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McDonald's

Introduction: The McDonald's Corporation is the world's largest chain of hamburger fast food

restaurants, serving around 68 million customers daily in 119 countries across 35,000 outlets.
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 franchisee, an affiliate, or the corporation itself.
McDonald's Corporation revenues come from the rent, royalties, and fees paid by the
franchisees, as well as sales in company-operated restaurants. In 2012, McDonald's Corporation
had annual revenues of $27.5 billion, and profits of $5.5 billion. According to a 2012 report by
the BBC, McDonald's is the world's second largest private employer (behind Walmart) with 1.9
million employees, 1.5 million of whom work for franchises.
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, fruit, and seasoned fries.
McDonalds in Australia: Back in 1971, McDonald's opened its first restaurant in a Sydney

suburb called Yagoona. Today there are over 900 McDonald's outlets across Australia and they
employ around 90,000 people across the restaurants and management offices. With more than
one million customers coming through the restaurants every day, its their priority to maintain the
customers trust and integrity. To do this they make sure that the customers and employees receive
the respect they deserve. Through honesty, hard work and outstanding quality, service,
cleanliness and value (QSC&V) they make sure that the restaurants are up to the standard the
customers deserve.

Organizational Mission: McDonald's brand mission is to be our customers' favorite place and

way to eat and drink. Our worldwide operations are aligned around a global strategy called the
Plan to Win, which center on an exceptional customer experience People, Products, Place,
Price and Promotion. We are committed to continuously improving our operations and enhancing
our customers' experience.

Organizational Vision: McDonald's vision statement is "to be our customers' favorite place and
way to eat and drink." This portrays the company's aspirations towards providing quality

customer experiences and services. The long-term goal is to retain current customers, attract new
customers and be a favorite place to eat for many people.

Organizational Values:
We place the customer experience at the core of all we do - Our customers

are the reason for our


existence. We demonstrate our appreciation by providing them with high quality food and
superior service in a clean, welcoming environment, at a great value. Our goal is quality, service,
cleanliness and value (QSC&V) for each and every customer, each and every time.
We are committed to our people - We provide

opportunity, nurture talent, develop leaders and


reward achievement. We believe that a team of well-trained individuals with diverse
backgrounds and experiences, working together in an environment that fosters respect and drives
high levels of engagement, is essential to our continued success.
We believe in the McDonalds System - McDonalds business

model, depicted by our threelegged stool of owner/operators, suppliers, and company employees, is our foundation, and
balancing the interests of all three groups is key.
We operate our business ethically - Sound

ethics is good business. At McDonalds, we hold


ourselves and conduct our business to high standards of fairness, honesty, and integrity. We are
individually accountable and collectively responsible.
We take seriously the responsibilities that come with being a
leader. We help our customers build better communities, support Ronald McDonald House
Charities, and leverage our size, scope and resources to help make the world a better place.
We give back to our communities -

We grow our business profitably - McDonalds is

a publicly traded company. As such, we work to


provide sustained profitable growth for our shareholders. This requires a continuous focus on our
customers and the health of our system.
We strive continually to improve - We are

a learning organization that aims to anticipate and


respond to changing customer, employee and system needs through constant evolution and
innovation.

SWOT Analysis of McDonalds:

Strengths:

Largest fast food market share in the world

Brand recognition valued at $40 billion

$2 billion advertising budget

Locally adapted food menus

Partnerships with best brands

More than 80% of restaurants are owned by independent franchisees

Children targeting

1. Largest fast food market share in the world. McDonalds is the largest fast
food restaurant chain in terms of total world sales (8%). It is the second largest outlet
operator with more than 34,000 outlets, serving 69 million consumers every day in 119
countries.
2. Brand recognition valued at $40 million. Companys brand is the most
recognized brand in fast food industry and is valued at $40 billion. McDonalds is also
famous by the Ronald McDonald clown.

3. $2 billion advertising budget. McDonalds spends on advertising more than the


next 4 fast food restaurant chains combined.

4. Locally adapted food menus. The fast food chain is operating in many diverse
cultures where tastes in food are extremely different than those of US or European
consumers. Thus ability to adapt to local tastes is one of McDonalds strengths.
5. Partnership with best brands. McDonalds offers only most popular brands in its
restaurants, such as: Coca Cola, Yogurt, Heinz ketchup and others.

