The Purposes Of Mcdonalds

Published Date: 02 Nov 2017

INTRODUCTION

McDonald's fast food restaurant is one of the largest franchises in the United States as well as aboard. Their top menu items include: hamburgers, cheeseburgers, McNuggets, and French fries. They are also known for one of their popular desserts: the apple pie and their breakfast sandwich: the Egg McMuffin. There are more than 32,000 McDonald's restaurants serving in 117 countries. More than 75% of McDonald's restaurants worldwide are owned and operated by independent owners. McDonald's has several ethical and social responsibility policies in place throughout their solely owned and franchised companies. These policies include placing the customer experience at the core of what they do, committing to their employees by nurturing their talent and rewarding their achievements, maintaining high standards regarding the conduct for business, and giving back to the communities in which they are established. All of these values are infiltrated through all levels of the company, which keeps McDonald's thriving as a successful fast food chain restaurant. Risk management is imperative to McDonald's. They have a risk assessment tool that they use to determine the country risk: which pertains to the specific country/region they are located in; industry risk: pertains to supplies produce; and facility risk: which is a combination of both country and risk groundwork. These factors are all part of the risk assessment tool that is used in each of their companies to help them with risk management.

Security features in McDonald's includes their security camera systems within the facilities to continuously monitor all activity in and around the restaurants to ensure the safety for the workers as well as customers. McDonald's use these security cameras also in regards to workers compensation claims or liability lawsuit claims from consumers.

TASK 1

Compare the purposes of McDonalds with that of any known non-governmental organization.

Statement of Purpose of McDonald’s

McDonald’s Corporation has established the McDonald’s Corporation Severance Plan to provide financial assistance through severance payments and other benefits to employees on the United States payroll who are subject to United States taxation and whose employment with an Employer hereunder is terminated in a Covered Termination.

The Plan is intended to be an unfunded welfare benefit plan for purposes of the Employee Retirement Income Security Act of 1974, as amended, and a severance pay plan within the meaning of the United States Department of Labor regulation section 2510.3-2(b). All prior existing severance pay plans, programs and practices for employees (other than the McDonald’s Corporation Change of Control Severance Plan), whether formal or informal, are hereby revoked and terminated for Covered Employees. This document applies to Covered Employees whose Covered Termination occurs on and after January 1, 2008. Except as provided in Section 4.1 of the Plan, the payment of severance benefits to any Employee who had a Covered Termination prior to January 1, 2008 shall be determined in accordance with the terms of the Plan in effect at the time of such Employee’s Covered Termination

McDonald's Corporation is the world's largest chain of hamburger fast food restaurants, serving around 68 million customers daily in 119 countries. Headquartered in the United States, the company began in 1940 as a barbecue restaurant operated by Richard and Maurice McDonald in 1948 they reorganized their business as a hamburger stand using production line principles. Businessman Ray Kroc joined the company as a franchise agent in 1955. He subsequently purchased the chain from the McDonald brothers and oversaw its worldwide growth.

A McDonald's restaurant is operated by either a franchise, an affiliate, or the corporation itself. The corporation's revenues come from the rent, royalties and fees paid by the franchisees, as well as sales in company-operated restaurants.

McDonald's primarily sells hamburgers, cheeseburgers, chicken, french fries, breakfast items, soft drinks, milkshakes and desserts. In response to changing consumer tastes, the company has expanded its menu to include salads, fish, wraps, smoothies and fruit.

Subway is an American restaurant franchise that primarily sells submarine sandwiches (subs) and salads. It is owned and operated by Doctor's Associates, Inc. (DAI). Subway is one of the fastest growing franchises in the world with 37,881 restaurants in 98 countries and territories as of November 7, 2012.It is the largest single-brand restaurant chain globally and is the second largest restaurant operator globally after Yum! Brands (over 37,000 locations).

Subway's main operations office is in Milford, Connecticut; five regional centre support Subway's growing international operations. The regional offices for European franchises are located in Amsterdam, Netherlands; the Australia and New Zealand locations are supported from Brisbane, Australia; the Asian locations are supported from offices located in Beirut, Lebanon, Malaysia, Singapore and India and the Latin America support centre is in Miami, Florida.

