Case Summary:
McDonald’s is an International food product brand of America. It started its journey with its first opening in 1955. The owner Ray Kroc offered high quality menu, moderately priced food served fast in spotless surroundings. McDonald’s QSC&V (quality, service, cleanliness & value) was a big hit. And soon it gradually expanded to 119 countries all over the world by 2007. That’s not all; McDonald’s takes time to expand itself through planning in different countries. It took 14 years for the company to open its first outlet on Moscow. But the time taken was not a waste. People were found to stand in line for 2 hours for just a Hamburger. Even the Beijing opening in 1992 drew about 40000 people to the opening day. McDonald’s has made it’s rules very flexible for which they follow the local laws for preparing the food. For example, the menu in Arab countries follow Islamic rule of food preparation. Even in Jerusalem no dairy products are served.
So, it can also be said that McDonald’s has made it possible for people to find other cultures in their own culture. Although McDonald’s has made it’s activities quite flexible, it does not compromise it’s QSC&V rule. The company revoked its first franchise in France for not maintaining the standard of fast service and cleanliness. But McDonald’s has it’s own method of appointing its employees. The Owners and managers attend the Hamburger University near Chicago or other places around the world to learn how to operate a McDonald’s restaurant and maintain QSC&V. McDonald’s also ensures consistent products by controlling every stage of distribution. The company also follows a strategy where it believes, be first in a market and establish its brand as rapidly as possible. McDonald’s has its structure in variety of forms, with 66 percent of the restaurants being franchises.
It operates about 21 percent of the restaurants. But within all this success, the company is now facing some serious competitions such as, Burger King, Wendy’s, KFC etc. Due to its decreasing popularity from 2001 McDonald’s has started to change its appearance. It has introduced McCafe to capitalize the latest trend. McDonald’s introduced it’s “Forever Young” brand by redesigning all of their restaurants. It has also introduced three new different areas in the restaurants, the linger zone, the grab and go zone and the flexible zone. Even after all the thrive the company is going all the way to success. So it has become crucial for the company to keep innovating and introducing new alternatives in order to attract new and old McDonald’s lovers.
Q:1. What opportunities and threats did McDonald’s face? How did it handle them? What alternatives could it have chosen?
