McDonald Comparative Analysis


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include all the analysis of the company. You will find SWOT analysis also in it. Also a detail Information about the product and the company.

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McDonald Comparative Analysis

  1. 1. Well come Mcdonald
  2. 2. Group Members Mr. Haroon Jutt Miss. Ume Habiba Miss. Tahira Mr.Saqib Ahmed Miss Raheela
  3. 3. Introduction:  The company we have selected is world one of the largest fast food Restaurants famously known as “MACDONALD”.  Company is very large that it serving almost 70 millions customers daily and that’s not all its braches are exceeded in almost 119 countries.  The company Headquarter is located in United States and started in 1940 as a barbecue restaurant operated by Richard and Maurice McDonald.
  4. 4.  McDonald’s Pakistan is part of the Lakson Group of Companies, a leading business house in Pakistan.  McDonald’s first restaurant opened its door to the people of Pakistan in September 1998 in Lahore. This launch was met with unprecedented enthusiasm from the citizens of Lahore, who are known for their liveliness, vigor and penchant for quality food. Karachi opened its first restaurant a week after Lahore.  Ever since we opened the doors of our restaurants both in Karachi & Lahore, we have been proud to provide our customers the same great taste, outstanding value and superior service that is synonymous with the Golden Arches all over the world.  There are now 27 restaurants in 8 major cities of Pakistan. (11 in Karachi, 1 in Hyderabad, 10 in Lahore and 1 in Faisalabad, 1 in Kala Shah Kaku, 1 in Sialkot, 1 in Islamabad & 1 in Rawalpindi) Introduction:
  5. 5. Vision To be the best and leading fast food provider around the globe Mission McDonald's brand mission is to be our customers' favorite place and way to eat, and improve our operations to provide the most delicious fast food that meet our customers' expectations.
  6. 6. Restaurant Ownership We view ourselves primarily as a franchisor and believe franchising is important to delivering great customer experiences and driving profitability. At year end 2010, 80% of McDonald’s restaurants were franchised. Of the total McDonald’s restaurants worldwide: • Nearly 59% are conventional franchisees • 21% are licensed to foreign affiliates or developmental licensees • Nearly 20% are Company-operated
  7. 7. CompanyProfile: McDonald's Corporation Restaurants, Food Worldwide U.S. Don Thompson $ 5.46 billion (2012) 1,800,000 (2013) Burger King Worldwide,Inc., Subway • Name • Industriesserved • Geographic areas served • Headquarters • Current CEO • Profit • Employees • Main Competitors
  8. 8. SWOT Analysis : Strengths • Largest fast food market share in the world: McDonald’s is the largest fast food restaurant chain in terms of total world sales (8%). It is the second largest outlet operator with more than 34,000 outlets, serving 69 million consumers every day in 119 countries. • Brand recognition valued at $40 million: Company’s brand is the most recognized brand in fast food industry and is valued at $40 billion. McDonald’s is also famous by the Ronald McDonald clown. • $2 billion advertising budget: McDonald’s spends on advertising more than any other food company.
  9. 9. • Locally adapted food menus The fast food chain is operating in many diverse cultures where tastes in food are extremely different than those of US or European consumers. Thus ability to adapt to local tastes is one of McDonald’s strengths. • Partnership with best brands: McDonald’s offers only most popular brands in its restaurants, such as: Coca Cola, ketchup and others. • More than 80% of restaurants are owned by independent franchisees: Therefore, McDonald’s can focus more on perfecting its serving system and marketing campaigns. • Children targeting The business successfully targets very young children through offering playgrounds, toys with its meals and advertisements.
  10. 10. Weaknesses • Negative publicity: McDonald’s is heavily criticized for offering unhealthy food to its customers, stimulating obesity and strong marketing focus on very young children. • Unhealthy food menu: Although McDonald’s tries to introduce healthier choices in its menu, the menu is largely formed of unhealthy meals and drinks. Such menu offering prompts protests by organizations that fight obesity and hence, decreases McDonald’s popularity. • Mac Job and high employee turnover Mac Job is a low paid and a low skilled job, which is often seen negatively by its employees. This results in lower performance and high employee turnover, which increases training costs and add to overall costs of McDonald’s. • Low differentiation: McDonald’s is no longer able to substantially differentiate itself from other fast food chains and opts to compete by price rather than by additional features.