The Subway restaurants chain's community project has taken on the cause of two social issues: hunger and obesity, with a unique marketing campaign Fit to Fight Hunger. Nearly 1600 restaurants in California, Hawaii and Utah will be participating in this piggyback type campaign, hoping to raise awareness for the rising needs of local food banks, while also promoting their low fat Subway Fresh Fit sandwiches and encouraging customers to make healthier eating choices.

Comparison between Mc Donald and Subway

McDonald’s Menu Nutrition Facts

McDonald’s on the other hand seem to have suffered from a multiple of personality disorder. They are tirelessly campaigning about their healthiness in the meal they offer e.g. their salads, and their healthy options – even persuading athletes to appear in ads. One thing good about McDonald’s that they serve it real fast is, you can walk in there, order something, slap money down, and be walking out with food within 60 seconds. While some claim that the menu in McDonald’s is cheaper compare to Subway. But sorry if you thinking of having a fresh vegetable there as most of the time the foods are served in deep fried or deep grilled in most country. You can check out McDonald’s nutrition chart here McDonald’s Nutrition Value.

Subway’s Menu Nutrition Facts

Subway always offer meal with a comparatively low calories from fats. However the nutrition from Subway may vary depend on the person who prepares the meal. If you check out Subway’s nutrition chart here – Subway Nutrition Value you can find that most of the sandwiches served are less than 400 calories. And most of the item are low in fat, cholesterol and free from trans-fat while Subway always serving fresh ingredient, not fried and adding lots of veggies in the menu. But the calories and fat level will go up if you happen to add some cheese or mayo to these sandwiches. Its price will be slightly more expensive compare to McDonald’s, however Subway is still a preferable choice for most of the fast food lover out there due to its healthy menu choices.

      On the health scale, McDonalds outshines Subway.  As we can see, McDonalds has less in most categories. The person relying on solely Subway would be unhealthier.  In fact, both people eating McDonalds, and Subway only would have so many health problems; they might not even be alive. For example, looking only at the sodium, 1000, and 800 are huge numbers, and will likely result in high blood pressure, and eventually a stroke.  This is in fact why McDonalds does serve better and healthier food than Subway. .

    In conclusion, Subway doesn’t serve better food than McDonalds, because of the artificial ingredients they use, and the health problems that could amount by eating Subway.  On the other hand, Subway is just as bad, because of the high calories, fat. For example, which can amount to strokes, or heart attacks.  This is why McDonalds serves better and healthier food than Subway.

 Task 2

Identify the responsibilities of McDonalds within its environment and the strategies it has adopted to meet them.

One of the first results of the task force was the development of a strong company-wide environmental policy declaring that McDonald’s is committed to protecting the environment for future generations, and that it believes that business leaders must also be environmental leaders. The policy takes a total lifecycle approach to reducing and managing solid waste: a sizable challenge, considering that each of McDonald’s 8,600 U.S. restaurants 3 238 pounds of waste per day and each of its 34 U.S. regional distribution centre disposes of another 900 pounds of waste per day.

Striving for a sustainable future

At McDonald's we recognise our responsibility to protect and preserve the environment for future generations to come. Our goal is simple, all of our activities are centred around the key priorities of reduce, reuse, recycle and redesign with the aim to use less energy

LITTER

McDonald's restaurants operate very much as part of their local community and quite naturally, therefore, take pride in the appearance of the local environment.

WASTE

Used cooking oil represents 10% of a restaurant's total waste, and is recycled into biodiesel, which our delivery fleet runs on

PACKAGING

By replacing our plastic salad containers with a paper card base we have reduced by nearly 69 tonnes the amount of plastic we purchase as a company

ENERGY

All our restaurants use low energy lamps and have light level sensors installed to control external lighting. All new lighting systems also have high frequency fittings

Greenhouse emissions

In our operations, energy use accounts for the bulk of C02 emissions so our focus in this area is primarily on reducing electricity consumption. We participate in the federal government’s Energy Efficiencies Opportunities (EEO) Program and our EEO public report outlines our energy usage and identifies opportunities for improvement. We are also required to report our greenhouse gas emissions under the federal government’s National Greenhouse and Energy Reporting Act and the results for this are published online by the Department of Climate Change.

