Supply Chain Management

A Project On

“Mc Donalds”
 ACKNOWLEDGEMENT

This Supply Chain Management project on McDonalds is the outcome of sincere and
positive contribution of various individuals. We can not justifiably translate there help, cooperation
and guidance extended to us in completing this project work in words. However we shall be failing
in our duty if we don’t express our thanks to a few people in particular.
We would like to thank Mr. Akhilesh Mishra(floor manager) at McDonalds for his cooperation
and it has been high privilege to work under the able supervision of our respected teacher,
prof. Rita Chatterji
 Table of Contents

1. Introduction to McDonalds.

1.1 History.

1.2 Corporate overview.

1.3 Why the Project?

1.4 Types of Restaurants.

2. Methodology used.

3. Business model.

4. Advertising.
 5. Global operations and locations.

6. McDonalds in India.

7. Understanding Supply Chain Management.

8. Inventory Management.

9. How Purchasing cycle works?

10. Understanding Supply Chain at McDonalds.

11. Suppliers and Distributors of McDonalds.

12. findings of study conducted.

McDonald's

Is the leading global foodservice retailer with more than 30,000 local restaurants serving 52 million people in more than 100 countries
each day. More than 70% of McDonald's restaurants worldwide are owned and operated by independent local men and women
 History

1957 Quality, Service, Cleanliness and Value (QSC& V) becomes the company motto.
1959 The 100th McDonald's opens in Chicago.
1961 Hamburger University opens in Elk Grove, near Chicago.
1963 One billion hamburgers sold.
Ronald McDonald makes his debut.
1964 Filet-O-Fish sandwich is introduced.
1965 McDonald's Corporation goes public.
1967 The first restaurants outside of the USA open in Canada and Puerto Rico.
1968 The Big Mac is introduced.
The 1,000th restaurant opens in Des Plaines, Illinois.
1972 A new McDonald's restaurant opens every day.
The Quarter Pounder is introduced.
1973 Egg McMuffin is introduced.
1974 The first Ronald McDonald House opens in Philadelphia.
The Happy Meal is launched.
1983 Chicken McNuggets is introduced.
New Hamburger University campus opens in Oak Brook, Illinois. Set in 80 wooded acres. Training is provided for every level of
McDonald's management worldwide.
50 billionth hamburger sold.
1984 Ronald McDonald Children's Charities is founded in Ray Kroc’s memory to raise funds in support of child welfare.
1989 McDonald's is listed on the Frankfurt, Munich, Paris and Tokyo stock exchanges.
1990 McDonald's opens in Pushkin Square and Gorky Street, Moscow.
1993 The first McDonald's at sea opens aboard the Silja Europa, the world's largest ferry sailing between Stockholm and Helsinki.
1994 Restaurants open in Bahrain, Bulgaria, Egypt, Kuwait, Latvia, Oman, New Caledonia, Trinidad and United Arab Emirates,
bringing the total to over 15,000 in 79 countries on 6 continents.
1996 McDonald's opens in India – the 95th country.

The business began in 1940, with a restaurant opened by siblings Dick and Mac McDonald in San Bernardino, California. Their
introduction of the "Speedee Service System" in 1948 established the principles of the modern fast-food restaurant. The present
corporation dates its founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois on April 15, 1955, the
ninth McDonald's restaurant overall. Kroc later purchased the McDonald brothers' equity in the company and led its worldwide
expansion.

With the successful expansion of McDonald's into many international markets, the company has become a symbol of globalization
and the spread of the American way of life. Its prominence has also made it a frequent topic of public debates about obesity, corporate
ethics and consumer responsibility.

Corporate overview

Facts and figures

A McDonald's restaurant in Times Square.

McDonald's restaurants are found in 120 countries and territories around the world and serve nearly 54 million customers each day.
The company also operates other restaurant brands, such as Piles Café, and has a minority stake in Pret a Manger. The company
owned a majority stake in Chipotle Mexican Grill until completing its divestment in October 2006. Until December 2003, it also
owned Donatos Pizza. On August 27, 2007, McDonald's sold Boston Market to Sun Capital Partners. It also has a subsidiary, Redbox,
which started in 2003 as 18-foot (5.5 m) wide automated convenience stores, but as of 2005, has focused on DVD rental machines.

WHY THE PROJECT

• To strengthen our knowledge

• To develop practical approach
• To understand real supply chain practices
• To know the cold chain system
Methodology Used

• Through Questioners
• Personal interviews
Types of restaurants
A McDonald's restaurant in Kristiansand, Norway.