  11. 11. Opportunities • Increasing demand for healthier food: While demand for healthier food increases, McDonald’s could introduce more healthy food choices in its menu and reverse its weakness into strength. McDonald’s is trying to seize such an opportunity and soon plans to open only vegetarian restaurant in India. • Home meal delivery: McDonald’s could exploit an opportunity of delivering food to home and increase its reach to customers. • Full adaptation of its new practices: McDonald’s has redesigned its logo and restaurant design in 2006. In addition, it has introduced some new practices. In a result, remodeled restaurants have seen 8-9% higher than average market growth. McDonald’s should finish remodeling all of the restaurants and adapt the best practices in them as soon as possible. • Changing customer habits and new customer groups Changing customer habits represent new needs that must be met by businesses. So far, the company has been successful in introducing its McCafé, McExpress and McStop restaurants to meet the changing customer habits and the needs of previously untapped customer groups.
  12. 12. Threats • Saturated fast food markets in the developed economies: The fast food market in the developed countries is already overcrowded by so many fast food restaurant chains and this already proves to be a threat to McDonald’s as it barely grew through 2012. • Trend towards healthy eating: Due to government and various organizations attempts to fight obesity, people are becoming more conscious of eating healthy food rather than what McDonald’s has to offer in its menu. • Local fast food restaurant chains: Local fast food restaurants can often offer a more local approach to serving food and menu that exactly represents local tastes. Although McDonald’s does a great job in adapting its own menu to local tastes, the rising number of local fast food chains and their lower meal prices is a threat to McDonald’s.
  13. 13. • Currency fluctuations: – The business receives a part of its income from foreign operations. The profits that are sent back to US have to be converted into dollars and may be affected by the exchange rates, especially when the dollar is appreciating against other currencies. In 2012, McDonald’s profit was largely affected by appreciating dollar. • Lawsuits against McDonald’s: – McDonald’s has already been sued for many times and lost quite a few lawsuits. Lawsuits are expensive as they require time and money. And as McDonald’s continues to operate more or less the same way, there is high probability for more expensive lawsuits to come.
  14. 14. • Global Strategies: McDonald’s Vision is to be the world best restaurants according to quality and their services which make their customers happy. Following are some strategies which McDonalds are following. • Franchise Model: As per franchise model of McDonalds only 15% of total world restaurants are owned by company the rest 85% are operated by franchise.
  15. 15. • Advertisement There are many McDonalds advertisement method and they are using like different slogans which is attracting their clients. The best thing is that they never used comparison ads or you can negative ads of their competitors. They are using 140 slogans in whole world and out of this 23 is used in USA. • Indian Market As we know that Indian mostly prefers vegetarian food as compared to beef and other food. So company is thinking or you can say acting according to it. Their lifestyle and way of livening is totally different. So,
  16. 16. • Worldwide Growth: There are two things on which McDonalds focus most. Adding New Restaurants Maximize sells and profit their. And they are doing it by better operation, innovation and product development. • Target Segments McDonalds are targeting 3 classes mostly. But they are not limited to that yet; there are some special offers and promos for them.  Children  A business Customer  Teenager
  17. 17. • Co-Branding Strategy: Co-branding strategy is also one of the beneficial instruments for boosting the business and providing different the same things in different manners. In fact co-branding means having a tie ups with another firm and serving the customer with both the products. It helps in making profit for both the business enterprise as well as the increase their sales and growth of organization. There are different types of co-branding strategy is used by McDonalds. • COCA-COLA Coke is one of the soft drink brand that has joined the hand of McDonalds since last few years. Company knows that they are at their best position and they still can increase by adding one more product in their service which is already used by millions of customers.
  18. 18. • Walt Disney One of the famous places for children’s where they can enjoy lots of things. Walt Disney joined the hands of McDonalds specially for the purpose of selling “HAPPY MEAL” in which kids can enjoy different toys. • Opening outlets in Petrol Pumps One of the best strategies they are following that they are opening large amount of outlets in petrol pumps. And this strategy they are following mostly in India that because they know about their population and demand of particular areas.
  19. 19. Current Best Marketing Strategy: In McDonald’s there is a strategy named “Plan to Win” since 2003. This plan to win in the industry exist till now and it forced McDonald’s to have 32 months of global comparative positive sales which is the longest strip for the last 25 years. To say more, company has had a growth which in general lies above the industry average growth. “Plan to Win”? It is nothing else except 5P’s that are behind the Plan to Win, it includes: People, Place, Product, Price, and Promotion. The 5P’s are trying to perceive every thinkable angle of the company, and have ways to improve everything, from refurbishing old shops, to maintenance Wi-Fi for customers, setting the right mood with music and creating deli menus to cope with the bad publicity.