6. More than 80% of restaurants are owned by independent


franchisees. Therefore, McDonalds can focus more on perfecting its serving system
and marketing campaigns.
7. Children targeting. The business successfully targets very young children through
offering playgrounds, toys with its meals and advertisements.

Weakness:

Negative publicity

Unhealthy food menu

Low differentiation

Employment practices and low wages

Criticism and negative publicity

Image of a cheap place to eat at

Competition based on prices rather than differentiation

1. Negative publicity. McDonalds is heavily criticized for offering unhealthy food to


its customers, stimulating obesity and strong marketing focus on very young children.

2. Unhealthy food menu. Although McDonalds tries to introduce healthier choices in


its menu, the menu is largely formed of unhealthy meals and drinks. Such menu offering
prompts protests by organizations that fight obesity and hence, decreases McDonalds
popularity.

3. Mac Job and high employee turnover. Mac Job is a low paid and a low skilled
job, which is often seen negatively by its employees. This results in lower performance
and high employee turnover, which increases training costs and add to overall costs of
McDonalds.
4. Low differentiation. McDonalds is no longer able to substantially differentiate itself
from other fast food chains (at least not enough to gain some market share) and opts to
compete by price rather than by additional features.

Opportunities:

Changing customer habits and new customer groups

Increasing demand for healthier food

Expand McCaf network and separate it from the traditional McDonalds restaurants

Expand McDelivery services

Expand make your own burger service

Growing middle class in China

1. Increasing demand for healthier food. While demand for healthier food
increases, McDonalds could introduce more healthy food choices in its menu and reverse
its weakness into strength. McDonalds is trying to seize such an opportunity and soon
plans to open only vegetarian restaurant in India.

2. Home meal delivery. McDonalds could exploit an opportunity of delivering food to


home and increase its reach to customers.
3. Full adaptation of its new practices. McDonalds has redesigned its logo and
restaurant design in 2006. In addition, it has introduced some new practices. In a result,
remodeled restaurants have seen 8-9% higher than average market growth. McDonalds
should finish remodeling all of the restaurants and adapt the best practices in them as
soon as possible.
4. Changing customer habits and new customer groups. Changing customer
habits represent new needs that must be met by businesses. So far, the company has been
successful in introducing its McCaf, McExpress and McStop restaurants to meet the
changing customer habits and the needs of previously untapped customer groups.

Threats:

1.

Saturated fast food markets in the developed economies

Trend towards healthy eating

Local fast food restaurant chains

Currency fluctuations

Lawsuits against McDonalds

Intensifying rivalry

Saturated fast food markets in the developed economies. The fast food
market in the developed countries is already overcrowded by so many fast food restaurant chains
and this already proves to be a threat to McDonalds as it barely grew through 2012.

2.

Trend towards healthy eating. Due to government and various organizations


attempts to fight obesity, people are becoming more conscious of eating healthy food rather than
what McDonalds has to offer in its menu.

3.

Local fast food restaurant chains. Local fast food restaurants can often offer a
more local approach to serving food and menu that exactly represents local tastes. Although
McDonalds does a great job in adapting its own menu to local tastes, the rising number of local
fast food chains and their lower meal prices is a threat to McDonalds.

4.

Currency fluctuations. The business receives a part of its income from foreign
operations. The profits that are sent back to US have to be converted into dollars and may be
affected by the exchange rates, especially when the dollar is appreciating against other
currencies. In 2012, McDonalds profit was largely affected by appreciating dollar.

5.

Lawsuits against McDonalds. McDonalds has already been sued for many times
and lost quite a few lawsuits. Lawsuits are expensive as they require time and money. And as
McDonalds continues to operate more or less the same way, there is high probability for more
expensive lawsuits to come.

Strategic Planning:

McDonalds strategic plan is called plan to win. The concept of this plan is for McDonalds to
not be the biggest fast food restaurant chain, but to be the best fast food restaurant chain.
McDonalds tries to achieve this by applying the five Ps: People, products, place, price
and promotion. Along with this they also incorporate geographic strategic plans.
In the U.S., McDonalds strategic plan continues to focus on breakfast, chicken, beverages and
convenience. These are the core areas in the United States. McDonalds has launched the
Southern Style Chicken Biscuit for breakfast and the Southern Style Chicken Sandwich for lunch
and dinner. In the beverage business, McDonalds starting introducing new hot specialty
coffee offerings on a market-by-market basis.
In Europe, McDonalds uses a tiered menu approach. This menu features premium selections,
classic menu, and everyday affordable offerings. They also complement these with new
products and limited-time food promotions.