 Water usage

We have participated in the Sydney Water Every Drop Counts business program since 2001 and currently 194 restaurants in the Sydney Water Catchment are registered with the program. Participation in the program helps monitor water usage, identify opportunities for improved water management practices and helps implement water saving measures.

Clean environment

Our Clean Streets program includes initiatives designed to keep the area around our restaurants tidy and clean. The key to this is the Litter Patrol program which is a structured and regular task for crew members who pick up litter from within the restaurant grounds and in neighbouring streets. Within the Clean Streets program we also use packaging, restaurant tray mats and car park signage to remind our customers not to litter.

Supply

Our responsibility to the environment spans the entire life cycle of our products. It starts with the fresh ingredients at the farm and the design of our food packaging, and extends through food manufacture, customers and waste disposal.

Advocacy and partnerships

More and more we are working with experts, environmental organizations and government agencies to learn from them, offer our support and build cooperative relationships.

Culture and communication

A focus on the environment is part of our culture and affects the decisions we make every day. Continuous improvement is also an important part of McDonald’s overall business culture and this attitude also directs our journey towards environmental sustainability. We have numerous communication channels in place to inform our people of environmental initiatives and encourage participation in events such as Clean Up Australia Day and Earth Hour.

Task 3

Investigate the behaviour of the organization in its market environment.

Business Environmental Analysis Of McDonalds

McDonald’s is one of the largest food chain all over the world is serving remarkable number of customers worldwide daily. McDonald’s has made a high profile brand image because its quality food, quick service, cleanliness, everyday value and so on. Experienced management, advanced operational system, customer-friendly policy, modern infrastructure, information system etc. have given McDonald’s unique position to compete the highly competitive market. In 1948 McDonald’s begins its activities in U.S.A and it experienced the taste of success from the beginning. In 1955 it was introduced as ‘McDonald’s Corporation’ founded by Ray Kroc. In 1967, the company started to extend its business worldwide. Now McDonald’s is one of the biggest and reputed global food service retailers in the world. According to the annual report, McDonald’s operates 32000 restaurants across 117 countries.Not only in food service retailing but also in job market it provides huge range of opportunities for a remarkable number of people worldwide. Moreover, as McDonald’s has high brand image, it gives huge returns for its shareholders. However, sometimes McDonald's is criticised for its high turnover rates and junk food.

Business Environment

The business environment means the overall (internal and external) circumstances of organization. Every organisation including McDonald’s is more or less influenced by environmental factors. In business discussion, internal factors of an organisation are discussed as a part of Micro Environment and external factors are treated as Macro Environment.

Macro environmental analysis

Macro analysis is also known as PESTEL analysis which stands for-

Political factors

Economical factors

Social factors

Technological factors

Environmental factors

Legal factors

Political factors

The business operation of an organisation is always influenced by the policies of state and its government. McDonald’s business is also under the control of government’s rules and regulations. The main issue of controlling food business is health and other issues are license, employee laws, tax issues etc. McDonald’s follows the local government’s policies as well as foreign investment policies on its franchise business strategy. Political instability of local state is also affects McDonald’s business.

Economical factors

Economical factors always come as vital issue to business organisations. For example, more or less all companies are affected by ongoing global economic slowdown. Due to international business operation, McDonald’s faces different scale of tax and revenue measurement in different country. McDonald’s also faces difficulties because of international currency fluctuations especially in its global food distribution. Local economical condition is also responsible for affecting McDonald’s operation. If the local economy is critical, people are usually discouraged to spend more money for their food. As a result, company is affected.

Social Factors

The life style of people is being changed and the demand of this change affects McDonald’s. The people of this modern urban society expect the highest level of service and all the latest facilities from a hospitality organisation. In addition, this changing demand is different in society to society and country to country. For example, in India, Hindu people prefer vegetable, Muslim people avoid pork. To fulfil the customers’ expectation, McDonald’s needs to research the market and also needs to provide effective food menu.