Inside a Dublin McCafé.

Most standalone McDonald's restaurants offer both counter service and drive-through service, with indoor and sometimes outdoor
seating. Drive-Thru, Auto-Mac, Pay and Drive, or McDrive as it is known in many countries, often has separate stations for placing,
paying for, and picking up orders, though the latter two steps are frequently combined; it was first introduced in Arizona in 1975,
following the lead of other fast-food chains. In some countries "McDrive" locations near highways offer no counter service or seating.
In contrast, locations in high-density city neighborhoods often omit drive-through service. There are also a few locations, located
mostly in downtown districts, that offer Walk-Thru service in place of Drive-Thru.Specially themed restaurants also exist, such as the
"Solid Gold McDonald's," a 1950s rock-and-roll themed restaurant. In Victoria, British Columbia, there is also a McDonald's with a
24 carat (100%) gold chandelier and similar light fixtures.
The site of the first McDonald's to be franchised by Ray Kroc is now a museum in Des Plaines, Illinois. The building is a replica of the
original, which was the ninth McDonald's restaurant opened.To accommodate the current trend for high quality coffee and the
popularity of coffee shops in general, McDonald's introduced McCafés. The McCafé concept is a café-style accompaniment to
McDonald's restaurants. McCafé is a concept of McDonald's Australia, starting with Melbourne in 1993. Today, most McDonald's in
Australia have McCafés located within the existing McDonald's restaurant. In Tasmania there are McCafés in every store, with the rest
of the states quickly following suite. After upgrading to the new McCafe look and feel, some Australian stores have noticed up to a
60% increase in sales.As of the end of 2003 there were over 600 McCafés worldwide.

Some locations are connected to BP gas stations/convenience stores, while others called McDonald's Express have limited seating
and/or menu or may be located in a shopping mall. Other McDonald's are located in Wal-Mart stores. McStop is a location targeted at
truckers and travelers which may have services found at truck stops.

Playgrounds

Some McDonald's in suburban areas and certain cities feature large indoor or outdoor playgrounds, called "McDonald's PlayPlace" (if
indoors) or "Playland" (outdoors. The first PlayPlace with the familiar crawl-tube design with ball pits and slides was introduced in
1987 in the USA, with many more being constructed soon after. Some PlayPlace playgrounds have been renovated into "R Gym"
areas."R Gyms" are in-restaurant play area that features interactive game zones designed for children aged 4 to 12. Equipped with
stationary bicycles attached to video games, dance pads, basketball hoops, monkey bars, an obstacle course, and other games which
emphasize physical activity. The "R Gym" features the Toddler Zone, an active play environment with age appropriate games that
develop physical coordination and social skills; the Active Zone, designed for children aged four-to-eight that promotes physical
fitness through fun play; the Sports Zone which features a series of sport oriented activities to promote aerobic exercise for children
aged 9-to-12; the Parent Zone which features seating and provides a monitoring area for their children; and the Dining Area which
allows families to eat.

Redesign

In 2006, McDonald's introduced its "Forever Young" brand by redesigning all of their restaurants, the first major redesign since the
1970s. The new design will include the traditional McDonald's yellow and red colors, but the red will be muted to terra cotta, the
yellow will turn golden for a more "sunny" look, and olive and sage green will be added. To warm up their look, the restaurants will
have less plastic and more brick and wood, with modern hanging lights to produce a softer glow. Contemporary art or framed
photographs will hang on the walls.The exterior will have golden awnings and a "swish brow" instead of the traditional double-slanted
mansard roof.

The new restaurants will feature areas:

• The "linger" zone will offer armchairs, sofas, and Wi-Fi connections.

• The "grab and go" zone will feature tall counters with bar stools for customers who eat alone; Plasma TVs will offer them
news and weather reports.

• The "flexible" zone will be targeted toward families and will have booths featuring fabric cushions with colorful patterns and
flexible seating.

Different music will be targeted to each zone.

Business model

The McDonald's Corporation's business model is slightly different from that of most other fast-food chains. In addition to ordinary
franchise fees, supplies, and percentage of sales, McDonald's also collects rent, partially linked to sales. As a condition of the
franchise agreement, the Corporation owns the properties on which most McDonald's franchises are located. The UK business model
is different, in that fewer than 30% of restaurants are franchised, with the majority under the ownership of the company. McDonald's
trains its franchisees and others at Hamburger University in Oak Brook, Illinois.According to Fast Food Nation by Eric Schlosser
(2001), nearly one in eight workers in the U.S. have at some time been employed by McDonald's. (According to a news piece on Fox
News this figure is one in ten). The book also states that McDonald's is the largest private operator of playgrounds in the U.S., as well
as the single largest purchaser of beef, pork, potatoes, and apples. The selection of meats McDonald's uses varies with the culture of
the host country.

