In the previous part of our work we were talking about Porter’s value chain of McDonald’s fast-food restaurant. It is known, that before making a statement about competitive priorities, the company should know the objectives of the operation. Is it customer oriented? Does it cover shareholders’ and suppliers’ interests? However, now we consider that McDonald’s has taken into account all of the interests of business environment.
The list of competitive priorities is the same for all entrepreneurship but which of them is more important depends on the company’s decision.
Quality:
From the viewpoint of the customer, McDonalds has a good and confident tone, they consider the taste of food, cashiers; attitude toward clients, the cleanness of venue, the number of mistakes made by cashiers, and other measures to assess the quality of the McDonalds’ burgers. (Slack, Chambers &Johnston, 2003)
However, quality is not fully valued by these points. In fact, McDonald’s operates with a consistent quality product. It can be determined by supervising the operations of any McDonalds’ restaurant. The company has certain standards of cooking dishes, if it is volume oriented and each customer impact on product is not so high, McDonalds pertains to the top-quality operation. On the other hand, McDonalds doesn’t compromise its consumers’ comprehension about quality. From the whole history of the company, it is known that this restaurant has gone through the big quantity of quality inspections in all countries, where its restaurants are located. Evidently, they have credible and verified suppliers. Moreover, McDonalds has a special Quality Assurance team that controls the quality of the product at all stages of production. (Vignali, 2001)
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...ranch and for majority of menu items. It is the correct and profitable position in this question for such business like McDonalds. In general, too much flexibility is equal for high customization. For fast-food retailers it is not profitable to attain high customer involvement criteria because customers in most cases are disruptive and can affect the volume and profit. In simple words, for a system like McDonalds high flexibility can cause the bullwhip effect.
To sum up all information above, it is understandable that McDonalds has positioned itself as fastest and cheapest fast-food retailer. According to this statement, the main competitive priority for the company is low-cost and dependability of their product. Nevertheless, McDonalds takes into account other competitive priority like high design-performance, credible consistent quality and cultural flexibility.
Overall, Costco exploits the Porter’s value chain elements to increase the productivity and efficiency of its operations while also lowering the cost of margins related to the operations of the organization (Guo, 2016). These benefits result in different competitive advantages to the company, which in turn increases the profitability of the organization. For each of the Porter’s value elements, the different stakeholders of the company are also impacted positively. Financial Analysis of Costco Table 1:1 Financial Data in Comparison to the Competitors 2016 2015 2014 Costco Revenue 1620 1467 1350 Net Income 76 72
• Analyzing the value chain of the McDonald’s Corporation to determine where they can create using resources, capabilities, and core competencies, which have been discussed above.
In a high competitive world market and with the increasing rational buyers a company can only win by creating and delivering the best customer value than the others competitors do. To succeed, a company needs to use the concepts of value chain.
Over the half century, McDonald’s had been defining the fast food industry and well known for its low price and convenience. However, as the rise of Wendy’s, Subways and Chipotle Mexican Grill, McDonald’s starts losing revenue and facing the strategic problem of losing its uniqueness by trying to satisfy all the customers in different segments. For example, McDonald’s offers a kiosk feature that allows customers to customize everything about the burger, from the type of bun to different cheeses and sauces that goes on it. This concept is similar to Chipotle Mexican Grill and Panera Bread, where consumers can customize ordering and get fresh ingredients. However, the major customers of McDonald’s are low-income, and the kiosk concept leaves
In order to understand McDonald's structure and culture and why they continue to be the world's largest restaurant chain we conducted a SWOT analysis that allowed us to consider every dimension involved in the business level and corporate level strategies.
Firstly, there is a need to focus on the company competitive dimensions before embarking on the decisions. In this aspect, the Competitive capabilities are the Cost, Quality, Time, and Flexibility dimensions that a process or value chain actually processes and is able to...