Technological factors

The impact of technological innovation is also considerable to meet the customers’ expectation. As all existing food chains for instance, KFC, Pizza Hut etc, compete each other, McDonald’s has to ensure the all technological access to influence the customers. Modern and speedy distribution channels, easy and quick payment facility, customer entertaining equipment in store, wireless internet facility in all stores etc. can help McDonald’s to keep on its success.

Environmental Factors

McDonald’s is criticised for using some harmful elements for example, non-biodegradable substances for its drinks glasses. Styrofoam containers are also being used in McDonald’s for meals and it is seriously discouraged to use. Environmentalists criticize McDonald’s because of food packaging based on polystyrene. For the greater interest of environment issue, franchisees are called by environmentalists to be aware about this issue.

Legal Factors

It is mandatory to follow some rules and procedures to run its operations. For example, registrations, taxes, stuff laws, safety rules etc. In Muslim countries, it is important to have Halal food authorisation and McDonald’s should care the customers’ belief on it. If every company maintains the legal process, not only the company itself but also every part of our society will be benefited. McDonald’s, as a giant food chain, has to be seriously responsible regarding legal issues.

Micro Environmental Analysis

Micro environment covers the internal factors which influence the operations of organisation. McDonald’s is influenced by its internal factors .The internal factors are-

Suppliers

Competitors

Customers

Publics

Intermediaries

Suppliers

McDonald’s has its own suppliers and it practices very close relationship with suppliers. McDonald’s divides its suppliers into two divisions who are called direct suppliers and indirect suppliers. The indirect suppliers deliver the ingredients to the direct suppliers and the direct suppliers produce the food for McDonald’s. McDonald’s understands the importance of its suppliers and always co-operates with professional manners. (aboutmcdonalds.com)

Competitors

As the global market of 21st century is highly competitive, McDonald’s has some strong competitors, for example, KFC, Burger King, Pizza Hut etc. all competitors have good brand image, remarkable market share, long business history and so on. On this competitive situation, McDonald’s needs to consider its competitors power to ensure its dominating position.

Customers

McDonald’s is serving millions of customers daily. In last three months, McDonald’s served about 329 million people in UK (News Mirror, 22 Oct, 2010). In first world’s countries, all people are targeted as customers by McDonald’s. It serves foods for almost every kind of people. McDonald’s takes the customers as their first priority and tries to ensure maximum satisfaction.

The Public

The public includes the external groups who are interested and related with the company. McDonald’s works with considering the power and importance of different groups for instance, Media, central and local government, financial community, consumer group, pressure group and so on.

Intermediaries

As the business operation of fast food chain is different from other hospitality organisation like hotel or air lines or tour operators, the intermediaries are not required in this case. To promote the business, promotional activities are normally done by the company and every restaurant works as its distribution centre.

Power of suppliers

Suppliers’ power is another threat for business organisation. The company who is going to produce the product, it needs some necessary raw materials. As raw materials are normally delivered by suppliers, producing company depends on suppliers in this case. So, the nature of the relationship between company and suppliers affects the business. McDonald’s realizes this truth and practices friendly relationship with its suppliers.

Task 4

Assess the impact of the EU policies on McDonalds.

POLICY STATEMENT

The European division of McDonald’s has embarked on a pilot program to significantly improve the welfare of its suppliers’ farm animals and produce higher quality products. Seven suppliers (to be increased by six more this summer) provide amenities to their farm animals unheard of in the US.  (From the International Herald Tribune, June 20-21, 2009)

A Netherlands dairy farmer provides his 200 cows with water beds to increase their sleep time and blood flow. The animals also get weekly foot baths to reduce lameness. The farmer claims that happier cows live longer and produce more milk. About 95% of eggs used by McDonald’s in Europe are reportedly from non-caged birds, but a British supplier of free-range eggs went even further and planted trees in the fields around his hen houses to encourage them to spend more time outdoors. He believes this leads to better-feathered, healthier birds that lay more eggs. For more information about McDonald’s EU program,  . Since McDonald’s buys more than 200,000 tons of beef, 150,000 tons of milk and one million tons of potatoes in Europe each year, the chief supply officer of McDonald’s EU asserts that the flagship farms have the potential to change the entire industry and not just their own supply chain.