Products

McDonald's predominantly sells hamburgers, various types of chicken sandwiches and

products, french fries, soft drinks, breakfast items, and desserts. In most markets,
McDonald's offers salads and vegetarian items, wraps and other localized fare. This
local deviation from the standard menu is a characteristic for which the chain is
particularly known, and one which is employed either to abide by regional food
taboos (such as the religious prohibition of beef consumption in India) or to make
available foods with which the regional market is more familiar (such as the sale of
McRice in Indonesia).
Advertising
Ronald McDonald

McDonald's has for decades maintained an extensive advertising campaign. In addition to the usual media (television, radio, and
newspaper), the company makes significant use of billboards and signage, sponsors sporting events from ranging from Little League
to the Olympic Games, and makes coolers of orange drink with their logo available for local events of all kinds. Nonetheless,
television has always played a central role in the company's advertising strategy.To date, McDonald's has used 23 different slogans in
United States advertising, as well as a few other slogans for select countries and regions. At times, it has run into trouble with its
campaigns.

Global operations
Countries with McDonald's stores

McDonald's has become emblematic of globalization, sometimes referred as the "McDonaldization" of society. The Economist
magazine uses the "Big Mac Index": the comparison of a Big Mac's cost in various world currencies can be used to informally judge
these currencies' purchasing power parity.The EFTA countries are leading the Big Mac Index with the top 3 most expensive Big
Mac's. Iceland has the most expensive Big Mac, followed by Norway and Switzerland.The brand is known informally as "Mickey D's"
(in the US and Canada), "Macky D's" (in the UK), "Mäkkäri" (in Finland), "McDo" (in France, Quebec, the Philippines, and the
Kansai region of Japan), "Maccer's" (in Ireland), "Macarrannis" (in Mexico), "Maccas" (in New Zealand and Australia), "McD's" (in
New Zealand), "Donken" (in Sweden), "de Mac" (in the Netherlands), or "Mac" (in Brazil).Thomas Friedman once said that no
country with a McDonald's had gone to war with another.[14] However, the "Golden Arches Theory of Conflict Prevention" is not
strictly true. Careful historians point to the 1989 United States invasion of Panama, NATO's bombing of Serbia in 1999, and the 2006
Lebanon War as exceptions.Some observers have suggested that the company should be given credit for increasing the standard of
service in markets that it enters. A group of anthropologists in a study entitled Golden Arches East (Stanford University Press, 1998,
edited by James L. Watson) looked at the impact McDonald's had on East Asia, and Hong Kong in particular. When it opened in Hong
Kong in 1975, McDonald's was the first restaurant to consistently offer clean restrooms, driving customers to demand the same of
other restaurants and institutions. In East Asia in particular, McDonald's have become a symbol for the desire to embrace Western
cultural norms. McDonald's have recently taken to partnering up with Sinopec, China's second largest oil company, in the People's
Republic of China, as it begins to take advantage of China's growing use of personal vehicles by opening numerous drive-thru
restaurants.

McDonalds IN INDIA

McDonald's opened its doors in India in October 1996. Ever since then, our family restaurants in Mumbai, Delhi, Pune, Ahmedabad,
Vadodara, Ludhiana, Jaipur, Noida Faridabad, Doraha, Manesar and Gurgaon have proceeded to demonstrate, much to the delight of
all our customers, what the McDonald's experience is all about.

Locally Owned
McDonald’s in India is a 50-50 joint venture partnership between McDonald’s Corporation [USA] and two Indian businessmen. Amit
Jatia’s company Hardcastle Restaurants Pvt. Ltd. owns and operates McDonald's restaurants in Western India. While Connaught Plaza
Restaurants Pvt. Ltd headed by Vikram Bakshi owns and operates the Northern operations.Amit Jatia and Vikram Bakshi are like-
minded visionaries who share McDonald's complete commitment to Quality, Service, Cleanliness and Value (QSC&V). Having
signed their joint-venture agreements with McDonald's in April 1995, they trained extensively, along with their Indian management
team, in McDonald's restaurants in Indonesia and the U.S.A. before opening the first McDonald’s restaurant in India.