In the Asia-Pacific, Middle East, and Africa markets, McDonalds strategic plan is focused
around convenience, breakfast, core menu extensions and value. With McDonalds overall
strategic plan and its geographical strategic plan, the company should start to see more positive
financial results.
As well as all this, McDonalds also incorporates organizational strategic plans which include
better restaurant operations, placing the customer first, menu variety and beverage choice.
All of these strategic plans make McDonalds global brand gain a very high turnover rate and
you can see how far McDonalds has grown since it first opened up in 1940.

Strategic Objectives and need for the Future: The current situation of McDonalds appears to

be quite challenging. Overall customer traffic to the restaurants declined by 1.6 percent in the
United States in 2013. Customers were not happy with the prices at McDonalds and when the
chain revamped its Dollar Menu, customers didnt consider it to be anything extraordinary. Its
Mighty Wings failed miserably and the restaurant had to have a chicken wing clearance sale to
get rid of the extra food.
It seems as if McDonalds is doomed to fail. There are several reasons for it. First, the overall
fast food chain is facing declining customer service and an overloaded menu. There has also
been a significant change in consumer perception about fast food in general and McDonalds in
particular.
There is no doubt that McDonalds has overloaded its menu. Most of the new items have been
nothing but expensive flops. McDonalds did try to diversify and improve its image as a coffee
shop. They even tried to promote it by giving away free coffee. It is believed that it wants to
become more like Starbucks but it is highly doubtful that this would become a reality.
McDonalds has also been unsuccessful at convincing customers that its menu items are actually
healthy. Efforts to shed the unhealthy image have not worked yet. More and more consumers are
now demanding ethically sourced and sustainable ingredients. There have been complaints
regarding the level of transfat in its products.

McDonalds customer service is also at a low. Drive-thru times have slowed and workers feel
overwhelmed.

The future looks even more daunting because the taste of the American consumer is changing.
McDonalds now faces tough competition from fast-casual rival chains such as Chipotle,
Mexican Grill and Panera Bread. In countries outside the U.S., McDonalds has to now deal with
non-traditional competitors, including cafes, convenience stores, bakeries and ready-to-eat
supermarket meals. The chain has made changes to its menu and has introduced new chicken and
bean items, smoothies and an enhanced breakfast menu but the competition still remains
aggressive.

Europe has always been a big market for McDonalds accounting for more than one-third of its
operating income and half of the company-operated margins. The European market for burgers is
declining. Sales have been declining in Germany and France. In fact, traffic to McDonalds
restaurants in Germany is contracting much faster than for other fast-food chains.

According to McDonalds CEO Don Thompson, Customers want to personalize their meals
with locally relevant ingredients. They also want to enjoy eating in a contemporary inviting
atmosphere. And they want choices; choices in how they order, choices in what they order and
how theyre served.

Unfortunately, these requirements are being fulfilled in a much better way by other restaurants
such as Chipotle. Chipotle offers complete customization of food and antibiotic-free meats.
Evaluation:

McDonalds faces some difficult challenges. Key to its future success will be maintaining its core
strengths an unwavering focus on quality and consistency while carefully experimenting with
new options. These innovative initiatives could include launching higher-end restaurants under
new brands that would not be saddled with McDonalds fast food image. The company could
also look into expanding more aggressively abroad where the prospects for significant growth

are greater. The companys environment efforts, while important, should not overshadow its
marketing initiatives, which are what the company is all about.
Potential Competitors:
The major competitors of McDonalds are;

Burger King Worldwide Inc.


Yum! Brands Inc.
Subway
Darden Restaurants, Inc.
Wendy's International, Inc.

Starbucks Corporation
Let us take a competitor of McDonalds and compare the two companies:

Burger King Worldwide Inc.