While McDonald’s EU Flagship Farm is forward-thinking and a significant advance in humane animal welfare, we wanted to see what McDonald’s is doing here in the US. We scoured its looking for stories about US cows sleeping on water beds and getting foot baths. We found none.   The few advancements in animal welfare noted on the website pale in comparison to the European programs. For example, McDonald’s now require US egg producers to use larger cages for their hens, but there is no mention of a cage free requirement as there is in Europe. McDonald’s has formed a USA Animal Welfare Council but the video available about the Council provides only general accolades about how great the Council is and does not refer to a single new policy adopted by the company to improve animal welfare.

GENERAL FACTS

Nowhere in the world does McDonald's use of beef threaten, or remotely involve, tropical rainforests. Food and beverage is provided for around 1.2 million people per day in the UK. Expenditure on food and non-food items in the UK in 1994 was £245 million. The 1994 expenditure on food in the UK was £220 million. McDonald's menu concentrates upon five main products: beef, chicken, bread, potatoes and milk which account for £151 million (69%) of all food expenditure. In 1994, McDonald's customers in the UK consumed: £45 million of beef, £28 million of chicken products, 42,000 tones of MacFries, 5.5 million gallons of milk and 335 million buns. In order to be able to supply the necessary quality and quantity of products, McDonald's suppliers have made substantial investments on the company's behalf. For instance, six new food factories have been opened over the last six years at a cost in excess of £33 million.

 

 

 

 

 

 

 

 

Task 5

Analyze the impact of global factor on business organization using McDonald as a case in point.

McDonalds is operating in all over the world in different environment in different laws, in different economy and in different social conditions. Law, economy and social condition are the very important consideration for McDonalds to operating in other countries. So, to find out the environmental factor that impacting upon McDonalds, PEST Analysis (Component of strategic management used in Political, Economical, Social, and technological analysis) is considered the best way to judge it.

Chart 1: PEST Analysis

Political factors:

Governments' relation with the country economy; more specifically with the freedom of doing business, government rules, regulation, and tendency of government to change the law etc. factors is known as political factors. Political factors include areas for government stability, press freedom, rule of law, corruption, regulation / deregulation trends social / employment legislation and likely political change.

If we analyze the McDonalds history we will find that McDonalds have to face several sues in different country in different times. For example case of Greenpeace, and royalty case in Malaysia. In 1999 when McDonalds established restaurant in French, they were protested against globalization of fast food. In 2001 Eric Schlosser's book "Fast Food Nation" criticized the business practices of McDonalds. He demanded that McDonalds used political influences to increase the business profit in different region of the world. When any law changes in any country McDonalds suit with the law and operate the business according to the law of that country

Economic factors:

Business Cycle Stage, growth, inflation, interest rate, unemployment, labor supply labor cost, disposable income, distribution all these topics are considered as economical factors. Interest rate of a country affects the cost of funding and inflation increase the product price, labor supply and labor cost also related with the product price.

McDonalds is the market leader in the world fast food market. So it has a very good idea how to handle inflation and change in interest rate. As a market leader it is a good advantage for McDonalds. It always seeks for highest revenue by reducing its cost of production. For example, gas price cost them 100% of their products so they transported it by gas guzzling trucks.

Purchasing power of the customer in different country also plays a major role for success in the fast food business. For example, in India there were 60 McDonalds restaurant in 2007. According to their purchasing power McDonalds produced low cost food that food they can afford easily. In Pakistan, neighbor of India, there are 25 restaurants in 2005. Most of the people are middle class they did not afford McDonalds food so they prefer local restaurants most of the time.

Product Pricing: McDonalds have some common menus that they serve all over the world. Some of them are: hamburger, chicken, French fries, soft drinks, coffee, salads etc. they also prepare some special menus according to the demand of the customers. For example: McLobster in New England and Canada. McHero sandwich are sold in different part of the USA. Price of these products is varied all over the world according to the currency value. Generally, McDonalds set their product price according to the cost of living of a country. In India McDonalds prepared food items with vegetable which is testy and easily affordable to the local people. In this way they capture worlds 19% food market.

