George Cohon loves a challenge. Whether it’s opening the very first McDonald’s in eastern Canada in 1968 and founding McDonald’s Restaurants of Canada, launching Ronald McDonald House Charities Canada or taking McDonald’s to Russia, Cohon is an industry pioneer, charting new courses and changing the foodservice landscape along the way. In fact, the effusive entrepreneur has built a legacy of firsts through an illustrious career that spans almost 50 years. At the heart of his success is his unfailing belief that “None of us is as good as all of us,” a philosophy he learned directly from Ray Kroc, the man who made McDonald’s a household name around the world.
Interestingly, it was Kroc who urged Cohon to buy the rights to McDonald’s in eastern Canada. At the time, Cohon was a corporate lawyer in Chicago representing a client who wanted to buy the rights to McDonald’s in Hawaii. When the deal fell through, and the client wasn’t interested in buying the rights to eastern Canada instead, Kroc pressed Cohon to join the McDonald’s team. “Ray Kroc sensed I didn’t like law, and he was right. He said ‘George why don’t you give up law, and work for us; you’ve got what it takes.’”
Little did Kroc know just how prophetic those words would prove to be. Packing up his belongings, Cohon and his wife Susan, along with their two sons Craig and Mark, made the trek north, arriving in Canada to face one of his biggest challenges. “We didn’t know a soul, we didn’t have much money and McDonald’s then was far from being the household word it is today,” he recalls in his best-selling autobiography To Russia with Fries.
In fact, when Cohon and his team went shopping for companies to supply its products, they found a less-than-welcoming reception. Companies such as J.M. Schneider Inc., Silverwood Dairy and Sobey’s turned him down flat. “People didn’t know who we were,” he explains. Today, the company spends more than $1 billion on food and materials, with $887 million of that sourced in Canada.
Similarly, “when we opened the first restaurant in London, Ont. we wanted to give money to a local charity so we called the Crippled Children’s Treatment Centre because we wanted to give them a portion of our proceeds from our first-day’s sales. They said, ‘we’ve never heard of McDonald’s’ … They made me go to a Board of Directors’ meeting and explain what the company was to justify taking money from us.”
Fast forward to 2015, and McDonald’s is the country’s leading burger chain by sales volume, boasting 2014 sales of $3.8 billion based on a total of 1,440 stores from coast to coast and employing more than 85,000 Canadians.
Though the company started as a licensee of the American behemoth, it was the Chicago-born Cohon who recognized the importance of approaching business here in a distinctly Canadian fashion. “My thought process was always we’re a separate country; we’re not part of the United States. Let’s build McDonald’s in Canada as a Canadian company; let’s get Canadian suppliers, hire Canadian people,” he recalls. “As a matter of fact, we’re probably the only one that is allowed to have the Maple Leaf in the middle of the M,” boasts the 78-year old Cohon, who became a Canadian citizen in 1975. “I was always conscious that we’re different; our tastes are different. People might like vinegar here; they never use it in the U.S.; there are all kinds of different things.”
One of the constants in the company’s success is the almost zealous focus on its founding principles: Quality, Service, Cleanliness & Value (QSC & V). “You’ve got to serve quality food, you’ve got to do it in very clean surroundings, have great service and at a price people can afford,” affirms Cohon. “That doesn’t change over the decades. It’s modified in different ways with different menu offerings but those principles are basic. They are with us from day one and they’ll be with us in the future, too.”
Of course, in the early days, McDonald’s success was built on three core products — burgers, fries and soda, but along the way, the company has been forced to change. “It’s really important,” states Cohon. “QSC & V is a constant, but the physical plant, the quality of the food is constantly upgraded, the drive-thru, which accounts for a great portion of our business, and is now sometimes tandem — those things have to be brought up to date all the time.”
The company was one of the first burger chains to diversify its menu — introducing salads and a host of other menu items, reducing sodium in many of its offerings and providing nutrition information for all its menu offerings. And, recently, in a bold move to become more customer focused, the company now allows customers “to order from a self-serve kiosk. You can create your own sandwich, with your own condiments. You then sit down and it’s brought to you. You have to be at the forefront,” says Cohon. It’s all about being responsive to consumer demand. “We exist because of our customers. We have to be aware of what customers want, and make changes out of those needs and expectations.”
Along the way, it’s also set many industry standards and firsts, fuelling other chains to follow the leader. For example, early in its history, the chain demanded that its suppliers conduct thousands of safety and quality-inspection checks on its food before delivering to its restaurants — beef and chicken go through more than 70 additional safety checks every day. The company has also imposed rigorous safety protocols through every step of the Happy Meal toy design.
