McDonald’s: Serving Fast Food Around the World

International Case: McDonald’s: Serving Fast Food Around the world.

Answer 1:

A thorough understanding of the case leads us to the following opportunities and threats for McDonald’s.

Opportunities

1. People always want high quality at a moderate/low price. They also need fast service in spotless surroundings. McDonald’s, due to its global presence and international practices, can provide all these at an affordable price.

2. The Eastern countries were not introduced to fast food. Fast food had barely touched many cultures then. Hence, McDonald’s saw fast food as an attractive business in the far eastern countries.

3. They are in family-oriented business and there was no other chain with similar services in fast food who were offering services to the entire family in Europe. In fact, McDonald’s saw a great opportunity by way of selling products for children in Europe where children were not welcomed in restaurants.

4. The taste for Fast food, especially American style, is growing more rapidly in other places than in US. This is an immense opportunity for expansion for McDonald’s outside the US.

Threats

1. Prejudices: The main issue when entering a new geography is the need to understand the culture prevalent there. McDonald’s had a tough time explaining what a Hamburger means to a German who felt hamburgers were people from the city of Hamburg. Similarly, in Japan, Potatoes were used only to make starch. So, McDonald’s found it difficult to explain its products to the locals in both these countries.

2. They maintain the same traditional menu with limited items.

3. Expansion in France was delayed though McDonald’s was highly profitable because they had to revoke their French franchises who failed to meet their cleanliness standards. They could have easily lost the French market as a result of this move.

4. In the foreign countries, local people were not aware of McDonalds’ Brand. As a result, acceptance in expansion might be more difficult than anticipated.

5. Local food chains pose a serious threat to McDonald’s menu. For E.g. Sushi restaurants were becoming popular in Japan.

How did they overcome?

1. Traditional menu was surprisingly successful. So they did not have the need to bring in new items to satisfy the needs of the customer.

2. They provided training for owners and local managers in Hamburger University near Chicago. This enabled them to have uniformity in service and also maintain the same quality standards throughout.

3. In order to maximize the use of the local market, they agreed for buy potatoes from local supplies. This helped McDonald’s to sharpen their distribution channel.

4. The advertising campaigns are based on local themes and reflect