3 Investing Lessons In The Food That Built America

It is pretty interesting to learn of all the little innovations like this. Henry Heinz's idea to package ketchup in clear glass bottles to display the product seems basic today but was a revolutionary idea for its time.

The story here is that innovative companies are the companies that can grow the fastest. And growing a business fast usually equates to a rapidly growing investment. Look out for this key characteristic!

If You're Gonna Think Anyway, Think Big

Innovation is great, but to really capitalize on it, companies need to think big - really big!

The best example of this in the show is the story of McDonald's. Dick and Mac McDonald's "Speedee" system was an incredible innovation. At the time, drive-in diners were the rage, but they were slow and inefficient. Dick and Mac realized this from running a drive-in barbecue, having trouble turning a profit. They analyzed their sales and noticed that just a few items - burgers, fries, sodas, and milkshakes - made up 80% of sales (a good illustration of the "Pareto Principle"). Around this knowledge, they designed a system based on speed and efficiency, where customers could be served in a matter of seconds instead of 30 minutes or more.

It was just about this time that the U.S. interstate system was coming online, opening up a new rush of car travel across the country. Travelers did not want to wait for food. Ray Kroc - a traveling salesman - found the McDonald's restaurant and was blown away by its speed and efficiency.

Ray Kroc immediately thought big - franchise this across the USA! But the McDonald brothers were more focused on absolute adherence to their formula, reluctant to sell franchises. Still, they agreed to let Kroc try it.

We all know what happened next. Ray Kroc was wildly successful, adding his own twist to innovation (a landlord aspect to the franchising model), and pushing the concept across the country. Eventually, he became big enough to buy the McDonald brothers out. It was his big thinking that took an important innovation and made it into a powerful global company.

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Disclaimer: The content is provided by Alexander Online Properties LLC (AOP LLC) for informational purposes only. The material should not be considered as investment advice or used as the basis ...

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