When it comes to staffing, McDonald’s values its young workforce, providing them with an introduction into the work world and a springboard to future success. “John Betts, who is now our CEO, started as a crew person in 1970 in Southampton, New York. If you look at the owner community across the country, probably 60 per cent or more started as crew and ended up being owner/operators,” boasts Cohon. The company has been named to Aon Hewitt’s Best Employers in Canada’s ranking for the past 12 years, placing in the top 10 in 2013.
At the core of what McDonald’s is about, even in those early days when they couldn’t give away money to a charity, is the importance of giving back — a concept Cohon learned from his Ukranian parents. The idea for Ronald McDonald House germinated in the U.S., but Cohon successfully imported it to Canada in 1981, making it the first house outside the U.S. Today, there are 14 Houses across the country. “Since the first house opened, there have been a total of 269,916 children and their families served. The numbers are awesome. In 2015, we’ll be helping over 25,000 families,” he says.
These days, with more time on his hands, Cohon has been spending a great deal of it at the Toronto house, among the largest in the world with 90 bedrooms. “We’ve got two golden retriever dogs that serve as therapy dogs. Though the numbers are staggering, the dogs allow me to see that it’s all about helping one family at a time. It’s [about] a boy that was waiting for a heart transplant who was there for five months, it’s a child who’s having chemotherapy for a brain tumour … and is really beat up after the chemo but loves playing with the dogs.”
The company donates 10 cents from every Happy Meal sold in Canada to support the construction and operation of Ronald McDonald Houses. Cohon is also proud of the company’s McHappy Day initiative, which started in Canada. “We’ve raised tens of millions of dollars. What I like about that is it’s gone around the world.”
Three years ago, the company introduced the Ronald McDonald Care-Mobile, a state-of-the-art vehicle that delivers free medical, dental and health-education services to under-served children. Two units are currently being piloted in Calgary. Now, with the creation of mini McDonald’s Family Rooms in hospitals, parents are only steps away from their child’s bedside. “There are 13 of them across the country. It’s rewarding to see what the team has done to build that,” says Cohon, adding that another 10 are being planned.
Beyond those efforts, Cohon is also credited with saving Toronto’s Santa Claus Parade from extinction, stepping up when the Eaton family could no longer afford to run it. “It’s good for the community; it’s 110 years old. It’s really unbelievable that even with the great depression, and World War II, the parade never stopped one time.”
Cohon was also instrumental in expanding the McDonald’s brand outside Canada. A chance encounter with the Soviet delegation at the 1976 Montreal Olympics fuelled an idea with Cohon to expand into the former U.S.S.R. McDonald’s opened its first restaurant in Russia in 1990, paving the way for international expansion in destinations never imagined, but also sparking an interest in global expansion from other chains.
He admits it wasn’t easy. “I waded in at the height of the Cold War; I started in 1976, it took us 14 years to get the first restaurant opened. The biggest obstacle was we were free enterprise, they were communists. Wading through that maze of bureaucracy, and — if you think it was a hard to explain what McDonald’s was in Canada in the early days — it was nearly impossible to explain in the Soviet Union. But I liked the people. I found them engaging. They had the same values, when you got into their psyche a bit … they ate meat, bread, potatoes and milk. We serve the highest quality of that, they’re going to love us here,” he thought.
Twenty-five years later, with 519 units and 40,000 employees, “it’s a phenomenal Russian success story,” boasts Cohon. “It started as a Canadian dream with a bunch of us but the growth has been unbelievable and it’s the Russians who now make it successful,” says Cohon, adding, “They have some of the highest-volume stores in the world. The number-1 store in the world is still the first one they opened there in Pushkin Square. And, it’s just beginning for a country that size — 10 years from today, we might be talking about thousands.”
Understandably, with a long list of distinctions, including the Order of Canada, the Order of Ontario as well as the Woodrow Wilson Award for Corporate Citizenship, for bolstering U.S.–Russian relations, Cohon finds it challenging to name his biggest accomplishment. “I’m proud of opening the first store in eastern Canada, proud of becoming the president and CEO of McDonald’s Canada and proud of opening in Russia. But the way for me to answer that question is to ask myself ‘What has getting involved with McDonald’s allowed me to do for other people. And that’s the charities — the Ronald McDonald Houses; the McHappy Day. The pride I have is what I’ve been able to do through McDonald’s, not only to sell hamburgers or to make a profit but to be a good member in communities around the world — to help society.”
In typical Cohon fashion, and in a tip of the hat to Ray Kroc, he’s quick to add he couldn’t have done any of it without the help of the entire McDonald’s team.
Volume 48, Number 9