  20. 20. • Promotion – “I’m loving it” worldwide campaign – Billboards, internet, TV, all advertising in general • Price – High Quality food at reasonable Price – Value Deals • Place – Easily Accessible – Near to residential areas • Product – Wide range of food selection – High Product standard • People – Training programme for delivering best services to their employees – (ROIP) Restaurants operation improvement process – Future Forecast
  21. 21. Critical Analysis of Company: No doubt that company is one of the leading fast food industries. But, there are some competitors that are eating their shares. Famous companies like Pizza Hut, Dominos and KFC are at the top of the list. They are not only serving best food to their customer but they are also delivering product fast to consumer. The thing is now days most of the companies are focusing on satisfying the customer and not concentrated in the time which is affecting the company in different manner. The main things in which they have to compete with each other is following.  Minimizing the Cost  Speed  Healthy Food • Competitors
  22. 22. • Political factors The international operations of McDonald’s are extreme under influence of a policy of the separate state put into practice by each government. For example, there are certain groups in Europe and the United States which demand the acts of governmental power concerning medical values of meal of fast food. • Threat of new entrants The threat of new entrants in the fast food industry is high because there are no legal barriers which would keep them from entering the industry. • Economy: Economy is important factor which is impacting McDonalds. Company always need to thing about profitability, growth, to expand of company. So, they need to consider countries demand, supply, production, distribution, exchange rate, business cycles, and differential economic growth rates around the world
  23. 23. • Environmental factors: McDonald's is growing day by day by increasing the number of restaurant. The main source of ingredient and packaging is nature. McDonald's has a Rain Forest Policy, which declares its commitment to beef purchasing practices that do not contribute to tropical de- forestation. Everyday McDonalds using a huge amount of napkins, carryout bag, tray lines, clamshells. Oil and water is other major ingredient using in McDonalds. . The continuous and enormous use of natural resources can disturb the balance in the ecosystem. In Europe, McDonald's has been recycling vegetable grease by converting it to fuel for their diesel trucks Now, every body are conscious about environment. So, McDonalds need to careful about environment that, what McDonalds are doing that's environmental friendly. • Culture and religion: McDonalds is doing business worldwide. So, different regions customers got different culture and religion. McDonalds need to think about, cultural and religion rules and tradition. For example, in India, the non-vegetarian menu includes chicken and fish items only. Beef is not on the menu in India because are considered sacred. Like that, in Muslim McDonald's introduced halal meat for burger.
  24. 24. • Management Practice Following are some management practices which they are following. • (JIT) system of inventory management JIT, as the name suggests, is the system of supplying products to customers as soon as they have ordered for it, with minimal delay between placing the order and getting it in hand. McDonalds doesn’t begin to cook or assemble or preheat their stuff until they receive a customer order • Employees • Work at time, are neatly dressed and are clean. • Often make sure that their customer receive safe food • Following standard operation procedure.
  25. 25. • Food • Proper maintain of food • Proper cocked • Restaurants • Should be clean and fast delivering services available. • Manager Role • The most important thing that leads to McDonald's success is managers willing to do what it takes to follow procedures and implement policies that ensure employees follow procedures, not to mention riding crew and other managers' asses in regards to training those procedures and following up with them on the procedures, all the time!
  26. 26. Suggestions • As we know that McDonalds is best fast food company out here but still they need to improve some specific areas. • They should open online order form. This will surely increase more profit? • Contact with supplier directly so they know that product which is transferred by them is good like quality wise etc. • They should also focus on customer services. • Dealing with Healthy Food and Quality Product
  27. 27. Conclusion McDonald’s faces some difficult challenges. Key to its future success will be maintaining its core strengths. They still need to improve some areas on the basis of which they can even become more successful. The most important thing is that they need to focus more on their competitors and upcoming market fast food companies that because they are big threats for the company. Otherwise their will lots of issue they will have to face.
  28. 28. Reference • Mr. Javed Ahmed MBA Student “Critical Analysis on Food Industries” 2007 • Robert Broughton Quality Assurance solution, USA Blog. • McDonalds official website Information about their past history and annual Report. • McDonald’s Investors (2013). Company profile. Available at: pany_profile.html • Wikipedia (2013). McDonald’s. Available at:'s • McDonalds Career Report: mcdonalds-is-successful.html
  29. 29. THE END