Introduction:
Burger King, often abbreviated as BK, is a global chain of hamburger fast food

restaurants headquartered in unincorporated Miami-Dade County, Florida, United States. The


company began in 1953 as Insta-Burger King, a Jacksonville, Florida-based restaurant chain.
After Insta-Burger King ran into financial difficulties in 1954, its two Miami-based
franchisees, David Edgerton and James McLamore, purchased the company and renamed it
Burger King. Over the next half century, the company would change hands four times, with its
third set of owners, a partnership of TPG Capital, Bain Capital, and Goldman Sachs Capital
Partners, taking it public in 2002. In late 2010, 3G Capital of Brazil acquired a majority stake in
BK in a deal valued at US$3.26 billion. The new owners promptly initiated a restructuring of the
company to reverse its fortunes. 3G, along with partner Berkshire Hathaway, eventually merged
the company with Canadian-based donut chain Tim Hortons.

Vision Statement: Our

commitment to premium ingredients, signature recipes,


and family-friendly dining experiences is what has defined our brand for more
than 50 successful years.
Mission????
Organisation Values??????
Objectives???????????

Operational Strategy:

Driving sales and traffic in the U.S. and Canada: They have identified the following four pillars
that they believe will enable them to drive future sales and traffic in the U.S. and Canada:
Menu. The strength of our menu has been built upon our signature flame-grilled cooking
process, which we believe results in better tasting burgers. Our menu strategy seeks to optimize
our menu by focusing on our core products, such as our flagship Whopper sandwich, while
enhancing our menu to broaden our appeal to women, parties with kids and seniors. Our recently
launched initiative to focus on our food expanded our product platforms and introduced 21 new
or improved menu items in 2012. We believe that our renewed focus on our food will provide us
the opportunity to meaningfully increase same store sales and margins.

Marketing & Communications. We have established a data driven marketing process


which is focused on driving restaurant sales and traffic, while targeting a broader consumer base
with more inclusive messaging. Through our food-centric marketing communication strategy, we
believe we can refocus our consumers on our food, which is a core asset and competitive
differentiator.

Image. We believe that our contemporary "20/20 design," which draws inspiration from
our signature flame-grilled cooking process, will drive same store sales, higher profits and strong
return on invested capital. To encourage franchisees to commit to these remodeling efforts, we
developed a lower cost remodeling alternative and provided our U.S. franchisees with access to a
third-party financing program. As of December 31, 2013, ~30% of the North America system
was in the "20/20 design", and our goal is to have 40% reimaged by 2015.


Operations. We have restructured our field teams through our "field optimization
project," to significantly increase our field presence and restaurant visits by reducing the span of
control of our field teams. We believe that this reduction in the number of restaurants for which a
field employee is responsible will improve all aspects of restaurant operations, including food
quality, guest service, and speed of service and restaurant cleanliness. We also redefined the role
of a field employee to be that of a "business coach" who is responsible for closely working with
the restaurant teams and franchisees to achieve their sales, profit, and operational goals. The field
employees variable compensation is linked to the performance of those franchise restaurants.
We believe that this "business coach" approach will ensure accountability and alignment with our
franchisees. We have also launched standardized operational metrics to evaluate restaurants that
focus on those core competencies that we believe will maximize the guest experience. We
believe that enhancing our guests experience increases traffic to restaurants and provides us and
our franchisees the opportunity to improve sales and margins.
SWOT Analysis:

Strengths
Geographic Diversification

Burger King has over 11,500 fast food restaurants located in over 70 countries. 7,207 of its
restaurants are located in the United States (62%) and another 4,358 are established in
international locations (389%) such as Asia, the Middle East, Africa and Canada.
Opportunities
New Breakfast Food Initiative

Burger King is seeking to overhaul its breakfast menu and will add Starbucks Corp.s Seattles
Best Coffee to all its U.S. restaurants. It has introduced earlier restaurant opening times in its
United Kingdom locations.
New Healthier Menu Items

Burger King sponsoring its biggest new product launch in years by introducing the Tendercrisp,
Premium Chicken Burger and accompanying the launch with a marketing campaign called
cheat on beef.

National Urban Community Marketing Initiative

Burger King is seeking to strengthen its standing in the African American Community through its
new next best move promotion which includes a well-publicized tour of 41 urban communities
across the country.
Brand Licensing Project

Burger King has entered into a licensing arrangement (brokered by Broad Street Licensing
Group) to further increase the companys brand awareness and broaden the presence of the
iconic King character, various licensees of Burger King Corp. will soon launch a line of
branded T-shirts, and also an exclusive collection of sleepwear and lounge ware.