Customer's first choice: In 2008 McDonalds made revenue $6.51 billion. The reason behind making this revenue is customer's first choice to McDonalds because McDonalds located in convenient places. As well as a global giant brand customer have faith on McDonalds. Reasonable price of the products is another reason of McDonald's success.

Shareholders Dividend: McDonalds is the world largest fast food chain shop. At any part of the world you will find McDonalds. Wherever they start business they follow aggressive sells strategy. They spend a lot for advertising, as a result their profit also increasing consistently. In 2008 McDonalds' revenue was $22.6 billion. In the last 25 consecutive years its dividend has increased in a consistent rate

Social Factor:

Population growth health, education, social mobility, employment patterns, attitude of Workers, Press, public opinion, attitude and lifestyle choices are included in social factors.

When McDonald's start their business in Saudi Arabia people was not very much habituated with fast food but they have gradually changed their lifestyle and accept fast food. As McDonald's offer Halal food in Saudi Arabia so the people especially young generation accept fast food very quickly. It also introduced a new item named McArabia which is prepared according to Islamic law.

McDonald's also related with some corporate social responsibility activity. For example in UK it provided fund for saving rainforest. The U.S. Environmental Protection Agency has certified McDonald's continuous effort to decrease solid waste by developing efficient packaging and by encouraging the use of recycled-content materials. Working within many social groups is the motto of McDonalds.

Assortment: Today McDonalds recognized as a global brand. So assortment is very necessary for McDonalds. McDonalds has its own brand name and value. People all over the world know about the quality and purity of McDonalds. So assortment of McDonalds is recognized as a asset. McDonald has 30,000 restaurants all over the world. If a new restaurant open anywhere of the world it will become successful for the symbol of McDonalds.

Attitude and life style: McDonald's has developed new food items that are healthier and it is a new slogan for McDonalds. Especially the people of generation X like McDonalds very much. After introducing fast food in different countries of the world younger people really love the menus of McDonalds and they enjoy it very much.

In some countries people thought that restaurants job is not a very lucrative job. When Jim Skinner, present CEO and Chairman joined in McDonalds he introduced a new slogan "Would you like a career with that?" outlining their jobs which have good prospects.

Public Opinion: Public opinion is a very important factor for McDonalds. Due to the difference of public opinion McDonald's food menus are different in every country. Response to the public pressure McDonalds added new food items in their menu. In UK due to the increasing demand of the provenance food McDonalds added milkshake and coffee to their food menu. Rainforest Alliance certified that McDonald's coffee is brewed form beans taken from stocks. McDonalds also introduced some traditional food items in different region of the world. For example chili garlic sauce in China. Not only that they also served some seasonal food items according to the demand of the customers. In India beef and pork is banned as a food items. Only Chickens is available as a food items. Due to the religious law meat and vegetable are prepared in different kitchen. Recently in India McDonalds have started to serve breakfast items named-Veggie McMuffin, hash browns, cuppa corn, Hot cakes with maple syrup, and Spinach and corn McMuffin. Not only in India or China but other countries where public opinion is important McDonalds considered it as an important factor.

Technological factors:

Impact of emerging technology, impact of internet, and reduced communication cost, R & D activity, impact of technology transfer are considered as technological factors.

McDonalds put emphasis on the R & D activities. For this reason Ray Kroc founder chairperson of McDonalds founded Hamburger University in the basement of a restaurant. This is the first university founded by a restaurant as a world training center for develop their staffs skill. Teach and train, quality service, cleanness, value to the staff and franchiser is the main target of this university. Now it is the center of excellence for McDonald's leadership and training development. When a franchisee open McDonald restaurant anywhere of the world they need to take training form this university. To ensure quality, service, value and cleanness is the main target of the University.

Technology helps McDonalds to ensure higher service to its customers. McDonalds use customized software to maintain customers' database. In Hamburger they get training to use the software.

Environment:

Weather conditions, atmosphere, and environmental change that affect industries are known as Environmental factors. McDonalds is a food industry so for it high quality packing is the key factor of serving quality food products. McDonalds franchise use McDonald ingredients which help to keep the food world class standard and more fresh.

In UK & USA McDonalds give priority to keep the restaurants environment friendly. They took initiative to reduce carbon in there restaurants, use environment friendly element for serving food items.