Respect for local culture

McDonald's India has developed a special menu with vegetarian selections to suit Indian tastes and preferences. McDonald's does not
offer any beef or pork items in India. Only the freshest chicken, fish and vegetable products find their way into our Indian restaurants

In addition, they have re-formulated some of their products using spices favoured by Indians. Among these are McVeggie™ burger,
McAloo Tikki™ burger, Veg. Pizza McPuff™ and Chicken McGrill™ burger. They have also created eggless sandwich sauces for
vegetarian customers. Even the soft serves and McShakes™ are egg-less, offering a larger variety to vegetarian consumers.

International Standards
McDonald's India's local suppliers provide them with the highest quality, freshest ingredients. Complete adherence to the Indian
Government regulations on food, health and hygiene is ensured, while maintaining company’s own recognized international standards.
Fast, friendly service - the hallmark of McDonald's restaurants the world over is the mantra they abide by. Stringent cleaning standards
ensure that all tables, chairs, highchairs and trays are sanitised several times each hour. Such meticulous attention to cleanliness
extends beyond the lobby and kitchen to even the pavement and immediate areas outside the restaurant.

Company Philosophy

"We take the burger business more seriously than anyone else." When McDonald's founder, Ray Kroc made that memorable
statement, he was letting the world in on the philosophy and secret behind McDonald's phenomenal success.

The principles that guide McDonalds are …

• Quality, Service, Cleanliness & Value - It is an unflinching McDonald's ideology that our customers must always get quality
products, served quickly and with a smile, in a clean and pleasant environment; and all at a fair price

• We are committed to exceeding our customers' expectations in every restaurant every time.

• We have a passion and a responsibility for enhancing and protecting the McDonald's brand.

• We believe in a collaborative management approach, employing a mutually respectful business philosophy,

• We will seize every opportunity to innovate and lead the industry on behalf of our customers.

It was early evening and one of the 25 McDonald's outlets in India was bustling with activity with hungry souls trooping in all
the time. No matter what one ordered - a hot Maharaja Mac or an apple pie - the very best was served every time. But did
anyone ever wonder as to how this US giant managed the show so perfectly? The answer seemed to lie in a brilliantly
articulated food chain, which extended from these outlets right up to farms all across India.
 US-based fast food giant, McDonald's success in India had been built on four pillars:

limited menu,

fresh food,

fast service and

affordable price.

Intense competition and demands for a wider menu, drive-through and sit-down meals - encouraged the fast food giant to
customize product variety without hampering the efficacy of its supply chain.Around the world (including India),
approximately 85% of McDonald's restaurants were owned and operated by independent franchisees. Yet, McDonald's was
able to run the show seamlessly by outsourcing nine different ingredients used in making a burger from over 35
suppliers spread all over India through a massive value chain. Between 1992 and 1996, when McDonald's opened its first
outlet in India, it worked frenetically to put the perfect supply chain in place. It trained the local farmers to produce lettuces or
potatoes to specifications and worked with a vendor to get the perfect cold chain in place. And explained to the suppliers
precisely why only one particular size of peas was acceptable (if they were too large, they would pop out of the patty and get
burnt).
These efforts paid off in the form of joint ventures between McDonald's India (a 100% wholly-owned subsidiary of
McDonald's

Supply chain management at McDonalds (India)

Did you know that every year, Rs. 50,000 crore worth of food produce is wasted in India? This is mainly because of the lack of proper
infrastructure for storage and transportation under controlled conditions. McDonald's is committed to providing quality products while
supporting other Indian businesses. And so, we spent a few years setting up a unique Supply Chain, even before we opened our first
restaurant in India.A Supply Chain is a network of facilities including - material flow from suppliers and their "upstream" suppliers at
all levels, transformation of materials into semi-finished and finished products, and distribution of products to customers and their
"downstream" customers at all levels. So, raw material flows as follows: supplier - manufacturer – distributor – retailer – consumer.
Information and money flows in the reverse direction. The balance between these 3 flows is what a Supply Chain is all about. When
there is a balance in the finished product ordering, the Supply Chain operates at its best. Any major fluctuation in the product ordering
pattern causes excess / fluctuating inventories, shortages / stock outs, longer lead times, higher transportation and manufacturing costs,
and mistrust between supply chain partners. This is called the Bullwhip Effect. Depending on the situation, the Supply Chain may
include major product elements, various suppliers, geographically dispersed activities, and both upstream and downstream activities. It
is critical to go beyond one’s immediate suppliers and customers to encompass the entire chain, since hidden value often emerges once
the entire chain is visualized. For example, a diesel engine manufacturer may be able to integrate a GPS locator system into its engine
control system. Its immediate customer, a heavy truck manufacturer, may see no need for this functionality. However, the downstream
customer, a trucking company with a large fleet, may be very interested in a locator system. Understanding the value to the
downstream customer is part of the supply chain management process
Big Mac's supply chain success

The seed of McDonald's success was sown in 1990 - six years before it started its actual operations. Sanjeev Bhar traces its supply
chain management that played a vital role in its growth.

