SWOT Analysis on McDonald’s::

Strength::

• McDonalds has built up huge brand equity. It is the No. 1 fast-food company
by sales, with more than 31,000 restaurants serving burgers and fries in
almost 120 countries. Sales, 2007 (11,4009 million), 5.6% sales growth.
• Globalization: 31,000 restaurants serving 120 countries. Of the 31,000
restaurants at least14,000 restaurants in the US
• Good innovation and product development. It continually innovates to retain
customers in the business.
• The McDonalds brand offers consumers choice, reasonable value and great
service
• Large amounts of investment have gone into supporting its franchise network,
75% of stores are franchises
• Loyal staff and strong management team.
• Very strong brand name
• Recognizable characters
• Large target group
• New stores almost 100% guaranteed to succeed
• Ability to adapt when faced with criticism
• Play Area for children
• successful advertisement (i’m loving it)

• Great partnership(coke cola)

• clean environment and play ground for kids

• professional training for employees(hamburger university)

• mcdonalds is able to generate more sales because of its brand recognition

• Active Childrens Charity: The Ronald McDonald House

• Adjusted Ingredients and product offerings to comply with upgraded health
standards deemed necessary by the USDA
• Earns revenue not merely by fast food sales, but also as a property investor,
a franchiser of restaurants.
 • Branded (name recognized) menu items such as Big Mac, Quarter Pounder
and Chicken McNuggets
• Strong brand name, image and reputation.
• Large market share.
• Strong global presence.
• Specialized training for managers known as the Hamburger University.
• McDonalds Plan to win focuses on people, products, place, price and
promotion.
• Strong financial performance and position.
• Introduction of new products.
• Customer focus (centric).
• Strong MCD's performance in the global marketplace.
Weakness:::

• Many other similar competitors

• Until recently, had very few options for eating healthy
• Negative image due to “Fast Food Nation” and other media sources
• Advertisement techniques that target children
• Consumers use disposable income to purchase fast food meals so when the
budget it treatened, consumers redirect these funds
• Public perception: McDonalds has been impacted by negative press like the
documentary "Supersize Me" by Morgan Spurlock in which he contributed our
societies obesity to McDonalds and other fast food chains.
• product development

• price

• management of franchisees/joint venture

• Core product line out of line with the trend towards healthier lifestyles for
adults and children. Product line heavily focused towards hot food and
burgers[3].
• Seasonal
• Quality issues across the franchise network.
• Unhealthy food image.
• High Staff Turnover including management
• Customer losses due to fierce competition.
• Legal actions related to health issues; use of trans fat & beef oil.
• Uses HCFC-22 to make polystyrene that is contributing to ozone depletion.
• Ignoring breakfast from the menu.

Opportunities::
• “Going green” – energy management, improving packaging efficiency,
environmentally friendly refrigerants, and partnering with Greenpeace for
rainforest protection
• New store looks/styles – McCafe coffee shop, and “forever young” redesign
• Charity – The Ronald McDonald House provides a cheap or free place to stay
for parents of sick children. Over 250 worldwide in 48 countries. Funded
primarily by donations and Joan Kroc (founder Ray Kroc’s wife)
• Innovation: Continued adaptation to societies needs such as USDA and
Supersize Me upgrade.
• Conservation: Researching green energies and green packaging solutions and
incorporating these findings as a part of their marketing strategy and
advertisements.
• Exploration: Create new product offerings. Continue to use technology to
influence revenue strategy: possibly use text messages to deliver specials
offers to individuals who sign up for such services.
• internationalization

• growing dinning-out market(especially for young generations and middle age

group)

• Joint ventures with retailers (e.g. supermarkets).

