Skinner and others say this wasn't standard operating procedure before the company embarked on its comeback in 2003. Back then the company was in all-out expansion mode, opening outlets somewhere in the world at the rate of one every 4 1/2 hours. Ralph Alvarez, 51, McDonald's president and chief operating officer, recalls spending six to seven days of his 20-workday month on real estate. That left scant time for things like consumer research. Little surprise that many new products bombed. Case in point: the McShaker salad. Introduced in 1999, it came in a large plastic cup designed to fit a car's cupholder. Problem: Nobody could figure out how to eat a salad while driving. "We were more willy-nilly then," says Skinner. "The attitude was, we'll make it and they'll buy it."

Today the company is adding just 50 to 100 sites a year in the U.S. The shift has freed up billions of dollars in capital, which has enabled McDonald's to quadruple its dividend to $1.2 billion over the past four years, ramp up its share buybacks, and hand out generous subsidies to its 2,400 franchisees to refurbish their stores. Since 2003 the chain has remodeled more than 3,000 sites. Now it plans to convert every location over the next 20 years from its 1980s mansard roof design to a more upscale exterior of earth-red brick and glass accented by a yellow swoosh at the roofline. These new stores could cost up to $1.5 million apiece to build. To help franchisees, the company has agreed to chip in as much as $600,000 per site.

Fred Huebner and his wife, Doris, redid the Garner store last year. Before, the dining room had been a single space, with fluorescent lights and hard-backed chairs and booths. Today it has different zones for different customers. There's the den with its wall-mounted flat-screen TV, a Play Place for kids, and a large high-top table in the middle of the store, behind a frosted glass partition. There are also decorative upgrades throughout, such as bronze sculptures and a fountain.

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Their redesigned restaurant also boasts a McCafé, a separately demarcated space inside the store that sells espresso-based coffees and pastries. It is one of 45 McDonald's in the U.S. testing specialty coffees. The McCafé in Garner doesn't have a separate seating area, but it has its own counter and a display case showing off baskets of muffins and platters of desserts, such as $2.50 tuxedo brownies and cheesecake at $3.25 a slice. In addition to $3.10 cups of latte and cappuccino, the Garner McCafé offers wraps and smoothies.

Kim Borum is impressed by the restaurant's new design touches. It is 12:45 p.m., and she is leaving after joining her husband, Bennie, for lunch. The restaurant had always been conveniently located for the Borums, but she says they now eat at McDonald's two or three times a week. "The ambience of a place makes a big difference in how people feel about it," she says. "If you walk into a place and you see that it's decorated from 1975, the first thing you're going to think is old. And that's a bad thing to think about food."

Late night: The Huebners are a genuine McDonald's success story. The couple, who met at McDonald's in 1977, paid $400,000 for their first store in 1986. They bought their 12th for $1.8 million in September. Their business now generates more than $25 million in annual revenue. They employ 710 people, including their sons, John and Frederick.

Despite their track record, the Huebners were hesitant about staying open all night. McDonald's had begun urging U.S. franchisees to extend their store hours in 2003. It offered $1,000 per site to cover in-store promotional signs and local advertising if they went all the way and never closed. To drum up overnight traffic, headquarters also started dispatching tricked-out rvs to concerts, sports events, and bars to pitch twentysomethings with coupons and contests.

Two months after they decided to go round-the-clock with the drive-through service, Fred Huebner says, his doubts seemed confirmed. Although the outlet already had an after-hours crew that stayed as late as 1:30 a.m. to clean up and another that clocked in at 4:30 a.m. to set up for the new day, the extra hours boosted expenses for payroll and utilities. Even with a limited menu, the store was losing money on the overnight shift. But by the third month the new shift was turning a profit. These days an extra 50 to 60 cars, on average, pull into the drive-through lane every night. The Huebners believe the move probably has helped increase traffic during "shoulder hours," too, since customers no longer wonder whether McDonald's is open.

Elizabeth Williams, a pharmacy technician at a CVS store, is a new McDonald's regular. It is 2:53 a.m., and she is returning home from a bar in Raleigh. A few times a week, before she goes to bed, she says, she stops after an evening out for her nighttime snack: a Premium Grilled Chicken Ranch BLT sandwich, medium fries, and a 32-ounce sweet tea.

Amid the barhoppers, there are also people like Steve Smith. A 45-year-old truck driver, Smith pulls in at 3:15 a.m., on his way to work, for a Quarter Pounder combo meal. He has been eating at McDonald's since he was a kid, and he still comes in at least three times a week. Before the restaurant was open all night, he says, his options were pretty limited: "I'd eat cereal at the house."

The success in Garner's overnight business speaks volumes about McDonald's role today. Although it is well known for the sameness of its food and restaurants, McDonald's is really a lot of different restaurants that cater to a lot of different people. When Huebner started working at McDonald's, there was no breakfast. No Big Mac and no drive-through window, either. Now six of the Huebners' dozen McDonald's are open 24/7, and the rest are open at least 18 hours a day. "Ten years ago we saw every customer as a transaction count," Huebner recalls, "not as a person who needed to use the restaurant in a different way."

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