2. •How Mc Donald works ??
•Terms of its corporate management
•Food production
•Product development
•Franchiser-franchisee relations.
•Ray Kroc as a crucial figure and a brilliant manager and
salesman.
•Contribution of people towards the growth and success of
McDonald's in important way.
About the Book
3. Founders
• Richard and Maurice McDonalds.
Key People
•Ray Kroc - Individual promoted the Multimixer and through its
promotion, met the McDonalds brothers.
•Fred Turner - Second Chairman and CEO of McDonald corporation
•Jim Schindler- Head of McDonalds Engineering and Design
corporation (Key person in real estate bussiness)
4.
5. Recipe behind the Success
Strategy
Quality Products
Adaptability to
changes
Organize
Operations
Management
Customer
Centric
Robust Strategy
6. Big Idea.. Franchising
• On March 2nd, 1955 McDonald's come up with franchising.
• It was all Kroc's innovations in franchising. He knows that the
business will become cutthroat...
• McDonald's looks for the best locations within the marketplace to
provide our customers with convenience. We build quality
restaurants in neighborhoods as well as airports, malls, tollways,
and colleges at a value to our customers.
• You'll find that our restaurants reflect our commitment of giving
back to the communities in which we do business. When you walk
into any one of our restaurants, you walk into a brand that extends
into the community. Whether our restaurants are built with a
playplace in your local neighborhood or a business center in your
local airport, we aim for every customer in every restaurant to have
the best quick-service restaurant experience, every time.
7. Franchising.. Small idea gives enormous output.
McDonalds
by brothers
Mr. Ray Kroc
and his idea
‘Franchisees’
8. Expand by Marketing .
• McDonald's is an essential piece of Americana and one of
the most iconic brands in the world. The famed golden
arches are recognized by more people than the cross and
even the Queen of England owns a franchise.
• From early on, founder Ray Kroc focused on the
restaurant's marketing orientation, or what the customer
wants in a product, rather than selling the product itself.
McDonald’s has since "become a mastermind of
marketing toward specific markets by pioneering ideas
such as breakfast menus, healthier choices and
alternatives, and 'adult' foods.“
10. On what they worked later:
People management,
Learning factor etc..
What they has:
Business idea, Strong
products and customers
centric services etc..
Possession and Improvement.
11. 1 • We place the customer experience at the core of all we do
• We are committed to our people.
2 • We believe in the McDonald’s System.
• We operate our business ethically.
3 • We give back to our communities
• We grow our business profitably & We strive continually to improve.
Vision and Mission..
12. Strategies applied ..
Permanent
Product Strategy.
Temporary
Product
Strategy
Local Product
Development
Strategy
Local
Adaptation
Strategy
Strategies applied ..
13. Contribution in success.
Quick decision
making.
Adaptability.
Continuous
improvements
Cost reduction
best utilization
of resources.
Bitter lessons of
diversifications
1 Hottinger’s
2 Western World
3 Ramond’s
Products on menu
boards from Germany
Hamburger
university,
McDonald Farms,
Franchising.
14. Secret behind the “Arches” is making money”
Mr. Ray Kroc
Highly
Concentrating on
disciplined
Operation System
Never seen business
by profit & loss
statement
financial Strength-
1956
Receives franchise
fees 1.9% on food
sales out of that
0.5% royalty fees
paid to McDonald
Brothers no motive
to make reserve or
wealth creation
which require for
long run.
15. Making money
The rent due to
McDonald's could be
even more if the
restaurant was doing
well. The franchisee
had to pay either the
stipulated lease
markup or 5 percent
of the sales --
whichever was
higher.
Kroc and Sonneborn
also requested up-
front security
deposits from the
franchisees this
capital would fund
the opening of more
restaurants.
As a result company
owns 69% of its U.S
units & 35 % of tis
International Units by
end of 1991 net book
value
equaled$8.8billion
and 90% of profit
comes from real
estate
16. Final facts about their success
•
Operating Cost less as compare with revenue
• Dedicated suppliers
• Restaurant property
Liabilities are Less
• Long term debt
• capital management
• Property & Equipment
