McDonald’s

ASSIGEMENT 1 : GLOBAL FORTUNE 4 ESG 6 | ASSIGEMENT 1 : GLOBAL FORTUNE |

Officially brought in France in 1979, McDonald’s was founded on May 15th 1940 in California as a « Speedee Service System » to become the McDonald’s that we know today on May 4th 1961. It has over 32 000locations worldwide. France was the nineth country to actually open a McDonald’s restaurant.

McDonald’s worldwide revenue for the year 2010 was $24 billion which puts the company amongst Fortune’s global 500 (ranking at number 378). Let’s analyze the company’s behavior on the French market both externally and internally.

I) External analysis
Potential entrants:

Weak KFC is indevelopment in France

Porter’s forces

Industry Competitors:

Quick, KFC, sandwich shop,
Pizza hut, Domino’s Pizza …
Suppliers:

Food industry,
Multinational company
Buyers:

unfaithful

Substitutes:

Sandwich, snacks,
Traditional food,
eating at home

About potential entrants, there are no real threats because of the difficulty of to create a new big fast food company, such asfinancial capacity. Thus the risk can be considerate as weak event if KFC can be viewed, as a new competitor through is development in France.
Speaking about the industry competitors, the competition is very strong in France as well as in the world. On the fast food market, Quick and KFC are the biggest competitors but it is also possible to consider the pizza market with pizza hut for example and thesandwich shop market such as real competitors. Moreover, its new development with Mc café allows to say that Starbucks and bars are new competitors.
On the subject of substitutes, there is only a medium threat. Sandwiches, snacks, home deliveries such as sushi shop, snack and traditional lunch can be considered as substitutes. Moreover, French people have the habit to cook at home but it cannotbe considered as a real threat because of the eating habits that are evolving.
About buyers, their power is very strong because of them unfaithfulness. They have a real large choice in order to eat, thus McDonald’s uses advertising as a real way to attract them. Moreover, consumer organizations reinforce their power.
Finally, power of suppliers is very different according to the supplier.Multinational companies such as Coca-Cola or Danone are powerful supplier and are important in the negotiation whereas others suppliers such as meat company or greens company don’t have a real power over McDonald’s which can be a big buyer.

Critical Success Factor
Critical success factor, are features particularly valued by the customers and are four for McDonald’s.
* Customer range
*Nutrition
* Availability
* Affordability

First of all, the customer range is a real key success that allows the firm to respond to all of customers needs, its ability to appeal to a wide range of customers. The creation of chicken Mcnuggets, the big Mac, or the happy meals are few examples. There is always a new sandwiches and some which are used as an event because of their limited life.The availability also is a critical success factor of the company. Indeed, there are so many restaurants that everywhere we are, it is really easy to access to a McDonald’s. Moreover, there is always a restaurant closed to shopping centers, shops and in city center to be accessible to everybody. Thanks to its presence strategy, the firm became a real place in cities and in customer’s life. Nowadays,there are more than 32,000 restaurants in 121 countries.
Then, the nutrition takes part of the critical success factor of Mcdonald’s, which has been used it as a real part of the products since 2004. High quality choices are included on the menu. Moreover, the firm provides customer-friendly nutrition information on menu items.
Mcdonald’s is becoming more than just a fast food restaurant….