Analysing McDonalds (fast food outlets) using Porters 5 Forces model – sometimes called the Competitive Forces model. Introduction McDonalds Canada opened in 1967, thirteen years after McDonalds had taken the United States by storm. This was the first restaurant to be opened outside of the United States. It was in 1965 that McDonalds went public and offered shares on Wall Street. Since then, it has been important for McDonalds to continually monitor its performance, to make sure it is competitive and profitable while also being aware of its immediate community responsibilities.
The menu at McDonald's typically consists of hamburgers, chicken sandwiches, salads, drinks, shakes, and a recent influx of healthier alternatives. McDonald's also is widely known for their breakfast menu, which consists of sandwiches, pancakes, French toast, hash browns, and breakfast drinks. Since McDonald's appeals to such a wide audience, it must constantly re-evaluate its menu depending on feedback and market research. McDonald's expends considerable resources to update its menu and introduce new products in order to be more in tune with its target audience (The Times 100).
McDonald’s vision statement can be said that it wants to be the world’s best quick service restaurant experience. Being the best for McDonald’s means that it needs to provide the best of the quality of food products, services, and cleanliness and value so that it can make everyone of its customer smile (Schmitt and et.al, 2011). A vision statement of the company is an idea for how business can be eventually perceived and what actions it will be taking for coming 5, 10 or 15 years for i...
McDonalds has always been a leader in the fast food industry. Through its dynamic market expansion, new products and special promotional strategies, it has succeeded in making a name for itself in the minds of the target customers. However, McDonald’s earnings has declined in the late 1990’s and 2000s. This is mainly due to a fiercely competitive industry and variety in customer tastes and preferences.
Understanding the basic agreements and variable in the franchising process of a McDonald’s restaurant helps to shed light onto how the company has become such a global power in the food ser...
McDonalds provide high quality products, such as burgers, fries, drinks, muffins, etc, which are safe and reliable that it does what it is supposed to do, but not only does the quality of the products matter, the good value for money affects the business. E.g. buy one extra value meal and get one free with a food voucher that represents the offer only. They ensure that a high standard of the product is carried out at all times and they try to compete very competitively with other fast food businesses with their good value for money. Also a customer would know if the product is good value for money by checking in another food outlet like KFC for their services and products.
Burger King’s core competency is fast food restaurant franchises specializing in made to order, flame-broiled hamburger sandwiches, particularly the “Whopper”. Using the strategy of industrial organization to capture market share Burger King offers a similar product (hamburgers) in a different way (flame-broiled). This strategy of product differentiation is part of the firm conduct category that Burger King uses to set itself apart from its competitors. In order to compete with its fast food competitors Burger King accentuates its core competencies in its marketing and product strategies, thereby leveraging market share.
...mendations for managers of fast food restaurants for the increase of brand loyalty and customer satisfaction’. It is a requirement for organisation to change their business strategies to follow the current trends, customer needs and requirement (Kim et al., 2001). When a management follows the service quality model from Parasuraman et al. (1985) to modifying their products according to the customer requirements, they will be more likely to be successful in the era of intense competition (Cater and Cater, 2009). This is one of the reasons that the companies are more interested in identifying the requirements of their target customers so that they can ensure that the organisation’s products are developed exactly according the client needs and requirements (Howard, 2006). This section can clearly shows the consumer expectation in fast food industry in Manchester.
CHANGING PREFRECE depended vastly on the fast food manus. For example we can mention about SALAD. Now salad was never considered as a part of fast food menu. But with the change of taste and preference, fast food chains like Windy, Taco Bell, and McDonald have introduced SALAD into their menus. This preference is not stopping only with salads. In 2002, McDonald’s introduced great tasting new products including premium salads, n salads plus menu; Chicken McNuggets made with white meat; Fish McDippers; Chicken Selects; and new breakfast offerings like the McGriddle sandwiches. Here as a fast food chain, McDonald did not have to introduce new dishes in their menus but with the impression and image in the market analysis, of increasing demand and chan...