International case McDonald’s: Serving fast food around the world
Mam Samia Abdullah
1. What opportunities and threats did McDonald’s face? How did it handle them? What alternatives could it have chosen? Ans: Opportunities:
This wonderful phrase echoes around the world 50 million times a day, in 30,000 locations, in multitude of languages, in more than 120 countries around the globe. And this simple thought sums up the reason McDonald's has become the best known and most popular quick service restaurant around the world, quite a tribute to Ray Kroc, who founded this company nearly 50 years ago with the simple vision expressed by his phrase 'Take good care of those who work for you, and you will float to greatness on their achievements' Threats:
The threats to McDonald’s domestically are the lack of growth opportunities. The market is well saturated, and it would difficult to achieve double-digit growth. Other concerns are a newfound emphasis on healthier eating. But I feel the key threat to McDonald’s continued success. Because McDonald’s are everywhere, the dining experience is never special. And as Baby Boomers age and become more affluent, it is likely that they will leave behind their fast-food ways, if only to step up to moderately priced restaurants like Olive Garden, KFC and Pizzeria Uno. These chains have the added advantage of serving higher-margin alcoholic drinks. McDonald’s, meanwhile, has to continually battle Burger King and Wendy’s, which leads to an erosion of margins for everyone. Even alliances with toy manufacturers, while popular with consumers, do little for the bottom line because the cost to run these promotions can be quite expensive. How to handle them:
McDonald’s faces some difficult challenges, the best solutions for them are: * Key to its future success will be maintaining its core strengths. *...