PROJECT ON

MAREKETING STRATEGIES OF MCDONALDS

IN PARTIAL FULFILLMENT OF THE DEGREE

BACHELOR OF MANAGEMENT STUDES
UNDER THE UNIVERSITY OF MUMBAI

SUBMITTED BY

ZAID QURESHI.
TYBMS

(ROLLNO. 19)

PROJECT GUIDE

PROF.MR DIPAK BORICHA

BACHELOR OF MANAGEMENT STUDIES

SEMESTER V

SANT GADGE MAHARAJ COLLEGE OF COMMERCE

AND ECONOMICS

MUMBAI 400 004

 PROJECT ON

MAREKETING STRATEGIES OF MCDONALDS

IN PARTIAL FULFILLMENT OF THE DEGREE

BACHELOR OF MANAGEMENT STUDES
UNDER THE UNIVERSITY OF MUMBAI

SUBMITTED BY

ZAID QURESHI.
TYBMS

(SEATNO. 19)

PROJECT GUIDE

PROF.MR DIPAK BHORICHA

BACHELOR OF MANAGEMENT STUDIES

SEMESTER V

SANT GADGE MAHARAJ COLLEGE OF COMMERCE

AND ECONOMICS

MUMBAI 400 004

 DECLARATION

I, ZAID QURESHI student of BMS – Semester V (2015-2016)

hereby declare that I have completed this project on
“McDONALD’S”.

The information submitted is True & Original to the best of

my knowledge.

PLACE:

DATE:

______________
Student’s Signature
ZAID QURESHI
Name of Student
 CERTIFICATE

This is to certify that Mr. ZAID QURESHI of T.Y.BMS has successfully

completed the project on “McDONALD’S” under the guidance of
PROF.MRS DIPAK BOHRICH

The information submitted is true and original to the best of my knowledge

Project Guide Principal

Prof.DipakBoricha Dr. K.Y shinde

Course Co-ordinator
DR Deepak salve

External Examiner
 McDonald’s

ACKNOWLEDGEMENT

It gives me great pleasure to submit this project to the University of Mumbai as a part of curriculum
of my BMS course. I take this opportunity with great pleasure to present before you this project
on “McDonald’s” which is a result of co-operation, hard work and good wishes of many people.

No words can adequately express my sincere thanks to all those who have help me in making this
project a success.

Also I acknowledge my deep sense of gratitude towards my guide Professor Mr.

Dipakboricha

I am grateful to Mr. K.Y. shinde Principal of sant gadge Maharaj College of Commerce
& and Prof Mr. Dipak boricha BMS Co-ordinator (Bachelor of Management Studies)

My debt to those who have helped me in one way or the other is heavy indeed. I would like to
appreciate contribution of my family and friends who have extended their complete support in
completion of this project.

Last but not the least; I am thankful to the Almighty for giving me strength, courage and patience
to complete this project.

(ZAID QURESHI
 EXECUTIVE SUMMARY

McDonald’s is a globally successful fast-food restaurant. From the time of its birth it has
gain enormous success and is growing at the international level. The powerful entry through
franchisee system the standardization and adaptation strategy play an important role in gaining the
huge success of McDonald’s and brand image of McDonald’s.

McDonald’s strategy of standardizing their products on its preparation, techniques of

presentation along with the adaptation strategy has created a difference in McDonald’s as
compared to that of its competitors.

Marketing being my subject interest knowing the strategy of one of the most successful
company will really help me out. Thus, I have chosen McDonald’s as my study of subject for my
100 marks project in TYBMS. This has really helped me out to know lots of marketing techniques
and practically understand the McDonald’s strategy of standardization and adaptation.
[

STUDY:

In the project focus has been made on McDonald’s franchise in India. The challenges faced,
their target market, segmentation strategies. The supply chain of the company and its ability to
provide best quality food at the best cost. The 5 P’s of McDonald’s and the various schemes
provided by the company to its employees while working in McDonald’s and even after their
retirement from the company. McDonald’s as a service industry its life cycle is also studies. The
present strength and weakness of the company and the future opportunities and its future threats
are also study for better analysis of McDonald’s marketing in India.

