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In return for their money and submission to headquarters, the licensees get to use the McDonald's real estate, name and formula. For most, that is close to a license to print money. The average outlet grossed $508,000 last year, earning its operator upwards of $70,000 before taxes. For that reason, McDonald's receives thousands of license applications a year and accepts only about 10% of them. The company gives preference to existing licensees, but values business or professional experience of any kind. Every year large numbers of executives, doctors and lawyers abandon their careers to take up the spatula. (They pretty much have to; Kroc demands that anyone putting up more than half the price of a McDonald's license work full time under the arches.)
Guy Rodrick, 48, practiced law in Chicago for two decades before he invested in a McDonald's outlet in 1967. "I became so fascinated with it that I began spending more time at McDonald's than with my law practice," he says. "Finally, my law partner suggested that I spend full time at one place or the other. I chose McDonald's and I have never regretted it." Four years ago, Rodrick moved to Florida and opened four outlets. Today he works seven days a week behind the counter and earns "a million dollars in happiness."
Lee Dunham, the Harlem licensee, was a New York City cop. He faced some problems that Hamburger U. did not prepare him for. Teen-age gangs tried to claim the store as their turf. "They would come in with their chains and start rapping them on the counter," says Dunham. One day Dunham pulled out the .38 revolver that he is licensed to carry and told the gang leaders: "The moment you come in here, you belong to me." Then he bought the leaders hamburgers, talked about black image with them, and gave some of them jobs. Today, Dunham's store grosses $110,000 a month, more than twice the national average, and his all-black staff of 120 keeps the place immaculate. "I tell them, 'Let's do better than the Man downtown,' " he says. "Any time you say 'beat Whitey,' they work harder."
Young employees at McDonald's are not munificently rewarded. Most make little more than the minimum wage of $ 1.60 an hour. The Nixon Administration last spring proposed raising the hourly minimum to $2.20 in 1975 but partially exempting students who work part time, a category that covers most of the McDonald's work force. Washington skeptics, who note that Kroc openly gave $250,000 to the Nixon campaign last year, dubbed the measure "the McDonald's bill." Congress accepted the special student provision but Nixon last week vetoed the minimum wage bill as inflationary.
Happy Home. Many of the youths exhibit surprising dedication. Pilferage runs only about $30 per month per outlet, a percentage of sales far below the average for all retailing. Wade Litchenberg, 18, a night manager in Fort Lauderdale, describes his job as "a real challenge. I love it—meeting people, learning all about the business." Says Lynnette Myers, 18, of Jackson, Miss.: "It's a happy place to work. It's my home away from home."