McDonald’s is the world’s biggest fast-food service company, that is serving just in the UK over eight million customers daily. 80% of McDonalds restaurants worldwide is owned and operated by local franchises. The main product of McDonald’s is serving hamburger, chicken burger, cheeseburger, breakfast, soft drinks and desserts. McDonalds aims is to provide food in less 5 minutes to customers. There are sub objectives which are to serve good food in a very friendly and fun enviroment, to be a socially responsible company and supply good returns to shareholders. They also would like to be to be eco-friendly and to serve healthier food. Moreover, McDonalds aims to maximize their profits, survive by staying in the market by earing enough money to keep the restaurant working and to grow to achieve new goals. McDonald’s company profit average grow on a constant level even with fluctuating performance. The company’s profit declined in year 2007 and in year 2014, but the company retain its performance afterwards. In order to maintain its net profit within the market and create the company additional profitable McDonald’s is working on a project which bring some changes to its strategy and product.
Figure 1: McDonald’s net income 2005-2016 | Statistics 1
McDonald’s mission statement in 2013: “Our mission is to be our customers’ favourite place and way to eat & drink. We’re dedicated to being a great place for our people to work; to being a strong, positive presence in your community; and to delivering the quality, service, cleanliness and value our customers have come to expect from the Golden Arches – a symbol that’s trusted around the world.” 2.
This mission statement is showing that the brand is mainly focused on the trust between the customer and the product of the company. The confidence is disclosed in the logo of McDonald’s, the Golden Arches which represent the symbol of trust. To translate this target, the mission is focused on the satisfaction of the customers.
The Strategic planning is the vital key to accomplish the target of McDonald’s. Through strategic planning, businesses can determine clear objectives and formulate a plan with processes accompanied with the resources required. Actually, Strategic designing allows an organization to create fundamental decisions or choices by taking a long-range view of what it hopes to accomplish and the way it will do.
McDonald’s uses strategic planning in its all processes and projects long time ago and they achieved always their goals. The management of McDonald’s have shown better understanding of where the business presently stands and what changes it can implement in order to achieve the goals.
1st Business tool SWOT:
McDonald’s has successfully extended new items like coffees, smoothies, and Angus burgers, expanding the vary of menu selections. With a strong product providing, the company has grown income throughout the recession, notching strong will increase in same-store sales. Operations are unfolded around the world, which means the corporate isn’t exposed to merely once currency or economy. Even trading close to its highs, McDonald’s serves up sizzling dividing yields that top the 10-year Treasury. The yield comes with a aspect order of annual dividend hikes dating back to 1976. The annual dividend payment has gone from 55 cents per share in 2005 to $2.20 this year. However, McDonalds have some weaknesses. It will be harder and more durable to seek out prime locations to make a group of golden arches. The U.S. is saturated with its restaurants, this growth can occur internationally, move potential cultural challenges. While the annual dividend hikes are doubtless to continue, the dividend growth rate has been slowing and most likely can still slow or change surface. As McDonalds have some weaknesses, There are opportunities for brand new restaurants outside the US, and McDonald’s has been taking advantage of them. Also, McDonald’s is planning takeover the Asian markets where it is planning to open 1500 restaurants in China and South Korea which is a great opportunity for the organization to expand. McDonald’s faces many threats where there are regulations and campaigns to raise awareness that are targeting fast-food services. McDonalds main threat is having some competition from another fast-food restaurant like Burger King, KFC and Shake Shack. Furthermore, Commodity prices are increasing which limits McDonalds to increase their prices to earn profit as the economy has weaken as it will make. As McDonalds is a fast-food service which the company is not a big fan of having healthy meals which will to lose their healthy audience. Unless the brand changes its menu to a healthier menu which might attract the healthy consumers. There are two factors that MacDonald’s must put some attention into them and they are the brand’s reputation and the customer change as the new generation is taking over the place. As the customer demographics is changing, McDonald’s need to adjust its promoting strategies to focus on the millennial generations better. The new generation is health aware and would love a healthier menu. However, even vital factor is that the items should be priced attractively. Food Quality and valuing the products are essential areas that the fast-food services should concentrate on. The company also needs to focus on its reputation. Moreover, Food quality is an issue that is affecting MacDonald’s. As the scandal in China has damaged its reputation brand name where a viral video has exposed Macdonald’s where it showed that the workers used expired meat products. In order to MacDonald’s be the customer’s favourite there are further improvements that need to be made.
2nd Business tool Ansoff Matrix:
Ansoff Matrix is a business strategy tool that help executives, senior managers, and marketers to have a future plan for the company. McDonald’s is currently the largest fast-food company in the world. The company has increased its market share of existing customer and it has ensured dominance in a growing market. In the past ten years McDonald’s has increased its market penetration by opening a delivery service and clever pricing by offering deals. Also, the cooperation has supported many events like the Olympics in London and sponsoring football teams. For example, McDonald’s sponsor the Football Association which estimated to worth £12 million. As for Product Development, McDonald’s always make new products and have new innovations and present it to its customers. For example, The brand has extended its menu by adding more options like, Frutizz, semi skimmed milk and mineral water. Also, MacDonald’s developed a meal called “Big ocean meal” which is fish sandwich.In 2007, the product was launched, after two weeks the product was removed because the sandwich didn’t sell well.In order to, maintain its to cope with the new generation, MacDonald’s has given the customer the option to combine a Mcchicken with more healthier options. Another example is Disney colllabration with McDonald’s Happy meals. Mcdonald’s is a worldwide brand that succeded in taking over global markets. The company has more than 31,000 franchises worldwide.McDonalds has adopted a global act approach to penetrate different and providing new products. McDonald’s is adopting a product diversification approach in Australia by launching a brand new coffee shop, called The Corner. The company has moved beyond on than offering healthy options in the menu, Mcdonalds is thinking to make an Arabian flavoured sandwich or French sandwich which is based on cultures. McDonalds considers that a new and different product section and has launched it in one market.
In Conclusion, As people have gotten very specific about their health, therefore, it is necessary for McDonald’s’ to retain its good image in minds of consumers and to keep up its food quality and the prices. They may need to target producing low-fat merchandise and should consider entertaining kids in a lot more different ways that as well just like the play section they have already got. McDonalds should try and maintain its services in order to cope up with the changing social desires and market needs. Moreover, management at McDonalds’ should be able to carefully arrange such innovation and that they should use effective strategic tools to implement such change in the future, this may facilitate them to attain its vision of a food trade that has a health-conscious sub-image that is consistent with the latest trend in health awareness these days and for the future.