After completing PEST Analysis I find that McDonald's operation is greatly influenced by its political, economical, social and technological factors. Among these factors I think social factors are greatly influenced the operation of McDonalds. So McDonalds should give priority towards the social condition of the society.

McDonalds made their business plan to win. Most important to them is to incorporate customer desire in their product so that customer can trust on McDonald's brand. It passed on this philosophy McDonalds made SOWT analysis, formulate there current strategies. Below the strategies are evaluated by find out its advantages and disadvantages:

SOWT Strategies

SO Strategies

Expand into Chinese Market (Increasing Advertising and restaurant locations)- Market Development:

Advantage:

Everyday Chinese food market is increasing its size. Population is increasing every year. Population growth rate in China is 16%. Social shopping places increase 6% yearly. So for McDonalds it is a great opportunity to expand market in China. Invest in Chinese food market will be very good for them in future.

Chinese consider drive through's a novelty where car ownership is growing rapidly. It is a good sign for McDonalds because McDonalds like to establish there restaurants in the side of road or in busy places.

In December 2007 McDonalds has 660 restaurants in China. So McDonalds has already recognized as a super brand all over China. Due to increasing the population and social places food market will increase so demand of the good food restaurant will increase. If McDonalds expand their market in China people will welcome them.

McDonald generally follow aggressive sells strategies around the world. For these reasons they spend huge amount of money in advertisement. As well as McDonalds also participate in social responsible activities.

McDonalds expand their operation in China. So they should set its restaurants in such locations from where they easily serve their customer.

Disadvantage:

Yum Brands is the leading food restaurants in China. In 2008 the restaurants made $469 million profit and established 550 restaurants in China. KFC is another main competitor in China. It has 2700 restaurants in China. So McDonalds have to dace great completions in China if they want to be successful in China.

McDonalds increase its restaurants through franchisee. So sometime it is difficult for them to control their basic philosophy- quality, value, cleanness, service.

Yum brand is the main quick service provider in China. If McDonalds want to take their place they have to analysis the Chinese market very carefully and established there location in such places where they can easily provide services to their customers.

Without any doubt it can be said that expanding in Chinese market is a good strategy for McDonalds. So they should quickly expand in there market operation in China. If they follow aggressive marketing strategy it will be good for them to make success in Chinese market.

Acquiring Krispy Kreme Corporation-Horizontal Integration

Krispy Kreme is known as a chain of doughnut stores. Its father company is Krispy Kreme Doughnuts, Inc. which is located in Winston-Salem, North Carolina, United States. Krispy Kreme opened stores outside the southeastern United States to begin another phase of its expansion in the 1990s. In December 2001, Krispy Kreme started its operation outside the U.S. in Canada, Mississauga and Ontario. Since 2004, Krispy Kreme has expanded its operation in international market. It is in the verge of bankrupt in China. McDonalds in china integrated horizontally with it.

Advantages of the strategy:

It will be easy for McDonalds to get the Krispy Kreme customers to divert towards the McDonalds.

McDonalds will not need any extra cost to established restaurants they can easily use the infrastructure of Krispy Kreme.

Krispy Kreme Corporation is at the edge of bankruptcy; McDonalds will easily integrate the company without showing any hostility towards the acquiring the company.

McDonalds will easily get the customers of Krispy Kreme.

Horizontal integration with Krispy Kreme will less the competition in the food industry. McDonalds will get the competitive advantage by this decision.

Disadvantages of the strategy:

The customers of the Krispy Kreme may not be interested in this integration. They can take their position against this integration. Not only this, McDonalds expect that Krispy Kreme customers will diversify to McDonalds. This may not be happen. Then it will not be a good decision.

Share holders of McDonalds may not welcome the decision. So the share price of the MDC will fall.

It will difficult for McDonalds to operate the business with Krispy Kreme employees. So McDonalds need to deploy new employee to operate business in Krispy Krem

restaurants. To get a lot of trained employee at a time is difficult. So McDonalds have to think about it.

These are the advantages and disadvantages McDonalds should be considered before going to integrate horizontally with the Krispy Kreme.