About two decades ago, the QSR wouldn't have meant much to the Indian F&B segment. Today, the acronym has been seamlessly
absorbed in the industry lingo. McDonald's, arguably, one of the first brands that left a strong imprint on the Indian QSR history, has
much to do with this. And its success is credited to its well-established supply management chain.

According to Vikram Bakshi, managing director and joint venture partner of McDonald's India (North & East), the company
invested about Rs 400 crore even before its first restaurant commenced operations in October 1996. "We had to ensure that we had
the back-end linked up to the farm level for delivery commitment."

The company also deployed the latest state-of-the-art food processing technology for having a sound supply chain. The transition
towards the latest technology, which has been subsequently noticed in other QSRs as well, changed the Indian fast food scenario to
match international standards.

Tracing its success path

McDonald's had been working critically on its supply chain part. Considering, an international brand trying to make inroads into the
Indian consciousness, its Indian supplier partners were developed in such a manner that made them stay with the company from the
beginning. Bakshi explains, "The success of McDonald's India is a result of its commitment to sourcing almost all 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." As per today's standings, McDonald's India works with as many as 38 Indian suppliers on a
long-term basis, besides several others standalone restaurants working with it, for various requirements.

In the supply chain management for a QSR, the distribution centres hold special place for bringing food right to the outlet counters.
For McDonald's India, the distribution centres came in the following order: Noida and Kalamboli (Mumbai) in 1996, Bangalore in
2004, and the latest one in Kolkata (2007).

McDonald's entered its first distribution partnership agreement with Radha Krishna Foodland, a part of the Radha Krishna Group
engaged in food-related service businesses. The association goes back to July 1993, when it studied the nuances of McDonald's
operations and requirements for the Indian market. Recalling the association, Bakshi remarks, "Better facilities and infrastructures
Vital Links in McDonald’s Cold Chain

All suppliers adhere to Indian government regulations on food, health and hygiene while continuously maintaining McDonald's
recognised standards. As the ingredients move from farms to processing plants to the restaurant, McDonald's Quality Inspection
Programme (QIP) carries out quality checks at over 20 different points in the Cold Chain system. Setting up of the Cold Chain has
also enabled us to cut down on operational wastage

Hazard Analysis Critical Control Point (HACCP) is a systematic approach to food safety that emphasizes prevention within our
suppliers' facility and restaurants rather than detection through inspection of illness or presence of microbiological data. Based on
HACCP guidelines, control points and critical control points for all McDonald's major food processing plands and restaurants in India
have ben identified. The limits have been established for those followed by monitoring, recording and correcting any deviations. The
HACCP verification is done at least twice in a year and certified.

The relationship between McDonald's and its Indian suppliers is mutually beneficial. As McDonald's expands in India, the supplier
gets the opportunity to expand his business, have access to the latest in food technology, exposure to advanced agricultural practices
and the ability to grow or to export. There are many cases of local suppliers operating out of small towns who have benefited from
their association with McDonald's India.

Trikaya Agriculture

Suppier of Iceberg Lettuce

Implementation of advancved agricultural practices has enabled Trikaya to successfully grow speciality crops like iceberg lettuce,
special herbs and many oriental vegetables. Farm infrastructure features:

• A specialised nursery with a team of agricultural experts.

 • Drip and sprinkler irrigation in raised farm beds with fertiliser mixing plant.
• Pre-cooling room and a large cold room for post harvest handling.
• Refrigerated truck for transportation.

Vista Processed Foods Pvt. Ltd.

Supplier of Chicken and Vegetable range of products (including Fruit Pies)

A joint venture with OSI Industries Inc., USA, McDonald's India Pvt. Ltd. and Vista Processed Foods Pvt. Ltd., produces a range of
frozen chicken and vegetable foods. A world class infrastructure at their plant at Taloja, Maharashtra, has :

• Separate processing lines for chicken and vegetable foods.

• Capability to produce frozen foods at temperature as low as -35 Degree Cel. to retain total freshness.
• International stardards, procedures and support services.
Dynamix Diary

Supplier of Cheese
Dynamix has brought immense benefits to farmers in Baramati, Maharashtra by setting up a network of milk collection centres
equipped with bulk coolers. Easy accessibility has enabled farmers augment their income by finding a new market for surplus milk.
The factory has:

• Fully automatic international stardard processing facility.