• Consolidation of retailers likely, so better locations for franchisees.
• Respond to social changes - by innovation within healthier lifestyle foods. Its
move into hot baguettes and healthier snacks (fruit) has supported its new
positioning.
• Use of CRM, database marketing to more accurately market to its consumer
target groups. It could identify likely customers (based on modelling and
profiles of shoppers) and prevent brand switching[4].
• Strengthen its value proposition and offering, to encourage customers who
visit coffee shops into McDonalds.
• The new “formats”, McCafe, having Wifi internet links should help in attracting
segments. Also installing children’s play-parks and its focus on educating
consumers about health, fitness.
• Continued focus on corporate social responsibility, reducing the impact on the
environment and community linkages.
• International expansion into emerging markets of China and India.
• Growing health trends among consumers.
• Globalization, expansion in other countries (especially in China & India).
• Diversification and acquisition of other quick-service restaurants.
• Growth of the fast-food industry.
• Worldwide deregulation.
• Low cost menu that will attract the customers.
• Freebies and discounts.

Threats::

• Current world economic standing: the company's revenue streams are

diversified, but depending on the the length of this "recession", they will
inevitably be negatively impacted by the trickle down effect.
 • More Casual Dining Restaurants increasing their "burger" offering and
decreasing the price: Restaurants like Ruby Tuesdays have $6 burger
meals that they strongly advertise…If you're not in a hurry, which one
would you choose?
• Public Health Crisis: with a growing number of obesity cases among
Americans, fastfood chains like McDonalds will continued to be
overshadowed by their previous product offerings (Supersized Meal, no
fruits or yogurt, slim salad selection).
• Health professionals and consumer activists accuse McDonald's of
contributing to the country’s health issue of high cholesterol, heart
attacks, diabetes, and obesity.
• The relationship between corporate level McDonald's and its franchise
dealers.
• McDonald’s competitors threatened market share of the company both
• internationally and domestically.
• Social changes - Government, consumer groups encouraging balanced
meals, 5 a day fruit and vegetables.
• Focus by consumers on nutrition and healthier lifestyles.
• Competitive pressures on the high street as new entrants offering value
and greater product ranges and healthier lifestyles products. E.g. subway,
supermarkets, M&S.
• Recession or down turn in economy may affect the retailer sales, as
household budgets tighten reducing spend and number of visitors.
• Pressure groups - environmental
• more health conscious customers

• threats from local compietitors from different countries

• the economic downturn

• playing in a mature and saturated industry

• foreign currency fluctuations is another problem for global companies like

mcdoanlds

• fast food industry is becoming an increasingly competitive sector

Strategy Of McDonald’s

THE 7 P's Of Mc DONALDS' Strategic Approach:

PRODUCT:

Mc Donald’s product portfolio primarily comprises of vegetarian and non-

vegetarian burgers. The vegetarian burgers like Veg surprise, salad sandwich, Mc
Aloo Tikki Burger, Mc veggie burger are offered to the customers. Non-vegetatarian
burgers include Chicken Mc grill, Mc chicken burger, Fliet of fish and chicken
maharaja burger. Along with these french-fries, veg pizza mc puff, wrap chicken
Mexican, wrap paneer salsa, potato wedges, soft serve pineapple and choclate ice
creams, Mc swirl soft drinks, coffee and Mc shakes are also offered to increase the
variety in the product portfolio. Mc Donalds also provides mean combos with medium
fries and medium soft drink, happy mean with small soft drink, econo meals with
small soft drink and value meals with potato wedges and small soft drink.

PRICE:

Mc Donalds vegetarian burgers are priced between Rs 20 and Rs 48. Wrap paneer
salsa is priced at Rs 45-50. The non vegetarian burgers are priced between Rs 30
and Rs 60. Wrap chicken Mexican is priced at Rs 55. Medium French fries are priced
at Rs 28, potato wedges at Rs 20, soft serves at Rs 35, mc swirl at Rs 12, medium
soft drinks at Rs 20 and medium shakes at Rs 45.

PROMOTION:

At Mc Donalds the prime focus is on targeting children. In happy meals too which are
targeted at children small toys are given along with the meal. Apart from this,
various schemes for winning prices by way of lucky draws and also scratch cards are
given when an order is placed on the various mean combos. In fact, the various
econo meals and value meals also signal to the customer that buying separate items
results in greater value for money for the customer.

PLACE:

Mc Donals’ outlets are very evenly spread throughout the NCR region. Mc
Donalds does not offer home delivery but its outlets are very readily accessible. Mc
Donalds also offers take away drive through facilities.