CONCLUSION:

Studying McDonald’s and its marketing system has helped me a lot in understanding the
marketing subject in a better manner. And it will be helpful for me in near future.
 McDonald’s

INDEX
TITLE PAGE NO.

I. DECLARATION
II. CERTIFICATE
III. ACKNOWLEDGEMENT
IV. 1 EXECUTIVE SUMMARY

CHAPTER I:-INTRODUCTION 01-05

1. INTRODUCTION 01-02
2. HISTORY 03-04
3. FRANCHISEES 05

CHAPTER II: - MCDONALDS IN INDIA 06-13

1. THE INDIAN BEGINNING 06-08

2. OUR VISION 09
3. CHALLENGES IN ENTERING INDIAN MARKET 10
4. SEGEMENTATION ,TARGETING AND POSITIONING 11-13

CHAPTER III: - MCDONALDIZING THE SUPPLIERS

1. SUPPLY CHAIN 14-22

CHAPTER IV: - MARKETING MIX

1. PRODUCT 23-29
2. PLACE 23-24
3. PRICE 25
4. PROMOTION 25-26
5. PEOPLE 26-28
28-29

CHAPTER V: - MC EMPLOYEE
1. EMPLOYEE BENEFITS 27-30
2. FACILITIES
30-31
3. EMPLOYEE RECOGNITION
32
4. RETIREMENT BENEFITS 33
34-35
 McDonald’s

TITLE PAGE NO.

CHAPTER VI:-MCDONALDS IN SERVICE INDUSTRY

1. MCDONALDS EXPERIENCE 31-35
2. MOMENT OF TRUTH 35-36
3. IMPORTANCE OF PRODUCT LIFE CYCLE 36-37
4. A PERFECT EXAMPLE OF REVITALIZINGA PRODUCT IN 37
DECLINE STAGE 37

CHAPTER VII:- ANALYSIS

1. COMPETITORS ANALYSIS 39-42
2. SWOT ANALYSIS
39-40
42

CHAPTER VIII: - EXHIBITS

1. INDIAN MENU 43-48
2. SURVEY QUESTIONNAIRE
43
43-48

CHAPTER IX: - NEED FOR MCDELIVERY AND KIOSK 49-56

1. MCDELIVERY
2. KIOSK 48-52
53-56

CONCLUSION 57

BIBLOGRAPHY 58
 CHAPTER
01
INTRODUCTION
 McDonald’s

INTRODUCTION

McDonald's Corporation is the world's largest chain of fast-food restaurants.

The McDonald’s Corporation is one of the most successful global restaurant chains around
the world. They have used effective management and global expansion strategies to enter new
markets and gain a share of the foreign fast food market. McDonald’s has achieved this enormous
success, its best practices in the global food industry, international growth trends and challenges,
and various lessons that have been learned from their expansion in foreign countries. This shows
how McDonald’s creates both customer and brand loyalty for their products and services.

In 1937 Brothers Dick and Mac McDonald open a hot dog stand called the Airdrome at the
airport in Monrovia, California & in 1940 the brothers move the Airdrome building to San
Bernardino, California, where they open the first McDonald's restaurant. Although McDonald's
did not invent the hamburger or fast food, its name has become nearly synonymous with both.

The McDonald's Golden Arches logo was introduced in 1962. It was created by Jim
Schindler to resemble new arch shaped signs on the sides of the restaurants. He merged the two
golden arches together to form the famous 'M' now recognized throughout the world. Schindler's
work was a development of the stylized 'v' logo sketched by Fred Turner, which was conceived as
a more stylish corporate symbol than the Speedee chef character that had previously been used.
The McDonald's name was added to the logo in 1968.

McDonald's has its familiar golden arches logo; McDonald's has 31,886 restaurants
worldwide serving Big Macs, Chicken McNuggets, salads and French fries. Most restaurants offer
drive-thru service and some suburban locations offer outdoor playgrounds for children.
Approximately 70% of McDonald's restaurants are operated by independent franchisors. The
number of restaurants in the U.S. has reached saturation and most new McDonald's are now being
opened in Europe, Middle East and Asia.

