McDonald’s Restaurant Ltd

Group Presentation

Presented ByAdeel Wali Muhammad

Muhammad ZafarZafar Iqbal

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 recommendation

What is this Presentation all about?

• 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 million people a day in the UK .

SHORT STORY

• 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 Service• 2009 :: McDonald's introduces three versions

of Angus Burgers

BRIEF HISTORY

SWOTAnalysis

Brand Recognition

Leader In Quick Service Sandwich Industry

Strongest International Presence

Real Estate Holdings

Easily Recognizable Products

Variety Sources of Income

Franchise Business Model

Analysis of McDonald’sStrengths

SWOTAnalysis

Customer Service Level

Poor Management

Poor Marketing

Struggles in Offering Value/ Premium Items

High Employee Turnover

Weaknesses

SWOTAnalysis

Growth In Global Food Service Industry

Initial Public Offerings In Other Countries

Acquisition of Other Restaurants

Retail Sales of Merchandises

Opportunities

SWOTAnalysis

Increased Competition from Various Industries

Health Conscious Consumer Trends

Saturation of World Fast-food Market

Slow Growth in Sandwich Segment

Price War Business Practices

Threats

SWOTAnalysis Liquidity

Profitability

Asset Utilization

Leverage

Not extremely liquid but capability in financing short-term debt will not be a problem.

SITUATIONAnalysis

Profitable Declining trend but returns to normal level of profitability in 2003

High inventory turnover compliant to nature of industry

Normal Leverage Has ability to cover debt obligations

Financial Analysis

Marketing Analysis

SWOT Analysis

Situation Analysis

4 P’s Analysis

$Product

• Wide variety of menu items - traditional items- health-conscious items

• Local flavors

Marketing Analysis

SWOT Analysis

Situation Analysis

4 P’s Analysis

$Promotion

• I’m lovin’ it campaign to attract family• Feature artists to target teenagers• Give Ronald a more prominent place

Marketing Analysis

SWOT Analysis

Situation Analysis

4 P’s Analysis

$Place

• 30,000 stores worldwide• Operations

- Company-owned- Franchise

4 P’s Analysis

$SWOT

Analysis

Situation Analysis

Marketing 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

Present

+

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

Poor Customer Service Level

SWOT Analysis

Situation Analysis

Present

+

Past

Management Critique

• Cantalupo took over in 2003• Launched initiatives aimed to

- internal operations- slowing down expansion- enhancing relevancy to customers

• Shown positive progress

Concerns

• Sustainability of Initiatives?• Or is it just Cyclical Trend?

Brand

Situation Analysis

SWOT Analysis

Situation Analysis

Distinctive Competencies

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

Sustainable Competitive Advantage

• World Recognition• Presence > 120 countries

Concern: Deteriorating Franchise Management

Concern: Negative Brand Perception – “JUNK FOOD”