Mc donald's SCM (ppt)


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McDonald's Supply Chain Management - Pakistan

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Mc donald's SCM (ppt)

  1. 1. Presented to: Mr. Muhammad Taha Dossal Presented by: Maria Farooq Maria Mansoor Ali Mariya Crystal Bilal Majid Mazhar
  2. 2. McDonald’s History • McDonald's originally started as a small hamburger stand in Bernardino, California, owned by Richard and Maurice McDonald in 1945. • Re-opened in December 1948 as a self-service drive-in restaurant. • In 1950s Ray Kroc, a Multimixer Salesman, signs a franchise agreement with Richard and Maurice McDonald in the name of McDonald Corporation at Illinois in 1955. After few years in 1961, Ray purchased the ownership from McDonald brothers. Today 34,000 McDonald's restaurants serving 69 million customers each day in over 119 countries.
  3. 3. McDonald’s Pakistan History • 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 and a week later in Karachi . • Today we have 27 restaurants in 8 major cities of Pakistan. • 11 in Karachi • 10 in Lahore • 1 in Hyderabad, Faisalabad,, Sialkot, Islamabad & Rawalpindi & Kala Shah Kaku).
  4. 4. McDonald’s Statement Vision Statement • To be the best and leading fast food provider around the globe. Mission Statement McDonald's mission is to be our customers' favorite place and way to eat with inspired people who delight each customer with unmatched • Quality • Service • Cleanliness • Value
  5. 5. McDonald’s Values • We place the customer experience at the core of all we do. • We are committed to our people – Employee development. • We believe in the McDonald’s System - Owner/Operators, Suppliers and Company Employees, is our foundation. • We operate our business ethically. • We give back to our communities – Charities. • We grow our business profitably. • We strive continually to improve.
  6. 6. McDonalds‘ Products
  7. 7. McDonald’s Target Market • McDonald’s wants to attract as many customers as it can. But the main targets of the efforts by McDonald’s are following groups: • Parent visit McDonald’s to give the children a treat. • Children want to visit McDonald’s as it is a fun place to eat. • A business customer visits McDonald’s during the day as service is quick, the food tastes great and can be eaten in the car without affecting a busy work schedule. • Teenagers are attracted by the Saver Menu which is affordable, and the internet access.
  8. 8. Supply Chain Management in Fast Food Sector • There are two key components to the fast food industry supply chain; 1. Raw materials are essential to the ultimate product - value added component. 2. Quick, convenient, and quality food. • The most important aspect of the industry supply chain is that it is driven by the consumer. • The consumer has what seems to be an endless amount of fast food chains to choose from every day. • McDonalds' main goal of their marketing is to make the consumer drive that extra two blocks past the competitor to eat at their chain.
  9. 9. McDonald’s Supply Chain Management • Supply chain is extensive and complex. • Efficient, safe and quality food at an affordable price. • Large number of direct suppliers – companies that make or deliver final products to their restaurants. • Large number of indirect suppliers – companies and farms that grow or process the ingredients that are eventually delivered to their direct suppliers.
  10. 10. McDonald’s E-Procurement • McDonalds E-Procurement System is basically a main reason for their successful supply chain management. • It is so efficient that it provides the backbone not only to all the logistics but the whole McDonalds supply chain management. • E-MAC Digital: (Internet procurement site designed for McDonald's Corporation's 34,000 franchises) • E-MAC Digital Company is E-Procurement website which is jointly owned by McDonalds and Accel-KKR Internet Co. • It is a procurement hub launched in 2001 allow all of McDonald's franchises across the globe to buy everything needed to run their restaurants.
  11. 11. McDonald’s E-Procurement • In the process of procuring a product, a typical McDonald’s franchise restaurant places an order through E-MAC digital website. • The order is sent to the suppliers. Suppliers order is processed and managed by the logistics. • The logistics sends the order of the products to the franchise restaurants. It is the responsibility of the E-MAC and logistics that the products are sent to the restaurant. • All the above, steps are handled and executed by the E-MAC digital.