PEOPLE:

The employees in Mc Donalds have a standard uniform and Mc Donalds specially

focuses on friendly and prompt service to its customers from their employees.

PROCESS:

The food manufacturing process at Mc Donalds is completely transparent i.e. the

whole process is visible to the customers. In fact, the fast food joint allows its
customers to view and judge the hygienic standards at Mc Donalds by allowing them
to enter the area where the process takes place. The customers are invited to check
the ingredients used in food.

PHYSICAL EVIDENCE:

Mc Donalds focuses on clean and hygienic interiors of is outlets and at the same time
the interiors are attractive and the fast food joint maintains a proper decorum at its
joints.
The Main Objectives of McDonald’s Business are: -
Sales – Sales revenue is the total amount of money a company has earned by
providing their service or selling their stock.
Growth – An increase in the Business capacity to produce more stock or provide
better or greater service.

Profit – Residual value gained from business operations after cutting out
expenses such as stock cost etc.
Customer

Satisfaction – Providing service to customers to their satisfaction level such as

hygienically clean place or high quality food.

SMART
Before a business can set objectives it is important that they follow the SMART
criteria.
•Specific
– Detailed and Exact
•Measurable
– Targets should be measurable
•Achievable
– Something that can be achieved
•Realistic
– Targets must be realistic, so that they can be met
• Time Specific
– That can be achieved by a deadline

“
It’s What I Eat And What I Do…I’m Lovin’ It ”

PLAN
– Their plan is to deepen their connection with the customer by
providing great service ad experience “in every restaurant, every
time.” Their usage of different activities allows McDonald’s and the
Customers to have a relation between them.
Goods And Service Design::
Strategies
a) Advertisement: McDonalds implements this strategy by making aware
people about their products and services through advertising on TV,
newspapers, brochure.
b) Customers Relationship: The personals of customer relationship
department convince the people and customers about services.
Results
1. Inside the McDonalds:
a) Achieving Objectives: By implementing this strategy McDonalds is
achieving its objectives, i.e. it’s earns profit, customers are satisfying, and
the services offered to customers sharing in revenue growth of the
country. So it helps to make further plans, strategies, making strengths,
expansion of franchises etc.
b) Business Development: As customers become attractive therefore
McDonalds opens new branches. So it helps in expansion of business.
2. Outside the Organization:
Improving social life: These strategies are improving quality of life as well
as the social and environmental awareness in general public.

Location Selection:
Strategies
McDonalds makes and implement its location strategy in following way: -
Business Areas: They open their branches in business areas where they
target the corporate people and the working class to dine in and have
their timeout for breakfast and lunch.
Play Lands and Shopping Areas: They try to introduce their services
according to target customers, i.e. capture the customers in the
amusement parks and in markets such as the branch in Fortress
Stadium, Model Town link road etc.
Results
Convenience: Customers feel comfort ability when a branch is in near
vicinity to their work place.
Customer Gaining: Due to the good environment the company has an
ability to gain their customers to their locations.

Layout Design::

Strategies
a) Exterior: McDonalds sets its premises in proper manner to handle any
number of customers easily. The building design is standard world wide
but it may be have some difference in size or in exterior according to the
location. It enables them to save time, satisfy their customers,
comfortable environment for both employees and customers.
b) Interior: McDonalds uses the same interior pattern as it’s used
internationally. It may vary according to the premises size.
Results
a) Brand Recognition: Homogeneity in layout design and franchise settings
strikes a clear brand image in the minds of the customers. The efficiency
level of personnel also leaves a good impression on the minds.
b) Customer Satisfaction: Through a universal image, layout design and
the brand image in the minds of customers results in customer
satisfaction.
Human Resource
Being partially in pure services and goods production sector,
McDonalds exercises a good strategy for its human resources e.g.
Right Person on Right Job: McDonalds allocates its human resource in
different areas according to the abilities, qualifications and experiences
of employees. They appoint a marketing expert for marketing,
accountant for accounts etc.
Trainings: McDonalds provide training opportunities for its employees
who need training in a particular area. So it enables the
organization to achieve its goals efficiently.
Separate Departments for Different Functions: McDonalds has
different departments for different functions. Marketing department
consists of marketing experts who perform marketing analysis and
finance department consists of finance experts who arrange and manage
finance etc.
Proper Utilization of Resources: As there are many experts in different
areas, so they use all available resources and opportunities properly. They
provide services to their customers efficiently, which satisfies
customers and they achieve their goals successfully.
Employee’s Job Satisfaction: McDonalds provides training
opportunities to its employees to improve their skills. So it results in
enhanced employee performance and they become more interested to
work in good manner, which gives a good reputation to the
organization.
Competency: McDonalds trains it’s employees of all departments to
enhance their capabilities and to improve their skills and therefore
employees provide right product to right customers on right time. So
it enables the organization to compete in the market.
 Observation:

