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McDonald's swot analysis 2017

The document provides a SWOT analysis of McDonald's Corporation, highlighting its global presence, revenue sources, and competition in the fast-food industry. It details strengths like diversified income streams and weaknesses such as inconsistent menu offerings across locations. Additionally, it notes opportunities for growth in markets like China and threats from rapidly expanding competitors.

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MCDONALD’S CORPORATION SWOT ANALYSIS 2017
SLIDE | 2 ABOUT MCDONALD’S Name McDonald’s Corporation Logo Industries served Restaurants (McDonald’s, McCafé, McExpress, McStop) Geographic areas served Worldwide (36,525 restaurants in 119 countries) Headquarters Oak Brook, Illinois, United States Current CEO Steve Easterbrook Revenue US$25.413 billion (2015) decreased 7.4% over US$27.441 billion (2014) Profit US$4.529 billion (2015) decreased 4.8% over US$4.758 billion (2014) Employees 420,000 (2016) Main Competitors Burger King Worldwide, Inc., Darden Restaurants, Inc., Doctor's Associates, Inc., Domino’s, Inc., Yum! Domino’s, Inc., Yum! Brands, Inc., Starbucks Corporation, Wendy’s Company and many other many other restaurant chains.
McDonald’s Corporation business overview from the company’s financial report: “The Company operates and franchises McDonald’s restaurants, which menu of quality food and drinks sold at various affordable price points Types of franchises: • conventional franchise • developmental license • affiliate SLIDE | 3 BUSINESS DESCRIPTION (1/3) “ ”
SLIDE | 4 BUSINESS DESCRIPTION (2/3) “ ” • The Company views itself primarily as a franchisor, with the vast majority of McDonald’s restaurants (approximately 82%) owned and operated by independent franchisees. • Franchising enables an individual to own a restaurant business and maintain control over personnel, purchasing, marketing and pricing decisions, while also benefiting from the strength of McDonald’s global brand, operating system and financial resources.
McDonald’s restaurants offer a substantially uniform menu, although there are geographic variations to suit local consumer preferences and tastes. In addition, McDonald’s tests new products on an ongoing basis. McDonald’s menu includes: • Burgers • Chicken & Sandwiches • Salads & Wraps • Snacks & French Fries • Desserts & Shakes • Beverages SLIDE | 5 BUSINESS DESCRIPTION (3/3) “ ”
SLIDE | 6 STRENGTHS 1. Diversified income streams S W O T McDonald’s doesn’t have to rely on its company- owned restaurants or franchisees to generate the majority of its revenue. Figure 1. McDonald’s and its competitors’ revenue breakdown in 2015 (revenue in US$ billions) Company Company sales % of total revenue Revenue from franchisees % of total revenue Total revenue McDonald’s 16.488 64.9 8.925 35.1 25.413 Yum! Brands 11.145 85 1.960 15 13.105 Burger King 2.169 53.5 1.883 46.5 4.052 Wendy’s 1.438 76.7 0.431 23.3 1.870 Source: The respective companies’ financial reports[1][2][3][4]
McDonald’s income is also much more geographically diversified than its rivals. SLIDE | 7 STRENGTHS Company Income from the U.S. % of total revenue Rest of the world % of total revenue Total revenue McDonald’s 8.559 33.7 16.854 66.3 25.413 Yum! Brands 6.909* 52.7 6.196 47.3 13.105 Burger King 0.982 24.2 3.070 75.8 4.052 Wendy’s 1.749 93.5 0.121 6.5 1.870 Figure 2. McDonald’s and its competitors’ geographic revenue breakdown in 2015 (revenue in US$ billions) Source: The respective companies’ financial reports[1][2][3][4] (Yum! Brands revenues are for China not for U.S.) S W O T
1. Inconsistent menus in different countries • While a localized menu is one of the key strengths of McDonalds, it’s also one of the chain’s weaknesses. • Due to menu differences between different franchisees and directly-owned restaurants, people can no longer expect the same level of service or menu in each McDonald’s restaurant. • Often, you can’t order the same deli wrap or a McRib sandwich in every restaurant in your town. SLIDE | 8 WEAKNESSES S W O T
5. Growing middle class in China SLIDE | 9 IN 2015, MCDONALD’S OPENED MORE THAN 200 RESTAURANTS IN CHINA. OPPORTUNITIES S W O T McDonald’s still doesn’t match the growth of Yum! Brands or Subway stores in China. China’s middle class is growing significantly and will account for 70% of China’s 1 billion population.
1. Intensifying competition SLIDE | 10 THREATS McDonald’s Key Rivals S W O T
SLIDE | 11 THREATS Chick-fil-A and Chipotle are growing on average by 12.7% and ~20% annually in the U.S. S W O T • Burger King and Wendy’s are constantly introducing new meals to directly compete with McDonald’s offerings. • Starbucks is moving away from only selling coffee to becoming a destination for breakfast and lunch. • U.S. fast food industry grows very slowly, yet some chains expand rapidly, taking market share from McDonald’s.
