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Mcdonald’s – Aspects of Best Business Strategy

A well-known fast food chain with locations all over the world is McDonald’s. It began operating in the 1960s and presently serves a global chain of 30,000 eateries. A feature of these restaurants is that they offer their food in accordance with the local culture.

A number of modern artefacts have been extremely well organised, like the well-known product, its promotional policy using well-known toys and movies, its involvement with charitable organisations, and its distribution of classified ads.

Local men and women own and run more than 75% of the franchise. Every day, it serves more than 40 million individuals. Around 82% of its revenue comes from 8 different nations, including Japan, Korea, Australia, France, Germany, and the United States. The major accomplishments for the franchise in these nations. However, it has been in forging a positive brand image and name recognition in the minds of the populace, with hygienic precautions serving as the primary competitive advantage that draws in a large number of consumers.

They have developed a corporate symbol, and extensive advertising has aided the franchise by imprinting a positive perception of the company’s name and emblem in the minds of millions of customers.

Owning all of the lands on which McDonald’s was built, regardless of whether it was owned by the corporation or a franchise, has been a significant component of the firm’s strategy from the start. Although the amount of rent varies depending on the property, it has been estimated that it makes more money from renting the property than it does from the franchise fees it charges.

Since its inception, it has been successful thanks to the excellent customer service it offers. Each restaurant strives for a positive brand image by serving high-quality meals and providing excellent customer service and has made a name for itself in both industries by providing high-quality, reasonably priced food and excellent service. It offers a small menu with fantastic selections.

Mcdonald’s franchise business model

A three-structured franchise model is used by McDonald’s. 90% of the restaurants owned and run by the company are franchises. Franchisees manage their restaurants under the company’s supervision and serve as their employees’ employers.

They have a lot of influence over how their restaurants are priced, sold, and run. A global master plan called “Plan To Win,” which is the foundation of it’s corporate plan of action, is used. It upholds each of the four principles outlined in its mission statement: “Quality, Service, Cleanliness, and Value.”

  • It earned 19.21 billion dollars in total revenue in 2020.
  • Placed ninth in a ranking of brands in 2021 based on their worth, up 20% from the year before, with about 155 billion dollars.

Segments in McDonald’s business model

The segments can be classified qualitatively into the following four groups:

  • The biggest market, which is still the United States as of 2018, is still quite important.
  • Australia, Canada, France, Germany, the United Kingdom, and comparable markets are examples of international lead markets.
  • China, Italy, Korea, the Netherlands, Poland, Russia, Spain, Switzerland, and other regions with high development potential are among the high-growth markets.
  • The remaining markets in it’s system, the majority of which use a substantially franchised model, are known as foundational markets and corporate.

The business model for McDonald’s: marketing techniques

  • This fast food franchise aims to improve the customer experience by concentrating on the five Ps. People, products, place, price, and promotion are the five Ps.
  • McDonaldization: The term “McDonaldization” is frequently used to refer to the franchise’s success in the global market. More than 120 countries have found success with it because of its organisational structure. The central organization’s principal priority is localization.
  • Relationship with Employees: it offers support to its employees unlike any other company. Career prospects, a great work environment, and solid partnerships all promote business success.

Growth plan and accelerators at McDonald’s

The Velocity Growth Plan, McDonald’s business model and customer-centric approach, was launched in 2017 and focuses on three crucial parts of the business’ operations: food, value, and customer experience.

  • Emphasizing markets where it already has a strong presence, such as family gatherings and food-focused breakfasts, would help retain current clients.
  • gaining back fewer frequent visitors: reaffirming its dedication to its historical advantages, including food’s superior flavour, quality, and convenience.
  • converting transient users into loyal ones: boosting snack and treat offerings while reinforcing and expanding the McCafé coffee brand in order to foster long-lasting relationships with customers and encourage frequent visits.

The three growth accelerators will continue to be aggressively deployed by the fast food franchise in 2019 and beyond:

  • Modernization and technical advancements that enhance the dining experience and the patrons’ perception of the brand are referred to as “Experience of the Future” (“EOTF”).
  • Digital: To provide consumers with additional options for ordering, paying, and receiving service, it’s is improving its technological platform. This includes adding functionality to its global mobile app, installing self-service kiosks, and implementing tools that make curbside and table service possible.
  • Delivery: In 2018, the franchise expanded its delivery service to more than 50% of its global restaurant network. For the first time in the United States, It announced a partnership with Uber Eats in 2017, and in 2019 it added DoorDash and GrubHub. These alliances are focused on the younger generation of consumers who prefer home delivery to pickup as part of a master plan to stay relevant.

McDonald’s competitive advantages

McDonald’s competitive advantage is as follows:

  • It’s main advantage over competitors is its affordability. The company makes extensive use of economies of scale to gain a cost advantage.
  • It is renowned for its quick customer service without sacrificing the calibre of the service, staying true to the “fast food” style of its locations.
  • Another major component of the taste’s universality is it’s competitive advantage. The Big Mac essentially always tastes the same because the same ingredients are used in the same quantities and the same cooking methods are used all over the world. Such consistency in flavour will increase customer loyalty.

This business has a long history. It’s achievement is entirely based on in-depth evaluation of each internal and external market dynamics. It has conducted studies on a country’s population’s behaviour, culture, purchasing power, and social issues.

In order to achieve the highest production in the shortest amount of time, it has given particular consideration to the location of the company, its interior and exterior outlook, and the types of technologies it will utilise. The most important aspects that it focused on were the quality and market factors that directly affected the company.

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Aditi Rai
Aditi Rai
Aditi is an aspiring writer, an advocate of mental health, and a college student. She is currently pursuing her bachelor's degree in microbiology. She loves to read about diverse subjects and produce unbiased thoughts in her writing.

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