Local Sourcing Is Key for Truly Indian Products:

McDonald's India is committed to sourcing almost all of its products from within the
country. For this purpose, it has developed local Indian businesses, which can supply
them the highest quality products required for their Indian operations. Fresh Lettuce
is sourced from Pune, Delhi, Nainital and Ooty; Cheese from Dynamix Dairies,
Baramati, Maharashtra; fresh Buns from Mrs. Bector Foods, Phillaur, Punjab &
Khopoli, Maharashtra; Sauce from Mrs. Bector Foods, Phillaur, Punjab, Chicken
Patties, Vegetable Patties, and Veg.Pizza McPuff from Vista Processed Foods, Taloja,
Maharashtra. Dairy Products are sourced from Amrit Food, Ghaziabad, UP. All our
suppliers are HACCP certified.

Respect for the Indian Customs and Culture:

McDonald's worldwide is well known for the high degree of respect to the local
culture. McDonald's has developed a menu especially for India with vegetarian
selections to suit Indian tastes and culture. In line with its respect for local culture,
India is the first country in the world where McDonald’s does not offer any beef or
pork items. McDonald's has also re-engineered its operations to address the special
requirements of vegetarians. Special care is taken to ensure that the vegetable
products are prepared separately, using dedicated equipment and utensils. This
separation of vegetarian and non-vegetarian food products is maintained throughout
the various stages of procurement, cooking and serving. So much so that the
mayonnaise and the soft serve are also 100% vegetarian. Also in India, only
vegetable oil is used as a cooking medium.

An Employer of Opportunity:
McDonald's India is an employer of opportunity, providing quality employment and
long-term careers to the Indian people. The average McDonald's restaurant employs
60-80 people from crew to restaurant manager. McDonald's world class-training
inputs to its employees can be seen in the present close to 4000 employees
currently in India.
Quality, Service, Cleanliness & Value
The USP of McDonald’s is Quality, Service, Cleanliness & Value for money which
means we focus on providing our customers high quality products, served quickly
with a smile, in a clean and pleasant environment at an affordable price. The
McDonald's philosophy of QSC&V is the guiding force behind its service to the
customers. McDonald’s menu is priced at a value that the largest segment of the
Indian consumers can afford. McDonald’s does not sacrifice quality for value – rather
McDonald’s leverages economies to minimise costs while maximizing value to
customers.
Community Partnership
McDonald's believes in giving back to the community it serves. Wherever McDonald's
goes, it becomes a part of the community it operates in and contributes towards the
development of the locality. For example, McDonald's has introduced the concept of
‘Litter Patrols’ – McDonald's employees go around the market every day, picking
up garbage left behind not only by customers from McDonald's restaurants but also
by other visitors in the area. The result is a cleaner neighbourhood.

Motivation:
People are the most important resources of an organisation. They ensure the
interaction of financial, industrial, and other resources so that the organisation
can function. Nowadays experienced managers realize that he financial reward
cannot stay the only kind of an employee encouragement. The employees' needs
should be viewed as an entity that leads to the search of non financial motives.
There exist many non financial motives that are connected with the employee's
satisfaction of needs, such as his/her recognition, participation in the decision-
making, self-fulfillment, personal growth and others.