• Capability to convert milk into cheese, butter/ghee, skimmed milk powder, lactose, casein & whey protein and humanised
baby food.
• Stringent quality control measures and continuous Research & Development
Amrit Food

Supplier of long life UHT Milk and Milk Products for Frozen Desserts
Amrit Food, an ISO 9000 company, manufactures widely popular brands - Gagan Milk and Nandan Ghee at its factory at Ghaziabad,
Uttar Pradesh. The factory has:

• State-of-the-art fully automatic machinery requiring no human contact with product, for total hygiene.
• Installed capacity of 6000 ltrs/hr for producing homegenised UHT (Ultra High Temperature) processed milk and milk
products.
• Strict quality control supported by a fully equipped quality control laboratory.

Radhakrishna Foodland

Distribution Centres for Delhi and Mumbai

An integral part of the Radhakrishna Group, Foodland specialises in handling large volumes, providing the entire range of services
including procurement, quality inspection, storage, inventory management, deliveries, data collection, recording and reporting. Salient
strenghts are :

• A one-stop shop for all distribution management services.

• Dry and cold storage facility to store and transport perishable products at temperatures upto -22 Degree Cel.
• Effective process control for minimum distribution cost.

Local Sourcing
McDonald's has always been committed to sourcing its requirements from local suppliers and farmers. This assurance is rooted in the
philosophy of our company's founder, Ray Kroc. He firmly believed in mutual benefits arising from a partnership between
McDonald's and the local businesses, thus ensuring that McDonald's commitment to growth was mirrored by that of its partners.

In keeping with this belief, we have carefully identified local Indian businesses that take pride in satisfying customers by presenting
them with the highest quality products. Adherence to Indian Government regulations on food, health and hygiene were a top priority.

McDonald's India today purchases more than 96% of its products and supplies from Indian suppliers. Even our restaurants are
constructed using local architects, contractors, labour and maximum local content in materials.

The relationship between McDonald's and its Indian suppliers is mutually beneficial. As McDonald's expands in India, the supplier
gets the opportunity to expand his business, have access to the latest in food technology, get exposure to advanced agricultural
practices and the ability to grow or to export. There are many cases of local suppliers operating out of small towns who have benefited
from their association with McDonald's India.

All suppliers adhere to Indian government regulations on food, health and hygiene while continuously maintaining McDonald's
recognised standards. As the ingredients move from farms to processing plants to the restaurant, McDonald's Quality Inspection
Programme (QIP) carries out quality checks at over 20 different points in the Cold Chain system. Setting up of the Cold Chain has
also enabled us to cut down on operational wastage

Hazard Analysis Critical Control Point (HACCP) is a systematic approach to food safety that emphasizes prevention of illness or
presence of microbiological data within our suppliers' facilities and our restaurants rather than its detection through inspection. Based
on HACCP guidelines, control points and critical control points for all McDonald's major food processing plants and restaurants in
India have been identified. The HACCP verification is done at least twice in a year and certified.
Trikaya Agriculture - Supplier of Iceberg Lettuce
Implementation of advanced agricultural practices
has enabled Trikaya to successfully grow speciality
crops like iceberg lettuce, special herbs and many
oriental vegetables. Farm infrastructure features:

• A specialised nursery with a team of

agricultural experts.

• Drip and sprinkler irrigation in raised farm

beds with fertiliser mixing plant.

• Pre-cooling room and a large cold room for

post harvest handling.

• Refrigerated truck for transportation.

Vista Processed Foods Pvt. Ltd. - Supplier of

Chicken and Vegetable range of products
A joint venture with OSI Industries Inc., USA, and
McDonald's India Pvt. Ltd. Vista Processed Foods
Pvt. Ltd. produces a range of frozen chicken and
vegetable foods. A world class infrastructure at its
plant at Taloja, Maharashtra, has :

• Separate processing lines for chicken and

vegetable foods.

• Capability to produce frozen foods at

temperature as low as -35 Degree Celsius to
 retain total freshness.

• International standards, procedures and

support services.

Dynamix Diary - Supplier of Cheese

Dynamix has brought immense benefits to farmers in
Baramati, Maharashtra by setting up a network of
milk collection centres equipped with bulk coolers.
Easy accessibility has enabled farmers augment their
income by finding a new market for surplus milk.
The factory has:

• Fully automatic international standard

processing facility.