1
 McDonald’s

In order to be a franchisee, an individual must have at least $175,000. There is about 2,400
owner/operators system wide. McDonald's is looking to boost sales by opening restaurants 24
hours a day. An estimated 30% of store revenue comes from breakfast sales. The company has
instituted a dollar menu which includes a double cheeseburger in a bid to boost sales from value-
oriented customers.
2
 McDonald’s

HISTORY

The first McDonald's restaurant was located in San Bernardino, CA in 1954 and operated
by two brothers Dick and Mac McDonald. Ray Kroc, a milk shake machine salesman, thought the
restaurant was great and purchased the rights from the brothers. Kroc opened his first McDonald's
restaurant in Des Plaines, IL in 1955 and preached cleanliness in restaurants. McDonald's would
grow quickly as it signed on franchisees to open restaurants around the country. McDonald's would
go public in 1965.

The Big Mac was introduced system wide in 1968 and was the brainchild of Jim Delligatti,
one of Ray Kroc's earliest franchisees, who by the late 1960s operated a dozen stores in Pittsburgh.
The Egg McMuffin was developed by owner operator Herb Peterson in 1973.

The site of the McDonald brothers' original restaurant is now a monument. With the
expansion of McDonald's into many international markets, the company has become a symbol of
globalization and the spread of the American way of life. Its prominence has also made it a
Frequent topic of public debates about obesity, corporate ethics and consumer responsibility.

In 2007, the company had record revenues of $22.8 billion, a 9% increase from the previous
year. Net income was $2.39 billion. McDonald's sold the Boston Market restaurant chain in 2007
and owns a stake in Chipotle Mexican Grill. In 2007, the Company completed the sale of its
businesses in Brazil, Argentina, Mexico, Puerto Rico, Venezuela and 13 other Countries in Latin
America and the Caribbean to a developmental licensee organization. An estimated 10% of all
workers have once worked at McDonald's in their lifetime.

3
 McDonald’s

FRANCHISEES

4
 McDonald’s
FRANCHISEES
Franchising refers to the methods of practicing and using another person's philosophy
Of business. The franchisor grants the independent operator the right to distribute its products,
techniques, and trademarks for a percentage of gross monthly sales and a royalty fee. Various
tangibles and intangibles such as national or international advertising, training and other support
services are commonly made available by the franchisor. Agreements typically last five to twenty
years, with premature cancellations or terminations of most contracts bearing serious
consequences for franchisees.

McDonald’s does business in more than 30,000 restaurants in 119 countries around the
world serving 47 million customers each day. In many countries around the world it does not have
a presence and its current strategy is to focus on the markets where it does not do business. No
firm date has been established for the opening of new markets. In certain markets McDonald’s
have a presence but it is not seeking franchisees and it has included instructions regarding those
markets. McDonald’s sincerely appreciate the customers expressed interest in McDonald’s and
their continued patronage of our restaurants.

MCDONALD’S INDIA
The Indian beginning
5
 CHAPTER 02
MCDONALDS IN INDIA
 McDonald’s

A 50-50 joint venture partnership between McDonald’s Corporation [USA] and two
Indian businesses, McDonald’s began its journey in India in October 1996. Connaught Plaza
Restaurants Pvt. Ltd headed by Vikram Bakshi owns and operates the northern and eastern
operation which includes restaurants in New Delhi, Uttar Pradesh, Rajasthan, Punjab, Haryana,
West Bengal etc.

Amit Jatia’s company Hardcastle Pvt. Ltd. Owns and operates McDonald’s restaurants
in West and South India. HRPL has restaurants in Maharashtra, Madhya Pradesh, Karnataka and
Andhra Pradesh, Chennai and its growing rapidly.

The head office for Hardcastle Restaurants Pvt. Is spread

across two building in Mumbai, one at Bhulbhai Desai Road and the
other at Santa Cruz. The head office houses all the support departments
required to run the restaurants in the western and southern region.
These includes:-
Construction

It is involves in all construction and design related work for the stores as per McDonald’s
standards. It prepares project plans for new stores to be put to the management and implements
the same after approval.

