Origin of the Fast Food Industry
Such food is usually made with precooked or preheated ingredients, prepared in bulk and sold in packages for takeaway or quick eating at the restaurant. This type of business has been around in various forms for most of human civilization. As far back as ancient Rome and Greece, taverns and inns served food to people who had a reason to be away from home. This trend has continued and evolved over time and set a framework for the contemporary fast food industry. This report presents an overview of the history and evolution of the fast food industry and its impact on entrepreneurship in the sector. As such, eating out, which had initially been considered a luxury, became a common occurrence which evolved to be a necessity (Mennell et al.
Consequently, many working families in America needed inexpensive food and quick services for both lunch and dinner. This need among the American people created business opportunities for many enterprising individuals that set up restaurants across America. The high demand for the cheap food and quick services fueled the phenomenal success of the early fast food giants. McDonald’s is recognized as the largest and most successful fast food company in the world. Despite the change in America’s view, the fast food industry did not experience significant growth until the automobile started gaining popularity in the country (Spurlock, 2006). As people became more mobile and frequently traveled, they developed a need for quick food on the go. Despite the accelerated growth of the fast food industry with the increased popularity of the automobile, it was not until the 1940s that the assembly-line system of food preparation was used in the industry when the original McDonald’s was started by the McDonald brothers (Paeratakul et al.
The assembly line made it efficient to produce a limited number of food items with an emphasis on quality. The efficiency of the assembly line in the fast food sector attracted many investors that wanted to venture into the sector. Major Innovations in the Fast Food Industry over Time McDonald’s has certainly survived multiple drastic changes in the fast food industry and has shown resilience to survive and remain a leading fast-food company for decades. The company has always been adaptive to changes in the market and processes in the industry. As such, over, the decades, McDonald’s has been at the forefront of major innovations in the fast food industry. Given the dynamic and ever-changing tastes and preferences of the American population, McDonald’s has constantly changed its offerings and transformed its services to provide the greatest value to its customers.
This customer-focused culture of the company has been instrumental in establishing customer loyalty and increasing the market share (Love & Miller, 1986). Furthermore, in those years, more women were increasingly venturing into careers and had no time to prepare food at home. Due to these factors, Domino’s Pizza made overwhelming profits from food delivery innovations. Other companies such as McDonald’s then followed the trend and incorporated the home delivery into their services. This innovation had the effect of adding value through efficiency and convenience. Another example of such innovations is outsourcing order taking. The first period of change occurred in the 1950s and the early 1960s to usher in the eating out culture. During this period, the environment experienced changes such as increases in population, increased traveling sparked by automobile popularity, shorter workweek among employees, increased number of suburban restaurants, working patterns which favored eating out, increasing demand for take-home food, and families developing a habit of budgeting for eating out.
These changes in the environment made the fast food industry a crucial sector in the economy. Many fast food chains were established during this period to respond to the changing environment. Another phase of environmental change occurred between the 1960s and the late 1980s when the fast food market started inclining towards the diet food. The changes in the environment between the early 1990s to present were characterized by the advent of the cell phone, computers, and the Internet. These changes in the environment caused increases in take-out ordering using cell phones, computers, and over the Internet. These changes in the environment are also associated with the market’s increased interest in niche markets such as sushi, yogurt, and cupcakes. In addition, the cell phones, computers, and the internet enhanced consumer consciousness on health, which influenced the practices and processes of the fast food chains.
How the Environmental Changes Affected Opportunities for Entrepreneurs and the Skills Required to Succeed The environmental changes affected entrepreneurship in the fast food industry in different ways. The characteristics of entrepreneurs who benefited from the changes in environment between the 1960s and 1980s are perseverance, flexibility, and risk tolerance. The changes between the early 1990s to present presented opportunities for entrepreneurs in the fast food industry to enhance the efficiency and effectiveness of processes. As customers could place orders using cell phones or computers, the effectiveness of services tremendously enhanced and restaurants could process more orders within a short time. Entrepreneurs that benefitted those changes had characteristics of versatility, decisiveness, and flexibility. Cost Structure in the Fast Food Industry Companies in the fast food industry need to set their Cost Structures from the start.
Price out menu B. Labor Cost i. Valet ii. Security iii. Salaried employees iv. Home delivery enabled the fast food restaurants to exponentially grow their revenue since they were able to serve a significantly increased number of customers. Outsourcing order taking transformed the sector by improving speed, service, and accuracy. The technology freed up restaurant employees from taking orders. Hence, they focused their energy on processing orders, accepting payment and addressing other needs. The periods between the 1960s and the 1980s experienced less entrepreneurial start-ups than other periods because of the discovery of health awareness by customers at the time. Cornell University Press. Cook, I. , & Crang, P. The world on a plate: culinary culture, displacement, and geographical knowledge. Journal of material culture, 1(2), 131-153.
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