• Capability to convert milk into cheese,

butter/ghee, skimmed milk powder, lactose,
casein & whey protein and humanised baby
food.
 • Stringent quality control measures and
continuous Research & Development

Amrit Food - Supplier of long life UHT Milk and

Milk Products for Frozen Desserts
Amrit Food, an ISO 9000 company, manufactures
widely popular brands - Gagan Milk and Nandan
Ghee at its factory at Ghaziabad, Uttar Pradesh. Its
plant has:

• State-of-the-art fully automatic machinery

requiring no human contact with product, for
total hygiene.

• Installed capacity of 6000 litres / hour for

producing homogenised UHT (Ultra High
Temperature) processed milk and milk
products.
 • Strict quality control supported by a fully
equipped quality control laboratory.

Radhakrishna Foodland - Distribution Centre

An integral part of the Radhakrishna Group,
Foodland specialises in handling large volumes,
providing the entire range of services including
procurement, quality inspection, storage, inventory
management, deliveries, data collection, recording
and reporting. Salient strengths are :

• A one-stop shop for all distribution

management services.

• Dry and cold storage facility to store and

transport perishable products at temperatures
up to - 22 Degrees Celsius.

• Effective process control for minimum

 distribution cost.

• McDonald's opened its first store in India in October, 1996 and currently has 113 stores, spread across the North, West &
South of the country.
• We have the sole responsibility of McDonald's entire supply chain all across India.
• We handle their entire range of services including procurement, quality inspection, storage, inventory management, deliveries,
data collection, recording and reporting.

Over the years, subsequent to the commencement of our relationship, Foodland has regularly won the Best Supplier Award from
McDonald's.

McDonald's - Challenges

• Full Supply Chain responsibility

• Multi Temp. Products - Over 65 % temperature controlled
• Stores as far as 500 – 1000 kms
• Drops per month - Over 1000
• Movement mainly by road
• Regular movement of perishables by air
 • Routing Challenges
• No margin for error – Operations critical client
• No Stock Outs at store
• On time delivery record – above 97 %
• Clean delivery record – above 99 %
• Unfailing inbound supply chain

Foodland : how it helps in supply chain of McDonalds?

Foodland provides Customized Distribution & Logistics services encompassing the entire supply chain, such as storage, handling and
distribution solutions to various clients. The services are tailor made to suit each client’s requirements, which include organisations
such as

McDonald's and Radhakrishna Hospitality Services Pvt. Ltd. (RKHS)

Objective

To provide a cost effective solution to our customers ensuring product integrity throughout the supply chain.

Platter Of Services

• Supply Chain Structuring

• Inventory Planning & Replenishment Management
• Warehouse Management
• Customer Order Fulfillment
• Logistics – Temperature Controlled
It handles bulk transportation of temperature sensitive products.

Key Features:

1. Dedicated to ‘cold chain’ movement

2. The only logistics solution provider with expertise in handling agri – produce
3. Total kilometer run per month is – 7,00,000 km
4. Perishable tonnage handled per month – 7,000 tons
 5. Robust quality systems & processes
6. First in the country to use multi temperature vehicles
7. Use of innovative methods to ensure temperature integrity during transit
8. Experienced staff – The BEST in the industry.

Its experience of over a decade in the logistics & distribution industry has led us to believe that there is still one area which remains
poorly serviced – that of

movement of small volumes of perishable items

across the country.
 Our experience also tells us that many companies, for want of a cost-effective and reliable logistics
solution, end up deciding not to market their products which are of a perishable nature in certain markets, thus losing out on potential
revenue opportunities. And because currently, there is no reliable service provider to cater to this need, companies have to move goods
either by air, which is expensive, or through bulk carriers with very little control on the delivery schedule. Given the current scenario,
combined with our domain expertise in the logistics & distribution area, we have launched a new service - Fresh Rush. Fresh Rush is
a temperature controlled transportation service addressing the needs of small volume cargo.