Threats
Unrest among Franchisees

Burger Kings new dollar cheese burger initiative and loss leader strategy has upset some of its
franchise owners who feel the pricing violates the franchise agreement. The dispute spurred the
National Franchisee Association to file a lawsuit against the company. In 2009 Franchisees voted
twice against the new promotions. The company reportedly has dropped the $1 burger
promotion, but there may be bad feelings lingering for a while.
The Slow Recovering Economy

The challenging global economy continues to hamper the companys financial strength (ranked
238th among its peers). Burger King posted weaker-than-expected quarterly results in the last
half of 2009, and missed stock analysts expectations. The decline was driven in part by
continued adverse macroeconomic conditions, including record levels of unemployed.
Changing Consumer Eating Habits

Burger Kings same-store sales in the U.S. and Canada declined 4.6% in the three months ended
Sept. 30, 2009. People 18 to 34 cut their consumption of fast-food meals from November 2006 to
November 2009 according to the market-research firm NPD Group. The combination of the

economy and better health information has influenced people to eat at home and to opt for leaner
lower calorie foods.
Established Market Share

Among Fast Food restaurant chains, Burger King is second only to McDonalds and holds a 15%
share of the United States market. The companys profitability has also increased in recent years.
In the period 2006-08, its operating profit has increased from $170 million in FY2006 to $354
million in FY2008.
Globally Recognized Brand

Burger King is able to boast a brand that is widely recognized thanks to its flagship slogan have
it your way, the whopper sandwich and most recently enhanced by its mascot known as the
King. The company was recently ranked 7th in brand awareness.

Weaknesses
Vulnerability to Labor and Regulatory Influences

Although the company operates in many international venues, the majority of restaurants are in
the United States. This concentration of operations in one geographic area increases companys
exposure to local factors such as labor strikes and the influence of regulatory changes.
Reliance on so-called Super Customers

There is some indication that Burger King may have been slow to transition to leaner and
healthier restaurant fare in favor of pleasing its long term customers who are fans of the big
larger portion sandwiches.

Starbucks Corporation

Introduction:
Starbucks Corporation, generally known as Starbucks Coffee, is an American

global coffee company and chain based in Seattle, Washington. Starbucks is the
largest coffeehouse company in the world ahead of UK rival Costa Coffee, with 21,160 stores in
63 countries and territories, including 12,067 in the United States, 1,570 in China, 1,451
in Canada, 1,070 in Japan and 793 in the United Kingdom.

Starbucks locations serve hot and cold beverages, whole-bean coffee, micro ground
instant coffee, full-leaf teas, pastries, and snacks. Most stores also sell pre-packaged food items,
hot and cold sandwiches, and items such as mugs and tumblers. Starbucks Evenings locations
also offer a variety of beers, wines, and appetizers after 4pm. Through the Starbucks
Entertainment division and Hear Music brand, the company also markets books, music, and film.
Many of the company's products are seasonal or specific to the locality of the store. Starbucksbrand ice cream and coffee are also offered at grocery stores.

Organizational Mission:
To inspire and nurture the human spirit one person, one cup and one neighborhood at a

time.

Organizational Values:

With our partners, our coffee and our customers at our core, we live these values:

Creating a culture of warmth and belonging, where everyone is welcome.

Acting with courage, challenging the status quo and finding new ways to grow our
company and each other.

Being present, connecting with transparency, dignity and respect.

Delivering our very best in all we do, holding ourselves accountable for results.

We are performance driven, through the lens of humanity.

Organizational Vision:

Establish Starbucks as the premier provider of the finest coffee in the world while
maintaining our uncompromising principles while we grow."

Organizational Objectives:

Distinguish between aims, strategies and tactics

Aims are the general long-term goals of an organization. They are mainly expressed through
vague and unquantifiable statements. Aims serve to give a purpose to the general statements and
vision statements. On the other hand, strategies are used to refer as any plans or schemes to
achieve the long term aim of a business. It is used for trying to achieve strategic objectives.
Lastly, tactics are short-term ways that organizations use to achieve their aims and objectives,
they are used to achieve the tactical objectives. Both strategies and tactics carry matching
purposes. They both help the organization in dealing with how it can get to where they want to
be.
Strength and Weakness????????

