, and Kroc’s personal fortune was estimated to be around $600 million.
Ray Kroc Bio
Raymond Albert Kroc was a successful American businessman who is best known for his role in the growth and expansion of McDonald’s.
Kroc was born on October 5, 1902 and spent much of his career working in the food and restaurant industry. In 1961, he made the decision to purchase McDonald’s, a small fast-food chain that was founded by the McDonald brothers.
Kroc served as the CEO of McDonald’s from 1967 to 1973, during which time he oversaw the expansion of the company into a global fast-food corporation. Due to the significant growth of McDonald’s under Kroc’s leadership, he is often referred to as the founder of the McDonald’s Corporation.
After retiring from McDonald’s, Kroc went on to own the San Diego Padres, a Major League Baseball team, from 1974 until his death on January 14, 1984.
Ray Kroc Parents and Early Life
Raymond Albert Kroc was born on October 5, 1902, in Oak Park, Illinois, a suburb of Chicago. His parents, Rose Mary and Alois Kroc, were both of Czech descent and had immigrated to the United States.
Alois Kroc had made a fortune speculating on land in the 1920s but unfortunately lost everything during the stock market crash of 1929.
Kroc’s early life was marked by several significant events, including World War I and the Great Depression. When he was just 15 years old, he lied about his age and joined the Red Cross as an ambulance driver, where he served alongside Walt Disney.
After the war ended, Kroc struggled to make a living and worked a variety of jobs, including selling paper cups, working as a real estate agent in Florida, and playing the piano in bands.
Despite these challenges, Kroc remained determined and eventually found success in the food and restaurant industry.
Ray Kroc Purchasing McDonalds
After World War II, Raymond Kroc began working as a salesperson for Prince Castle, a food service equipment manufacturer.
Kroc was responsible for selling milkshake mixers, but the company struggled with competition from lower-priced products offered by Hamilton Beach. In 1954, Kroc visited a McDonald’s restaurant in San Bernardino, California, which had purchased eight of his milkshake mixers.
Kroc was impressed by the efficiency and success of the restaurant and struck a franchise agreement with the owners, Richard and Maurice McDonald.
After finalizing the franchise agreement, Kroc reached out to Walt Disney, with whom he had served as an ambulance attendant trainee during World War I.
Kroc sent a letter inquiring about the possibility of opening a McDonald’s restaurant at Disney’s amusement park. According to one account, Disney agreed to the proposal but stipulated that the price of fries be increased from ten cents to fifteen cents, allowing him to profit from the arrangement.
Kroc, however, refused to raise prices for his loyal customers and the deal fell through. Some have questioned the accuracy of this account, with writer Eric Schlosser speculating that it may have been a doctored retelling by McDonald’s marketing executives. It is likely that the proposal was simply returned without approval.
Raymond Kroc made a number of significant changes to the food-service franchise model during his tenure at McDonald’s. One of the most notable changes was his decision to only sell single-store franchises, rather than the larger, territorial franchises that were common in the industry at the time.
Kroc believed that this approach would allow him to retain some control over the direction and development of the McDonald’s chain, as well as ensure uniformity in service and quality at all locations.
In order to achieve this goal, Kroc implemented strict policies for McDonald’s restaurants, including a focus on cleanliness, customer service, and standardized food preparation and presentation.
Kroc also made the decision to only establish McDonald’s locations in suburban areas, as he believed that downtown and urban areas posed a higher risk of break-ins and other security issues.
In addition to maintaining high standards of cleanliness and customer service, Kroc also insisted on strict guidelines for food preparation and presentation and prohibited any deviation from the prescribed specifications.
Kroc was also known for his commitment to reducing waste and maximizing efficiency and required that every condiment container be scraped clean to prevent waste. He also banned cigarette machines and pinball games from all McDonald’s restaurants.
During the 1960s, several fast food chains emerged that followed the successful business model of McDonald’s, including Burger King, Burger Chef, Arby’s, KFC, and Hardee’s.
Raymond Kroc, the CEO of McDonald’s, became frustrated with the McDonald brothers’ desire to keep the chain small and their refusal to allow him to make changes to the business, such as altering the original blueprint. Despite Kroc’s efforts, the brothers never agreed to these changes in writing.
In 1961, Kroc decided to purchase the company for $2.7 million, with the goal of ensuring that each brother received $1 million after taxes. Obtaining the necessary funds for the buyout was challenging due to existing debt from expansion, but Kroc was eventually able to secure the required capital with the help of Harry Sonneborn, whom he referred to as his “financial wizard”.
At the closing of the deal, Kroc became annoyed when the McDonald brothers refused to transfer the real estate and rights to the original San Bernardino location to him.
Instead, the brothers decided to give the operation, property, and all, to the founding employees. In response, Kroc opened a new McDonald’s restaurant near the original location, which had been renamed “The Big M” because the brothers had not retained the rights to the name. “The Big M” closed six years later.
There are allegations that as part of the buyout of McDonald’s in 1961, Raymond Kroc promised, based on a handshake agreement, to continue the annual 1% royalty of the original agreement with the McDonald brothers.
However, there is no evidence to support this claim beyond the assertion of a nephew of the brothers. Both of the McDonald brothers refrained from expressing any disappointment about the deal, and Richard McDonald reportedly stated that he had no regrets about the buyout.
Raymond Kroc maintained the efficient “Speedee Service System” for hamburger preparation, which was introduced by the McDonald brothers in 1948, in all McDonald’s locations.
He ensured that every burger would taste the same in every restaurant by standardizing operations, including setting strict rules for franchisees on how the food was to be made, portion sizes, cooking methods and times, and packaging.
Kroc also refused to cut costs by using soybean filler in the hamburger patties and held high standards for customer service, including refunding money to customers whose orders were incorrect or who had to wait more than five minutes for their food.
Raymond Kroc Wife
Raymond Kroc had three marriages in his lifetime. His first marriage was to Ethel Fleming, whom he met in 1919 and married in 1922.
They moved to Chicago, Illinois together and welcomed their daughter Marilyn in 1924. However, their marriage ended in divorce.
Kroc’s second marriage was to Jane Dobbins Green, which also ended in divorce. His third wife, Joan Kroc, was a philanthropist who increased her charitable donations after Kroc’s death.
She supported a variety of causes, including the promotion of peace and nuclear nonproliferation. Upon her death in 2003, she left a $2.7 billion estate that was distributed among several nonprofit organizations, including a $1.5 billion donation to The Salvation Army to build 26 Kroc Centers and a $200 million donation to National Public Radio.
In addition to these contributions, she also donated to community centers serving underserved neighborhoods throughout the United States.
Raymond Kroc Cause of Death
Raymond Kroc, the founder and former CEO of McDonald’s, suffered a stroke in 1980 and received treatment at an alcohol rehabilitation facility.
Despite this, he eventually passed away from heart failure at a hospital in San Diego, California on January 14, 1984, at the age of 81.
He was then buried at the El Camino Memorial Park in Sorrento Valley, San Diego. Kroc is remembered as a key figure in the success of McDonald’s and the global expansion of the fast food chain.