WO Strategies

Menu development (Healthy lifestyle & Hispanic foods lines) - Product Development

Menu development according to the lifestyle and traditionally recognized menu is a good strategy. Like its competitors today McDonalds develop their menus with the traditional items. In below I described the advantages and disadvantages of the strategy:

Advantages:

Today people are more conscious about their health. They try to avoid oily and spice food items. They basically prefer food items which has low fat and less oil. So McDonalds develop "Healthy lifestyle" program to attract the health conscious consumers.

McDonalds put emphasis on the Hispanic population. The reasons are that in US Hispanic population increased by 14 percent. They forced McDonald's to spotlight to this group. McDonalds should create new food line to attract these customers. These people are the new base customer of McDonalds.

There is a rumor that fast food is very unhealthy. But McDonalds try to create new concept by developing a "healthy lifestyle" programs. That attracts new health conscious customers. By serving more healthy food, McDonald's may be able to change this idea which may be a competitive advantage for McDonald's.

Disadvantages:

To get success in this strategy McDonald's had to spend more for develop new products. So they need to spend more on the research & Development activities.

New generation of the Hispanic population are the new customer of McDonalds may not be attracted. So McDonalds develop some new strategies to attract them.

McDonalds should put more emphasis on this strategy. This strategy has good future and more potentially that will make them successful in the Hispanic food lines and new life style.

ST Strategies

Increase the number of restaurants located in theme parks (Disney and Ocean parks)- Forward integration:

McDonalds take this strategy by analyzing its strength and threats. In below I described the advantages and disadvantages of McDonalds.

Advantages:

McDonalds has already some restaurants in them parks like Disney and Ocean Parks so, they have very good idea about the business in theme parks and social places. As well as every year new theme parks and market increased by 6%. So it is a good opportunity for them to establish and expand business in theme parks and shopping mall. They can also provide good and quick service to their customers.

Brand value of the McDonalds also helps them to establish the business in the theme parks and social places. Brand value of the McDonalds also makes them popular towards the consumers of the McDonalds. It will be an exposure of McDonald's brand name and reputation.

Disadvantages:

Establishing new restaurant means face new challenges to maintain their standards. McDonald's basic philosophy, quality, service, cleanness will face a good challenge.

Yum Brands and KFC also in the process of starting business in the social places. So McDonalds have to faces challenges to be success in the theme parks.

More restaurants mean more advertising so they need to increase their advertising cost.

Conclusion

McDonald's is one of the largest fast food companies in the world. They continue their path for success by keeping their consumers in mind regarding their product selection as well as their prices. They encourage their employees to do a good job, usually promotes from within, and offers several scholarships to encourage education. Though McDonald's is a centralized, "wait and see" company they find ways to use technological products that will increase their productivity, service, and sales, everywhere from using the Nintendo DS to train staff to using New POS touch screen registers. McDonald's will certainly be around for plenty more years to come.

When it comes to the environment, McDonald’s irresponsibility toward the effects of their business practices is highly evident. These effects counter their recent efforts at cultivating a "green" image. However, they remain almost hidden behind that glossy green picture of McDonald’s. Once uncovered, it is apparent that McDonald’s is not such a friendly neighbour to the environment. They pride themselves on leading the industry in environmental protection, when it seems they do more harm than damage. The beef they use to feed America comes from cattle that graze on ex-rainforest land. The packaging that beef is wrapped in to be given to the consumer is used for mere minutes before being thrown away, many times landing back on the ground, polluting the environment. And as the success of this giant food chain increases, so does the size of America's giant waistline. The easily accessible, cheap, and masterfully marketed products that McDonald's sells is food sky-high in fat and cholesterol and essentially void of nutrients. The greasy burgers, salty fries, and soda have contributed to America's ever-growing struggle with obesity. Never far from sight, fast food establishments such as McDonald's have made their eating a kind of necessary and inevitable evil as we rush from home to jobs, school, sports practice, and everything else that crowds our busy lives. Does fast food simply supply a demand created by our break-neck worlds? Or has it actually altered our perception of food, time, and quality? It is near-impossible to imagine an America without these highway rest stops, airport kiosks, and after school treats. Similarly, with the exportation and spread of America, it is becoming increasingly difficult to imagine a world without fast food.