Distinguish between a mission statement and a vision statement

A mission statement defines what the company is, why it exists and its reason for being as well
as an outline of the organization values. It should serve to unify all people and corporate cultures
within the organization in attempt to achieve its vision.
It should identify the primary objectives related to the customer, needs, how the company will
grow, its team values and more. It should also lists the broad goals for which the company is
formed which is to define key measures of the company success. Mission Statement should also
be the first consideration for evaluating any strategic decision. However, it does not have a
distinct time frame and tends to be qualitative rather than quantitative statements.
A vision statement outlines where a company wants to be and its purpose and values in terms of
the future. Vision statements are generally shorter in length and must captures essence of a
companys goal. However, it does not explain how the company is going to achieve those goals.
It provides a roadmap for where the company wants to be. It should also be inspirational and
aspirational.

Explain the importance of objectives in managing your organization.

Starbucks objective is vital to their business because without having it clearly stated, the
company would lack a sense of direction and purpose. Its objectives also said the company in the
process of decision-making where they can then create strategies to achieve outlined goals.
Furthermore, its objectives can provide the foundation for measuring and controlling the
performance of the company as a whole.
In Starbucks case, one of their main objective is to maintain its standing as one of the most
recognized and respected brands in the world. In order to achieve this goal, their strategies are
clearly stated where they will continue their disciplined expansion of their global store base. This
statement provides encouragement and a strategic thinking platform for workforce and the
management team in order to reach their goal, especially a sense of direction.
Starbucks second goal is to continue to offer costumers new coffee products in a variety of
forms, across new categories, and through diverse channels. This statement clearly outlines the
goal of the company in terms of its products. It not only provides the foundation for measuring
and controlling the performance of the workforce, but it allows them a sense of direction and to
understand the importance of constantly bringing new and innovative products to the market.
Analyze the role of your companys mission or vision statement.

Starbucks mission statement is to inspire and nurture the human spirit one person, one cup
and one neighborhood at a time. Missions statements generally define what the company is, its
reason for existence, company values and outlined broad goals in aid of the company for
evaluating any strategic decisions. Looking at Starbucks mission statement, its role is to serve as
a directive for the whole companys operation. For example, to inspire and nurture the human
spirit may set as a directive for the company stores interior design, food and coffee presentation

and staff members working attitudes as having a positive and well-presented environment can be
highly inspirational. As for one person, one cup and one neighborhood at a time. this again
guides the company towards the goal of the continuous expansion hence its aim to increase
mass market reach.

With reference to your company, discuss the relationship between aims,


strategic, objectives and tactical objectives.

Aims serve to give a purpose to the general statements and vision statements. In Starbucks
case, their aim is to increase mass market reach. On the other hand, strategic objectives are
long-term organizational goals that aid a mission statement from a broad vision to more
specific plans. In comparison to aims, strategic objectives regard the HOW to achieve the
aim. As for tactical objectives, they are daily, weekly or monthly projects that implement
larger strategic objectives. They are set out with strategic objectives in mind and provide an
action plan for the company, management team or staff to break down a larger strategic goal
into workable tasks. In Starbucks case, their aim is to increase mass market research, which
is to expand market coverage, for example through increasing the number of retail stores. To
add on here are some of Starbucks strategic objectives: Focusing on relevant product
innovation and profitable new growth platforms, timely completing certain supply chain
capacity expansion initiatives, including increased roasting capacity and construction of a
new soluble products plant and a new Evolution FreshTM plant, executing a multi-channel
advertising and marketing campaign to effectively communicate our message directly to
Starbucks consumers and employees. etc. Last but not the least, some of Starbucks tactical
objectives are to increase their market share in disciplined manner, by selectively opening
additional stores in new and existing markets as well as increasing sales in existing stores, to
support their long- term strategic objectives and aims.

The most appropriate strategic plan for your Venture?????