Country Purchase

All the purchases of raw material for restaurants products are done by the country
purchase department team for both the Delhi and Mumbai markets. It works as a national supply
chain. The main aim is to purchase the best quality material from the authorized supplier and at
lowest possible cost. Once the material is ordered by a country

Purchase it first goes to the distribution centre and then to the restaurants according to their
requirement.
6
 McDonald’s

Country Quality Assurance & Product Development

This department works closely with the country purchase department. It looks after the
quality of both raw material and of finished product. It develops new product for the menu based
on customer preference.

Finance & Information Technology

It looks after all the day to day financing accounting transaction and taxation related
activities of the application of Information Technology to the company processes.

Corporate Affairs

It associates with brand building and protection of the brands. It works closely with real
estate in doing feasibility studies for sites from a legal angle. It looks after license and liaison
activities of the company with outside agencies, i.e. regarding media

And government authority.

Legal & company Secretarial.

It helps the company sign legal deals for the new restaurants sites. It safeguards the
interest of the company and act as guardians of the company as regards to its legal functions. It
provides advisory support to the other departments as regards legal issues and ensures compliance
with applicable laws.
People Resources / Human Resources.

It conducts activities related to recruitment, selection, remuneration, retention, and

matter related to employee satisfaction.

7
Training, Learning & Development.

It is responsible for the training and Development of employees involved in operational

activity and the employees in the corporate office.
Operation

This department is responsible for the day to day functioning of the restaurants in a
profitable manner.

Marketing & Communication.

It is responsible for brand positioning increasing brand awareness and thus resulting in
increased sales. It is also responsible for advertising, media relation and implementing various
product promotion schemes like Happy Meals, Value Meals, etc.

8
 McDonald’s
Vision

Our vision is to be the world’s best quick service restaurant experience. That means that
our restaurant will be the best place for our customers to enjoy fast, friendly services …… fresh
food favorites…… a clean welcoming environment…… and a fun experience at a fair price.

OUR VALUES

Our vision is supported by a set of core values:

 We are dedicated to providing customers unparalleled levels of quality, service,

cleanliness, and value. It is what RAY KROC taught us.

 We are committed to our people because we know that a diverse team of well-trained
individuals working together is the key to our continued success.



 We approach all aspects of our business with honesty and integrity.



 We always give back to the communities in which we do business.

We celebrate our achievements, yet we are never satisfied with our results.

“To be our customer –favorite place and way to eat.”

9
 McDonald’s

CHALLENGES IN ENTERING INDIAN MARKETS

➢ Regiocentricism: Re-engineering the menu – McDonald’s has continually adapted

to the customer’s tastes, value systems, lifestyle, language and perception. Globally

McDonald’s was known for its hamburgers, beef and pork burgers. Most Indians are barred
by religion not to consume beef or pork.

To survive, the company had to be responsive to the Indian sensitivities. So McDonald’s

came up with chicken, lamb and fish burgers to suite the Indian palate.

➢ The vegetarian customer – India has a huge population of vegetarians. To cater to this
customer segment, the company came up with a completely new line of vegetarian items
like McVeggie burger and McAlooTikki. The separation of vegetarian and non-vegetarian
sections is maintained throughout the various stages.

10
 McDonald’s

SEGMENTATION, TARGETING AND POSITIONING

McDonald’s uses demographic segmentation strategy with age as the parameter. The main target

Segments are children, youth and the young urban family.

% of kids who influence what FMCG brand their

family buys

80% 71%
70% 59%
60% 52%
50%
40%
30%
20%
10%
0%
Biscuits Burgers & Pizzas Fruit Juices

As shown above, kids reign supreme in FMCG purchase related to food products. So to
attract children McDonalds has Happy Meal with which toys ranging from hot wheels to various
Walt Disney characters are given (the latest in this range is the toys of the movie Madagascar). For
this, they have a tie-up with Walt Disney. At several outlets, it also provides special facilities like
‘Play Place’ where children can play arcade games, air hockey, etc.

