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The spread of fast food outlets around Great Britain- the early years. Michael Waterson* Department of Economics, University of Warwick (drawing on work with Otto Toivanen and assisted by Jo Sault) Part-funded by ESRC *Speaking in a personal capacity. In the beginning …. Prior to 1974

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The spread of fast food outlets around great britain the early years l.jpg

The spread of fast food outlets around Great Britain- the early years

Michael Waterson*

Department of Economics, University of Warwick

(drawing on work with Otto Toivanen and assisted by Jo Sault)

Part-funded by ESRC

*Speaking in a personal capacity


In the beginning l.jpg
In the beginning … early years

Prior to 1974

  • There was fish and chips

  • There was Wimpy

  • And then in 1974 came McDonalds

  • An innovation, compared to what had gone before:

    • Opening hours

    • Speed/ service style

    • Consistency of product and service

    • Very successful



Slide4 l.jpg

Gross turnover £m early years

Turnover- Coverage McDonalds

900

800

700

600

500

400

300

200

100

0

0

5000

10000

15000

20000

Expenditure coverage, £m

Note that as coverage increased, “ available share” remained essentially constant


How did they manage this l.jpg

Total number of districts early years

with a McDonalds (total districts ~450)

300

250

200

150

District numbers

100

50

0

1970

1975

1980

1985

1990

1995

Year

How did they manage this?

  • Combination of broadening and deepening of the chain

    • Extending gradually across areas

    • Moving first to areas near London

    • Infilling in existing areas

    • See map


Slide7 l.jpg

This pattern is repeated by several other chains of similar activities, besides McD- e.g. Wetherspoons

Really, the puzzle is why it took so long to spread to the further regions- things seem to be swifter now


Some potential answers significance of mcd l.jpg
Some potential answers- significance of McD activities, besides

  • Chainstores, really a 20th Century phenomenon

    • McD is a prime example

    • Of course the chain has developed further since 1990, but has faced more competition, essentially on its own until then

  • Falling per-store opening costs

    • Learning by doing

  • Professionalization of the outlet planning process

    • Consultancies on outlet planning

    • Burger King learning from McDonalds, example

  • Growing homogenisation of tastes, reduced regionalism?

  • Other chains have done it