INTRODUCTION:McDonald’s Corporation is the world’s leading food service organization. The corporation started out as a small drive-through in 1948 by two brothers, Dick and Mac McDonald. Raymond Albert Kroc, a salesman, saw a great opportunity in this market and advised Dick and Mac to expand their operation and open new restaurants. In 1961 Kroc bought out the McDonald brothers. By 1967 McDonalds expanded its operations to countries outside the U.S.A. This unyielding expansion led the Corporation to open 23,000 McDonald’s restaurants in 110 countries in 1994, producing $3.4 bn in annual revenues. In addition, McDonald’s opens a new restaurant every three hours. Also, McDonald’s has twice the market share of its closest U.S. competitor, Burger King, representing 7% of total U.S. eating-out sales. Similarly, McDonald’s serves about 1% of the world’s population on any given day through its 23,000 restaurants internationally.
Big Mac, the world’s most sold hamburger was developed by Jim Delligutti in 1967 to feed construction workers. ‘Big Mac’ is the biggest attraction and backbone of the corporation. Moreover, McDonald’s maintains its competitive advantage by constantly creating new items to add onto its menu. This shows us that McDonald’s practices an analyzer type of strategy, introducing new items and defending its existing ones.
McDONALD’S MISSION AND VISION:
We serve people with good quality food, fast and at low cost.
McDonald’s vision is to dominate the global food-service industry. Global dominance means setting the performance standard for customer satisfaction and increases market share and profitability through successfully implementing our convenience, value and execution strategies.
To have a clear picture of McDonald’s corporation we need to look at its Task Environment, which includes its:
We shall also explore McDonald’s Workforce Diversity and its Total Quality Management.
Customers are those who pay money to acquire an organization’s goods or services.
For many years McDonald’s mostly targeted the young people, however this has changed in this decade; McDonald’s has turned towards a more general market. By doing this McDonald’s concentrates on the family, targeting a diverse market which includes consumers ranging from children to elderly people, using products such as the happy Meal for children and Egg McMuffin for the elderly. McDonald’s also realized the changing world we live in and the need for healthier food, since there is an ever changing demographic group, who demand fast, top quality food that is low in calories. McDonald’s responded to this opportunity and introduced a new and innovative product. This new product was a regular hamburger that tasted like the real thing but was made of plant material like Soya beans. This same product also targets another demographic group, vegetarians.
McDonald’s mostly uses psychographic segmentation targeting the working and middle classes. These are the people that are more susceptible to enter a fast food restaurant, since these are the people that lead a fast moving life and thus require a fast meal.
In brief McDonald’s customers are of all classes, but largely working and middle classes, and people of all ages.
A competitor is an organization that competes with other organizations for resources.
In our findings, McDonald’s has two types of competitors in the Lebanese market:
Indirect refers to firms producing one or two products that compete with McDonald’s products and therefore be a threat to the company.
We have identified four indirect competitors: Henry J. Beans, T.G.I. Friday, K. F. C. and Popeye’s.
Henry J. Beans offers hamburgers and fries on its menu, therefore competing with McDonalds for customers of these products. However, Henry J. Beans also known as Hank’s is a more of a bar restaurant and therefore a hang out place, as a result charging more money for its products. Hank’s targets middle to upper class customers, so where most of these customers overlap are in the middle class.
T.G.I Friday is another indirect competitor reflecting the same characteristics as Henry J. Beans. Other indirect competitors are K. F. C. and Popeye’s, both competing for the chicken nuggets and fries customers.
In brief, Hank’s and T.G.I. Friday’s competes with McDonald’s by offering hamburgers and fries, whereas K. F. C. and Popeye’s compete with McDonald’s by offering chicken nuggets and fries.
Direct competitors refers to firms producing the same products or services as McDonald’s does.
Here we found that McDonald’s has three direct competitors: Burger King, Wendy’s and