Fresh Rush – Features

• Multi temperature products, such as Frozen (below –18ºC) and Chilled (1ºC to 4ºC) can be transported
• Flexibility of load movement - A minimum of 500 kgs to maximum of 5000 kgs can be transported
• In transit temperature tracking
• Fixed schedule of pickup and delivery
• Well trained and experienced manpower
• Adherence to strict hygiene standards
• Consignment can be tracked through GPS system

1. Food Park, Kalamboli

• First of its kind in India

• Designed as per global standards
• The centre procures, value adds, stores and distributes various kinds of perishable and non-perishable food
products
Food Park – Features

• Spread over 33,000 sq meters

• Multi Temperature Zones
• Integrated Facility – Storage and Value Addition capabilities under one roof
• Ensured / Guaranteed Food Safety
• Paradigm shift in the way food is handled in the supply chain in India
• First of its kind in the region
• Benchmarked against global standards
• Codex / USDA / PFA compliant
• Scalable
• Dedicated storage for specific categories
• Sanitation / Hygiene standards – Trash handling
• Air / Water Quality – Treatment Plant / ETP
• Ripening Rooms, Crate Wash Facilities, Blast Freezer, Flake Ice Machine
 • Value Added Services – Processing of Vegetables & Fruits, Meat, Sea Food and Poultry
• Controls – Building Management System (BMS)
• 100 % Power Back Up

Food Park – Capacity

• Capacity to manage over 6000 SKUs

• Can store 70,000 cases with 1,700 pallet positions and over 4,000 pick faces
• Processing
o
o Vegetable & Fruits – 21 tonnes per day
o Meat – 3 tonnes per day
o Fish – 3 tonnes per day
• Blast Freezing – 6 tonnes – per day
 • Ice Machine – 2.4 tonnes per day

2. Kanjur Marg DC

• Spread over 3,500 sq meters

• Dry Provisions DC
• Capacity to manage over 9000 SKUs
• Can store 80,000 cases with 1400 pallet position and 3,600 pick faces

3. Delhi DC (Noida)

• Dedicated to operations in the North

• Highly functional DC
• Chiller / Freezer / Dry Storage

• Capacity to manage 576 pallet positions

Findings of study conducted

1. Every organisation, no matter how big or small in size,has its own forecasting techniques.This is because without forecasting the
demand and supply requirements, the orders cant be fulfilled. Similarly, for order processing, Mc Donalds forecast its requirements on
a daily basis.
The study that we did in Indore, where there are three outlets of Mc Donalds, each one in a multiplex, revealed that their forecasting
depends on a few factors like the upcoming movie release in that week and its response.
Likewise, we conducted this study in the month of March and the demand during this time is affected by the school and college
examinations.The demand for different departments also vary from one outlet to another.
2.Mc Donalds has its outlets in different parts of the globe.
In India too, Mc Donalds has numerous outletsin different cities, but they do not have any local vendor.
They have a fixed vendor, that is The Radhakrishna Foodland, which caters the range of 230 products that Mc Donalds require.
The Radhakrishna Foodland not only process the fooditems but also handle the logistics partially.The delivery center is at
Mumbaiwhere from the required stock is transported to different locations.
The concerned person told us, that due to the ephimeral shelf-life of tomatoes, it i sthe only commodity that they make purchase from
local markets; specifically of four to five inches diameter which undergoes a thorough sanitization process, only after which it is used.

3.Every organisation has its inventory cycle.The Mc Donalds outlets do keep a safety inventory.
They keep the buffer stock for a period of three days,and their stock is stored at the outlets itself. Every product used in preparing the
menu items come with an expiry date, like the French-fries served in Mc Donalds has a life of two hundred and seventy days. But
once the menu items are cooked,they are not kept for more than
ten minutes, after which they are dumped as waste.
There are daily product safety checklist which is maintained manually as well as with the help of computer softwares too,helping the
staff in assessing the stock quantity at the end of each day.

4.Radhakrishna Foodland had been working with Mc Donalds for the past ten yearsand the trems abd conditions for choosing the
network design was decided by the headquarters of Mc Donalds itself.The food items are transported via air conditioned trucks having
different chambers.Each chamber is designed for the different kind of stock at different temperature levels,as per the suitability and
requirements of the stock.All the raw material comes in a frozen form.The trucks have pre-defined destinations to reach each day.The
sources at Mc Donalds told u sthat the trucks from Mumbai reach Indore on Monday,Pune on tuesday, Hyderabad on wednesday and
so on at Bangalore and Gujarat too.
The items which are to be procured from foreign territories comes to India via ships, like the french fries are obtained from new
Zealand via shipments.

5.They do assess their daily requirements via safety checklists.The rounding and scheduling of ouput and input is done manually and
through computer based softwares too.

6.Mc Donalds does not have any third party logistics.

7.With the evolvement of the new technologies and convenient softwares, the conventional methods of maintaining suplly chain
records are now a passe`.
Mc Donalds too use a standardized visual Foxpro based program via which the outlets are linked with the head office and the
Radhakrishna Foodland too.

8.Mc Donalds believe in the saying "Customer is the King" and thus the the complaints , if any, from the customers end are duly heard
and resolved as per the need of the situation.