11
 McDonald’s

This strategy is aimed at making McDonald’s a fun place to eat. This also helps
McDonald’s to attract the young urban families wanting to spend some quality time while their
children have fun at the outlet.

To target the teenagers, McDonald’s has priced several products aggressively, keeping in
mind the price sensitivity of this target customer. In addition, facilities like Wi-Fi are also provided
to attract students to the outlets like the one at Vile Parle in Mumbai.

“Mc Donald’s Mein Hai Kuch Baat” projects McDonald’s as a place for the whole family
to enjoy. When McDonald’s entered in India it was mainly perceived as targeting the urban upper
class people. Today it positions itself as an affordable place to eat without compromising on the
quality of food, service and hygiene. The outlet ambience and mild background music highlight
the comfort that McDonald’s promises in slogans like “You deserve a Break Today” & “Feed your
inner child”. This commitment of quality of food and service in a clean, hygienic and relaxing
atmosphere has ensured that McDonald’s maintains a positive relationship with the customers.

12
 McDonald’s

Customer Perception and Customer Expectation

Customer perception is a key factor affecting a product’s success. Many potentially

revolutionary products have failed simply because of their inability to build a healthy perception
about themselves in the customers’ minds. McDonalds being an internationally renowned brand
brings with it certain expectations for the customers.

Target Segment What is McDonald’s for me?

A Family with children A treat to children, a fun place to be for the children.
Urban customer on the move Great taste, quick service without affecting the work schedule
Teenager Hangout with friends, but keep it affordable.

Customers expect it to be an ambient, hygienic and a little sophisticated brand that respects their
values. The customer’s expect the brand to enhance their self-image. Customer responses obtained
at the Vile Parle, Mumbai outlet confirmed the fact that they connect strongly with the brand.
However, fulfilling some of the customer expectations like a broader product variety provide
McDonald’s a great scope for improvement.

13
 McDonald’s

McDonaldizing the Suppliers

SUPPLY CHAIN
Supply Chain is one of the critical factors for the smooth functioning of any business. And
when we are talking about fast food business with McDonald’s as the subject of the study it can
expected a Supply Chain model of one of the highest precisions. It is this unmatched Supply Chain
Structure, which not just ensures on time delivery of raw materials and supplies to McDonalds but
also enables it to cut down on its cost and maximize profitability along with maintaining highest
quality standards of its products. The level of commitment of McDonalds can be gauged from the
fact that even before it set up its first restaurant in the country it infused Rs 400 Crore to set up its
delivery mechanism. McDonald’s initiative to set up an efficient

Supply chain and deploy state-of-art technology changed the entire Indian fast food industry
and raised the standards of performance to international levels.

As already mentioned, McDonalds had been working on its supply chain even before
it opened its first joint in the country. McDonalds, an international brand which was trying to
make inroads into the country, developed its Indian partners in such a manner that they stayed
with the company from the beginning. The success of McDonalds India was achieved by
sourcing all its required products from within the country. To ensure this, McDonalds
developed local businesses, which can supply it highest quality products. Today, McDonalds
India works with 38 different suppliers on a long term basis and several other stand alone
restaurants for its various other requirements. McDonald’s distribution centers in India came
in the following order: Noida and Kalamboli (Mumbai) in 1996, Bangalore in 2004, and the
latest one in Kolkata (2007). McDonald’s entered its first distribution partnership agreement
with Radha Krishna Foodland, a part of the Radha Krishna Group engaged in food-related
service businesses.

14
 McDonald’s

The association goes back to July 1993, when it studied the nuances of McDonald’s
operations and requirements for the Indian market. As distribution centers, the company was
responsible for procurement, the quality inspection programme, storage, inventory
management, deliveries to the restaurants and data collection, recording and reporting.

Value-added services like shredding of lettuce, re-packing of promotional items

continued since then at the centers playing a vital role in maintaining the integrity of the
products throughout the entire 'cold chain'.

