In 1940 brothers Maurice and Richard McDonald opened a barbecue restaurant in San Bernardino California which they simply called "McDonald's." They originally offered things like grilled pork chili and ham and beans but in 1948 they changed their model after the brothers noticed that hamburgers were the most popular item on the menu. After a three-month closure for remodeling they reopened with a nine-item menu including a hamburger that cost just 15 cents.
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The Rise and Fall of the Dollar Menu
In fact all items on the menu cost less than a quarter which was cheap even for that time. The cheapest item on their original barbecue menu was a coffee for just 5 cents and the most expensive was a barbecued plate or hamburger steak for 60 cents. While the price of coffee doubled under the new model to a whopping 10 cents dessert was a vanilla chocolate or strawberry milkshake for 20 cents. A year later in 1949 McDonald's legendary French fries replaced the potato chips on the menu for 10 cents a serving.
The McDonald brothers were able to offer this new menu at such reasonable prices thanks to their new Speedee Service System. Inspired by the assembly lines at Ford Motor Company this system had workers prepare hamburgers and cheeseburgers very quickly. Once the burgers were cooked they were placed under warming lamps so they were ready when customers arrived. This meant that customers could drive away with a full meal just minutes after ordering. Ultimately this model was successful and eventually led to the opening of thousands of McDonald's locations worldwide.
In 1949 anyone lucky enough to have a $5 bill in their pocket could buy four items on the entire McDonald’s menu with change for a few extra items. In addition to $0.15 hamburgers $0.20 milkshakes and $0.10 coffee you could also get a cheeseburger for $0.19 and fries milk root beer orangeade or Coca-Cola for just $0.10 each. These nine prices add up to a total of $1.14. Adjusted for inflation that’s the equivalent of about $15 in August 2024. Getting nine equivalent items from the 2024 McDonald’s menu would cost just over $20.00 about $6.00 more than the inflation estimate.
