McDonald’s Restaurant

Ltd
Group Presentation

Presented By
Adeel Wali Muhammad
Muhammad Zafar
Zafar Iqbal
What is this Presentation all about?

This Presentation will

• Overview selected business
(McDonald’s),
its objectives
• Overview Business Strategy of
McDonald’s
• Provide Analysis of McDonald’s
(SWOT, Situation)
• Provide conclusions and
 SHORT STORY
• Ray Kroc was the founder of
McDonald’s.
• McDonald’s operates over 31,000
restaurant worldwide ,
employing more than 1.5
million people.
• McDonald’s operates in 120
countries on six continents.
• McDonald’s serves more than 50
million customers a day
worldwide, and more than 2.5
 BRIEF HISTORY
• 1940 :: First McDonald’s Opened
in USA
• 1953 :: McDonald’s Began To
Franchise
• 1964 :: McDonald's issued its
first annual report
• 1975 :: Drive Thru Was
Introduced
• 1984 :: Ray Kroc Died on 14th
January
• 2005 :: McDonald’s Opened Wi-Fi
 Analysis of McDonald’s
Strengths
SWOT Brand Recognition
•

Analysis
•Leader In Quick Service Sandwich Industry
•Strongest International Presence

•Real Estate Holdings

•Easily Recognizable Products

•Variety Sources of Income

•Franchise Business Model
 Weaknesses
SWOT Customer Service Level
•

Analysis
•

Poor Management
•

Poor Marketing
•

Struggles in Offering Value/ Premium Items

•

• High Employee Turnover

 Opportunities
SWOT Growth In Global Food Service Industry
•

Analysis
•

Initial Public Offerings In Other Countries

•

Acquisitionof Other Restaurants

•

Retail Sales of Merchandises

•

•
 Threats
SWOT Increased Competition from Various Industries
•

Analysis •

Health Conscious Consumer Trends

•

Saturation of World Fast-food Market

•

Slow Growth in Sandwich Segment

•

• Price War Business Practices

 Financial Analysi
SWOT Liquidity Not extremely liquid but
•

Analysis capability in financing short-term

Profitability debt will not be a problem.
SITUATIO ••
Profitable
N Asset Utilization •Declining trend but returns to
Analysis normal level of profitability in
Leverage •2003
High inventory turnover
compliant to nature of industry

•Normal Leverage
•Has ability to cover debt

obligations
 Marketing Analysis
4 P’s Analysis
SWOT

$
Analysis

Situation
Analysis

Product
•Wide variety of menu items
- traditional items
- health-conscious items
•Local flavors
 Marketing Analysis
4 P’s Analysis
SWOT

$
Analysis

Situation
Analysis

Promotion
•I’m lovin’ it campaign to attract family
•Feature artists to target teenagers
•Give Ronald a more prominent place
 Marketing Analysis
4 P’s Analysis
SWOT

$
Analysis

Situation
Analysis

Place
•30,000 stores worldwide
•Operations
-Company-owned
-Franchise
 Marketing Analysis
4 P’s Analysis
SWOT

$
Analysis

Situation
Analysis

Price
•Traditionally - value-pricing as competitive weapon
•Now, offer products at range of price points
-attract both price-sensitive and health-conscious consumers
 Management Critique

SWOT
Analysis

Situation
Analysis •Series of unsuccessful initiatives
Past •Aggressive store expansion 
cannibalization
•Tensions – stopped QSVC evaluation

+ Poor Customer Service Level

Present
 Management Critique
Concerns
SWOT
Analysis •Sustainability of Initiatives?
•Or is it just Cyclical Trend?
Situation
Analysis
Past

+
•Cantalupo took over in 2003
Present •Launched initiatives aimed to
- internal operations
- slowing down expansion
- enhancing relevancy to customers
•Shown positive progress
 Situation Analysis

Distinctive Competencies
SWOT
Analysis
Franchise Business Model
Situation
Analysis
•Pioneer in Franchise Management
•Quick Expansion – Leader in Quick Serve Industry
•“Standardization” – What McDonald’s is Known For

Concern: Deteriorating Franchise Management

Sustainable Competitive Advantage

Brand
•World Recognition
•Presence > 120 countries

Concern: Negative Brand Perception – “JUNK FOOD”