Cold Chain was one of the unique concepts of McDonalds supply chain in India, on
which it had spent more than six years to get the system into place. This system brought about
a veritable revolution, immensely benefiting the farmers at one end and enabling customers
at retail counters get the highest quality food products, absolutely fresh and at great value.
Through its unique cold chain, McDonalds has been able to both cut down on its operational
wastage, as well as maintain the freshness and nutritional value of raw and processed food
products. This has involved procurement, warehousing, transportation and retailing of
perishable food products, all under controlled temperatures. The following list of suppliers,
who build up the major supply chain of McDonalds, reveal how this ‘Cold Chain’ works and
contributes towards the efficiency of McDonalds.

15
 McDonald’s
Dynamix Dairy Industries (Supplier of Cheese

Dynamix has brought immense benefits to farmers in Baramati, Maharashtra by setting up a

network of milk collection centres equipped with bulk coolers. Easy accessibility has enabled
farmers augment their income by finding a new market for surplus milk. The factory has:

 Fully automatic international standard processing facility.


 Capability to convert milk into cheese, butter/ghee, skimmed milk powder, lactose, casein
& whey protein and humanized baby food.

 Stringent quality control measures and continuous Research & Development

From farm two degrees Celsius in 90 minutes is the first step to quality. For example, the Rs
262-crore Dynamix Dairy Industries, located in Baramati in Pune district of Maharashtra,
manufactures cheese slices for McDonald’s at 10 metric tone per month

. Dynamix has helped set up 15 bulk cooling centers throughout the district from which it
purchases milk. Each cooling centre, which is equipped with modern measuring and Testing
equipment and a large cooling tank, is not more than a few kilometers away from local dairy farms.
A farmer can deliver milk even twice a day on his bicycle and get a printed receipt on the spot,
which also lists the quality of the milk supplied by him as per fat content, colour and solids content.

If the milk is sub-standard or adulterated, it is rejected on the spot. A batch of milk can
vary from one litre to 10 liters, or more. Each batch is mixed in one large stainless steel cooler and
chilled immediately to two degrees Celsius to stop bacterial growth and preserve freshness.

16
McDonald’s
 From this point onwards, until just before the burger is actually served in a McDonald’s
restaurant hundreds of kilometers away, the temperature is never allowed to increase.

When the refrigerated milk arrives at the Dynamix plant at Baramati, the milk in every
single tanker is thoroughly tested and rejected if found sub-standard, adulterated or contaminated.
The sophisticated testing lab can check fat content with an accuracy of 0.1 per cent. It can even
detect minute traces of pesticides or antibiotics administered to cows.

This instant feedback and the rejection of the entire tanker-load forces farmers to follow
the best practices in terms of animal husbandry, use proper feeds, cut down on the indiscriminate
use of pesticides and animal medicines and completely stop even the slightest attempts at
adulteration.

17
 Trikaya Agriculture (Supplier of Iceberg Lettuce)

Implementation of advanced agricultural practices has enabled Trikaya to successfully grow

specialty crops like iceberg lettuce, special herbs and many oriental vegetables. Farm infrastructure
features:

 A specialized nursery with a team of agricultural experts.


 Drip and sprinkler irrigation in raised farm beds with fertilizer mixing plant.

 Pre-cooling room and a large cold room for post-harvest handling.

 Refrigerated truck for transportation.

Trikaya Agriculture, a major supplier of iceberg lettuce to McDonald's India, is one such
enterprise that is an intrinsic part of the cold chain. Exposure to better agricultural management
practices and sharing of advanced agricultural technology by McDonald's has made Trikaya
Agriculture extremely conscious of delivering its products with utmost care and quality.

Initially lettuce could only be grown during the winter months but with McDonald's expertise
in the area of agriculture, Trikaya Farms in Talegaon, Maharashtra, is now able to grow this crop
all the year round. McDonald's has provided assistance in the selection of high quality seeds,
exposed the farms to advanced drip-irrigation technology, and helped develop a refrigerated
transportation system allowing a small agri-business in Maharashtra to provide fresh, high-quality
lettuce to McDonald's urban restaurant locations thousands of kilometers away. Post-harvest
facilities at Trikaya include a cold chain consisting of a pre-cooling room to remove field heat, a
large cold room and a refrigerated van for transportation where the temperature and the relative
humidity of the crop is maintained between 1º C and 4º C and 95% respectively.

