mcdonalds restaurants edition 9 worksheet
McDonald’s
Types of business organisations
http://www.thetimes100.co.uk/case_study.php?cID=28&csID=120
Questions
1. How does brand franchising enable an organisation like McDonald’s to grow?
2. How does brand franchising reduce the risk for the franchisee?
3. Why are franchisees prepared to pay McDonald’s 4.5% of their sales revenue towards national marketing costs?
4. McDonald’s operates in over 119 countries. How does McDonald’s ensure standardisation of the McDonald’s experience throughout the world?
5. What is the relationship between standardisation and quality?
6. How is McDonald’s able to ensure quality within its restaurants?
7. Why does McDonald’s provide ongoing support to franchisees?
8. Why are McDonald’s franchises likely to be successful?
9. Explain how McDonald’s benefits from economies of scale in food production in the restaurant.
10. How does the ‘three legged stool’ approach benefit McDonald’s customers, suppliers, franchisees and McDonald’s?
McDonald’s
Types of business organisations
Answers
1. Brand franchising is where a well known franchisor grants a franchise to a franchisee to use its brand, systems, and to sell its products usually in a specified geographical area. Brand franchising enables the franchisor to share the risk with its partner franchisors, and also to share the capital costs and running costs of developing a network – in the case of McDonald’s a network of restaurants.
2. For the franchisee, buying a franchise is much cheaper and less risky than establishing a comparable size business from scratch. One of the main problems for a start-up business is that of developing the brand and reputation associated with branding. Buying a McDonald’s franchisee immediately provides the franchisee with an internationally known product that consumers are familiar with. The franchisee also buys into established tried and tested systems and products.
3. If an individual sets up a new restaurant the chances are that they
Types of business organisations
http://www.thetimes100.co.uk/case_study.php?cID=28&csID=120
Questions
1. How does brand franchising enable an organisation like McDonald’s to grow?
2. How does brand franchising reduce the risk for the franchisee?
3. Why are franchisees prepared to pay McDonald’s 4.5% of their sales revenue towards national marketing costs?
4. McDonald’s operates in over 119 countries. How does McDonald’s ensure standardisation of the McDonald’s experience throughout the world?
5. What is the relationship between standardisation and quality?
6. How is McDonald’s able to ensure quality within its restaurants?
7. Why does McDonald’s provide ongoing support to franchisees?
8. Why are McDonald’s franchises likely to be successful?
9. Explain how McDonald’s benefits from economies of scale in food production in the restaurant.
10. How does the ‘three legged stool’ approach benefit McDonald’s customers, suppliers, franchisees and McDonald’s?
McDonald’s
Types of business organisations
Answers
1. Brand franchising is where a well known franchisor grants a franchise to a franchisee to use its brand, systems, and to sell its products usually in a specified geographical area. Brand franchising enables the franchisor to share the risk with its partner franchisors, and also to share the capital costs and running costs of developing a network – in the case of McDonald’s a network of restaurants.
2. For the franchisee, buying a franchise is much cheaper and less risky than establishing a comparable size business from scratch. One of the main problems for a start-up business is that of developing the brand and reputation associated with branding. Buying a McDonald’s franchisee immediately provides the franchisee with an internationally known product that consumers are familiar with. The franchisee also buys into established tried and tested systems and products.
3. If an individual sets up a new restaurant the chances are that they