1. McDonalds (2016). Annual Reports. 2015 Annual Report. Available at: http://www.aboutmcdonalds.com/mcd/investors/financial-information/sec-filings.html Accessed January 8, 2017 2. Yum! Brands (2016). Annual Reports. 2015 Annual Report. Available at: http://www.yum.com/investors/secfilings.asp Accessed January 8, 2017 3. Burger King (2016). Annual Reports. 2015 Annual Report. Available at: http://investor.rbi.com/en/investor-information/sec-filings.aspx Accessed January 8, 2017 4. The Wendy’s Company (2016). SEC Fillings. Annual Fillings. Available at: http://ir.wendys.com/phoenix.zhtml?c=67548&p=irol-secAccessed January 8, 2017 5. Interbrand (2016). Best Global Brands 2015. Rankings. Available at: http://interbrand.com/best-brands/best-global-brands/2015/ranking/ Accessed January 8, 2017 6. Forbes (2016). The World’s Most Valuable Brands. Available at: http://www.forbes.com/powerful-brands/list/ Accessed January 8, 2017 7. McDonald’s (2016). What makes McDonald’s. Available at: http://www.mcdonalds.co.uk/ukhome/whatmakesmcdonalds/questions/food/menu/why-is-the-mcdonalds-menu- different-in-different-countries.html Accessed January 8, 2017 8. The Moscow Times (2015). For First Time Ever, McDonald's Closes a Restaurant in Russia. Available at: http://www.themoscowtimes.com/business/article/for-first-time-ever- mcdonalds-closes-a-restaurant-in-russia/519066.html Accessed January 8, 2017 9. Patton, L. (2014). Have We Reached Peak Burger? Available at: http://www.businessweek.com/articles/2014-09-04/fast-food-chains-growth-in-u-dot-s-dot-may-have- peaked#p1 Accessed January 8, 2017 10. QSR Magazine (2014). The Drive-Thru Performance Study: Average Service Time. Available at: http://www.qsrmagazine.com/content/drive-thru-performance-study-average- service-time Accessed January 8, 2017 11. Bloomberg (2014). McDonald’s Costly Burgers Send Diners to Fancier Rivals. Available at: http://www.bloomberg.com/news/2014-10-20/mcdonald-s-costly-burgers-send- diners-to-fancier-rivals.html Accessed January 8, 2017 12. Motley Fool (2014). Once Cheap, Always Cheap: Why McDonald's Can't Raise Its Prices. Available at: http://www.fool.com/investing/general/2014/10/19/once-cheap-always- cheap-why-mcdonalds-cant-raise-i.aspxAccessed January 8, 2017 SLIDE | 12 SOURCES (1/2)
SLIDE | 13 SOURCES (2/2) 13. Motley Fool (2014). 5 Reasons McDonald's Is Falling Apart Before Our Eyes. Available at: http://www.fool.com/investing/general/2014/09/13/5-reasons-mcdonalds-is-falling- apart-before-our-ey.aspx Accessed January 8, 2017 14. ConsumerReports.org (2014). Best and worst fast-food restaurants in America. Available at: http://www.consumerreports.org/cro/magazine/2014/08/best-and-worst-fast-food- restaurants-in-america/index.htm Accessed January 8, 2017 15. Wikipedia (2015). McCafé. Available at: http://en.wikipedia.org/wiki/McCaf%C3%A9 Accessed January 8, 2017 16. Statista (2015). Food delivery industry in the U.S. - Statistics & Facts. Statistics and facts on the food delivery industry in the U.S. Available at: http://www.statista.com/topics/1986/food-delivery-industry-in-the-us/ Accessed January 8, 2017 17. The Guardian (2014). McDonald's will let customers build their own burgers for the first time. Available at: http://www.theguardian.com/business/2014/dec/08/mcdonalds-build- own-burgers-customers Accessed January 8, 2017 18. Marketline (2014). Company Profile. McDonald’s Corporation. Accessed January 8, 2017 19. Basu, E. (2014). Is McDonald's on the Right Track to Turn Around Its U.S. Sales? Available at: http://www.fool.com/investing/general/2014/10/22/is-mcdonalds-on-the-right- track-to-turn-around-its.aspxAccessed January 8, 2017 20. Linshi, J. (2014). How Chick-fil-A Totally Crushed KFC, Popeyes. Available at: http://time.com/2993472/chick-fil-a-mcdonalds-kfc-growth/ Accessed January 8, 2017
SLIDE | 14 GET THE FULL PRESENTATION BUY MCDONALD’S CORPORATION SWOT 2017