The practice shows that the full use of human resources of an organisation is one
of the most significant advantages, which allow companies to occupy the leading
positions in the world market. The 'McDonalds' company flourishes owing to the
logical integration of the staff into the problem solving. The company adheres to
the principle: 'The result is done by a man'. 'McDonalds' examines its employees
as the primary source of progress in the field of quality and productivity. This
organisation has based its success on the motivation theories having altered only
some aspects of them. 'McDonalds' adheres to four simple principles, which give
the possibility to increase the performance of its employees:

1. The company must elaborate different systems of motivation for every

department.

2. The personnel must have clear and attainable aims. It is better to have one
aim per a person.

3. The aims must change: managers should have one aim for half of a year. For
example, at first a manager examines the number of clients, then he/she
examines the number of returning clients; and then he/she should analyze the
increase in business sales. This method gives the possibility to find new abilities
of employees and to check new methods of work.

4. The rise of salary amount must be sensible for an employee.

The 'McDonalds' company applies three components of the motivation system:

financial encouragement, non financial encouragement, and social policy.
The research of the 'McDonalds' company, its strategy and structure shows that only
a simultaneous fulfilment of employee's needs will increase an employee's
performance

Summarising, the 'McDonalds' company has effective motivation system that

makes it possible to increase employees' performance, and hence the company's
productivity. The situational approach applied by 'McDonalds' administration staff
has turned out to be the most relevant to the current situation. The
administrators have used the specific techniques on the basis of motivation
theories. Having applied the procedure of assembly line in food preparation,
'McDonalds' has ensured the standard quality of the production and the high
 performance. Besides, the company has implemented effective motivation
strategy that is based on the existing motivation theories. Consequently, on the
basis of the research we can say that every company has its own system of
behaviour explanation and every concrete case should be examined as the
'McDonalds' company case.

Recommendations

• The introduction of the Salads Plus menu. This is now a permanent feature on
the McDonalds menu, which brings a healthier, lighter focus to the original
menu, consisting of a range of products that have 10 grams of fat or less, per
serve.
• Introducing nutrition information panels on the packaging of regular menu
items. This allows for enhanced consumer information and education,
enabling individuals and families to make better dietary choices.
• Introducing hamburger buns that are low in sugar.
• Reducing the calorie / kilojoule (energy) and sugar content of Salads Plus
muffin and yoghurt menu items.
• Launching an alternative (healthier) Happy Meal for children, containing fruit
and vegetables.
• Using a liquid canola cooking oil blend in restaurants, to aim for enhanced
cooking methods.
• Introducing a new breakfast menu known as “Quickstart”. McDonald’s have
teamed up with some of Australia’s favourite brands to launch this new menu,
which offers cereals, fruit, yoghurt and juices.

McDonald’s has made available super-size portions, advertised as offering good value
for money. In response to the obesity epidemic sweeping the country, as well as the
poor nutrition these super-size portions offer, McDonald’s has decided to phase out
its super-size French fries and soft drinks later this year. This move is another one of
McDonald’s steps to appeal to health- and weight-conscious consumers.

 McDonald’s needs to be aware of the situation and design jobs

keeping in mind numbers of factors which affect the performance in
work place.

 McDonald’s don’t only need to motivate individuals. They should

provide them with an environment to be self motivated.

 The company should take necessary actions to cure the problem of

stress by making job more interesting.

 Effective communication of all kinds is crucial to the success of every

organization. (Mc Donald’s)

Conclusion and Suggestions:

Suggestions
In the end of our report we have following suggestions:
• McDonalds should revise its product prices.
• Company should work on all of its products
• There is still a lot of opportunities for McDonalds to increase number of
outlets

After the analysis of our project we have concluded our report as under:
• McDonalds is maintaining its product quality according to the international
standards
• The customization of the product and services according to the culture of
has resulted in customer satisfaction
• McDonalds has properly covered the business areas with in cities e.g. Lahore
• McDonalds maintains a good environment in every premise.
• McDonalds has a learning environment for employee development
and customer satisfaction.