McDonalds is booming, despite all the economic destruction going on around it.
It has been the second-best performing stock in the Dow in 2011. In Q3 it beat revenue and profit
projections yet again, its stock is up 63% in the last three years and same store sales continued to
climb for the 103rd month, reports Julie Jargon at the Wall Street Journal.
The success goes back further than that, too. Since 1980, McDonald's has absolutely blown away
some of the biggest Dow blue chips around (like IBM, DIS, GE and XOM), notes Bespoke
Investment Group.
Meanwhile, competitors like Burger King and Wendy's continue to try new things as they fight
each other for the #2 spot, but they're still leagues behind. McDonald's just keeps dominating,
and it now has upwards of 33,000 stores worldwide. Yet somehow it's still expanding, and in
more ways than one.
So, how's McDonald's doing it? Its powerful brand and sheer size are two big, dependable
advantages that it can always lean on.
But just being McDonald's isn't enough it's doing a lot, domestically and globally, to stay
ahead. Here are ten strategies that are keeping McDonald's barreling forward:
Focusing heavily on emerging markets
McDonald's may seem like it's already everywhere, but it hasn't quite saturated the world yet.
Over the past few years, McDonald's has made a heavy push toward emerging markets. And not
just trendy markets like China and India, but places previously devoid of the Golden Arches, like
some African nations. Sales are up 8.1% from last year in Asia/Pacific, Africa and the Middle
East.
Still, China is McDonald's most important international front, where it's battling Yum!
Brands wholeheartedly. It plans to have a whopping 2,000 stores there by 2013 that's 1,000
new stores in just four years.
It's going to need to keep it up, because the Colonel still reigns supreme in the world's biggest
market, and Yum! Has no intention of letting up.

McCaf has been a big win


The McCaf has been demolishing expectations ever since the company started revving up its
marketing machine for it in 2002.

Now, there are 1,300 McCaf's worldwide in dozens of countries, and it just keeps growing. Its
latest moves have been to Ukraine, along with a national rollout in Canada. The McCaf menu
has been growing as well, adding non-coffee items like smoothies over the past couple years.

Offering a wider variety of food to attract more segments


Its not just snack foods and desserts that it's expanding into there's a whole lot more.
McDonald's is trying to get more consumer segments to chomp up its offerings by expanding
non-traditional menu items, while keeping its core base of burgers-and-fries eaters.
Many of the new items help combat McDonald's ever-present negative image of unhealthiness,
though it will likely never shake it fully. For instance, oatmeal has been a big hit for McDonald's,
serving as a replacement for high-calorie breakfast sandwiches. Additional types of salads have
worked too, for people looking for a somewhat healthier option.
Delivering food to customers in places that demand it
Though not traditional in the US, McDonald's delivers in many markets around the world,
and the company cites it as one of the reasons it has been so successful in those markets.
Why? Delivery is a common practice, even for fancy restaurants, in many Asian and Middle
Eastern cities, so McDonald's is just meeting the cultural norms of its surroundings. Yum!
Brands' KFC does it too, with equal success.
A select few places in the US deliver too there are 10 stores in Manhattan that will bring a
burger and fries to your building but there are no plans to roll it out nationally.

Making its stores more attractive to get customers in


McDonald's is improving its physical locations to make them more appealing to customers, and
it seems to be working. In China, it's trying out a "Less is more" concept design, which goes with
softer colors and cushioned seats.
Also, over 95% of McDonald's locations have extended their hours now, and it has several
thousand stores that are open 24/7.
Free Wi-Fi is now available in McDonald's restaurants across the world, and lately it has made a
big push to get flat screen TVs in the stores. It's even starting up its own TV channel with
original programming, called McTV.

Increasing its offering of snack items


Americans love to snack on stuff, and McDonald's has recognized that demand and answered
with a plethora of new products.
Smaller items like wraps, along with an expansion into desserts (which it plans to ramp up soon),
have made their way onto the menu and have done well.

Expanding its dollar menu to breakfast


McDonald's fired up a breakfast dollar menu in 2010 as the economy continued to slump, which
supplemented its existing dollar menu for its usual fare. It has been working well thus far,
capitalizing on Americans' attraction to the super-cheap in times like these.
But even before that, its breakfast business was growing, just at a lower rate than normal.
Competitors like Burger King and Dunkin' Donuts have made their own types of dollar menu,
but nobody has had the widespread success that McDonald's has enjoyed.

And it hasn't been scared to take anybody on


Many of these expansions drew looks from brand new competitors, because McDonald's was
encroaching on their territory. In most cases, McDonald's leveraged its size and brand to attack
head on.
McCaf is the most obvious example, and it has performed admirably against Starbucks and
Dunkin' Donuts. Its upcoming expansion into desserts is likely to concern Dunkin' even more,
along with niche dessert chains like Dairy Queen.
But there's plenty of risk in doing this. As it opens it to more fronts than ever, it has bigger,
powerful brands breathing down its neck, and even more complexity to worry about in its
internal operations.