  12. 12. McDonald’s E-Procurement Place Orders Supply Received E-MAC Digital Global Franchises Suppliers Logistics
  13. 13. McDonald’s E-Procurement Major Supplier Small Suppliers E-MAC Digital
  14. 14. McDonald’s Logistics Inbound logistics Operations Outbound logistics
  15. 15. McDonald’s Logistics INBOUND LOGISTICS • It is the movement of materials from suppliers and vendors into production processes and storage facilities. • Based on the demand forecast, Manager orders the Venus Distributors on daily basis. • Venus Distributors stores all the raw materials, in its own cold stores and delivers only one-day material to the restaurant. • Venus Pakistan established its dedicated McDonalds Logistics Operations in 1997. • It also received the DQMP (Distribution, Quality, and Management Process) Certification from McDonalds USAAudit Team. • Some branch has its own cold storage facility, which is used to store the daily-procured raw material.
  16. 16. McDonald’s Logistics INBOUND LOGISTICS • There are only two products buns and Cokes, which are sent directly to the restaurants. • Venus Pakistan has full-fledged facilities to pack locally manufactured products in sachets such as sugar, tomato ketchup.
  17. 17. McDonald’s Logistics • The transportation of McDonald’s has been completely outsourced and since 80% is in refrigerated truck movement. • Multi-temperature and single temperature trucks transport the fast food swiftly to the McDonald’s restaurants across the country. • The company has both cold and dry storage facilities with capability to store products up to -22º C as well as delivery trucks to transport products at temperatures ranging from room temperature to frozen state. • The specially designed trucks maintained the temperature in the storage chamber throughout the journey.
  18. 18. McDonald’s Logistics COLD CHAIN LOGISTICS • A cold chain is a temperature-controlled supply chain. • It is used help extend and ensure the shelf life of products such as fresh agricultural produce, processed food. McDonalds’ entire network supply-chain consists of movement of goods through a cold chain An interesting and innovative feature of this cold chain is that the same truck can carry products at different temperatures ranging from: • Frozen products at -18C to -25C • Chilled products from 1C-4C • Dry products at ambient temperatures
  19. 19. McDonald’s Operation • Cooking procedure and recipe is documented so that the products become standardized and customers get the similar taste, quantity and quality to whichever restaurant they go. • It is the policy of McDonald's to throw away any burger if they remain on heated grill for 15 minutes. • All the utensils and equipment used in cooking are washed at the closing of restaurant every night, with anti-microbial fluid. Kitchen, floor, washrooms and all other restaurant areas are cleaned after every half an hour.
  20. 20. McDonald’s Logistics OUTBOUND LOGISTICS • Outbound logistics is the process related to the storage and movement of products from the end of the production line to the users end. • When customers enter the restaurant, they go to the counter, give their order, which they are served within a single minute.
  21. 21. McDonald’s Distribution McDonalds Distribution systems McDonald uses three types of distribution strategy; • Franchising • Licensing • Joint ventures
  22. 22. McDonald’s Forecasting McDonald’s uses qualitative forecasting methods to help aid in predicting the future growth of the organization; • Market Research – customer focus and information gathering from customer and employees (through surveys). • Expert Opinions and judgment – Delphi Technique.
  23. 23. McDonald's Competitors • Subway • Kentucky Fried Chicken (KFC) • Mr. Burger • Burger King
  24. 24. Factors that Influence Competition Price Quality Flavor Outlets
  25. 25. McDonald’s Market Share Market Share McDonalds KFC Subway Mr. Burger Burger King Others 25% 15% 10% 5% 15% 30%
  26. 26. McDonald’s SWOT Analysis •Political instability. •Economical instability. •Health conscious customers. •Innovative advertisements. •Offer organic food line. •Expand menu to cater all individuals. •Gain attention by sponsoring adult or children programs. •Introduce outlets to different locations. •Lack of innovative advertisement. •High setup cost. •Offers processed and inorganic food line. •Extensive and costly training program. •Brand Name. •Research and Development. •Loyal Customers. •Diversified Culture. Strength Weakness ThreatsOpportunities
  27. 27. THANK YOU