18
 McDonald’s

Vegetables are moved into the pre-cooling room within half an hour of harvesting. The pre-
cooling room ensures rapid vacuum cooling to 2º C within 90 minutes.

The pack house, pre-cooling and cold room are located at the farms itself, ensuring no delay
between harvesting, pre-cooling, packaging and cold storage. With this cold chain infrastructure
in place, Trikaya Agriculture has also a plan to export this high value product to other international
markets, especially to McDonald's Middle East and Asia Pacific operations.

McDonald's expertise in packaging, handling and long-distance transportation has helped

Trikaya to do trial shipments to the Gulf successfully.

In addition to export, McDonald's assistance has enabled Trikaya Agriculture to supply this
crop to a number of star-rated hotels, clubs, flight kitchens and offshore catering companies all
over India.

19
 McDonald’s

Vista Processed Foods Pvt. Ltd. (Supplier of Chicken and Vegetable range of
products including Fruit Pies)
A joint venture with OSI Industries Inc., USA, McDonald's India Pvt. Ltd. and Vista
Processed Foods Pvt. Ltd., produces a range of frozen chicken and vegetable foods. A world class
infrastructure at their plant at Taloja, Maharashtra, has:
 Separate processing lines for chicken and vegetable foods.

 Capability to produce frozen foods at temperature as low as -35 Degree Celsius. To retain
total freshness.

 International standards, procedures and support services.

Vista Processed Foods Pvt. Ltd., McDonald's suppliers for the chicken and vegetable range
of products, is another important player in this cold chain. Technical and financial support
extended by OSI Industries Inc., USA and McDonald’s India Private Limited have enabled Vista
to set up world-class infrastructure and support services. This includes hi-tech refrigeration plants
for manufacture of frozen food at temperatures as low as - 35° C. This is vital to ensure that the
frozen food retains it freshness for a long time and the 'cold chain' is maintained. The frozen
product is immediately moved to cold storage rooms. With continued assistance from its
international partners, Vista has installed hi-tech equipment for both the chicken and vegetable
processing lines, which reflect the latest food processing technology (de-boning, blending,
forming, coating, frying and freezing). For the vegetable range, the latest vegetable mixers and
blenders are in operation. Also, keeping cultural sensitivities in mind, both processing lines are
absolutely segregated and utmost care is taken to ensure that the vegetable products do not mix
with the non-vegetarian products. Now, at Vista, a very wide range of frozen and nutritious chicken
and vegetable products is available. Ongoing R&D, both locally and in the parent companies, work
towards innovation in taste, nutritional value and convenience. These products, besides being
supplied to McDonald's, are also offered to institutions like star-rated hotels, hospitals, project
sites, caterers, corp, corporate canteens, schools and colleges, restaurants, food service
establishments and coffee shops. Today, production of better quality frozen foods that are both
nutritious and fresh has made Vista Processed Foods Pvt. Ltd. a name to reckon within the industry.
20
 McDonald’s

Radhakrishna Foodland (Distribution Centres for Delhi and Mumbai)

An integral part of the Radhakrishna Group, Foodland specializes in handling large volumes,
providing the entire range of services including procurement, quality inspection, storage, inventory
management, deliveries, data collection, recording and reporting. Salient strengths are:

 A one-stop shop for all distribution management services.


 Dry and cold storage facility to store and transport perishable products at temperatures up
to -22 Degree Cel.

 Effective process control for minimum distribution cost.
McDonald's local supply networks through Radhakrishna Foodland, which operates
distribution centres (DCs) for McDonald's restaurants in Mumbai and Delhi. The DCs have
focused all their resources to meet McDonald's expectation of 'Cold, Clean, and On-Time Delivery'
and plays a very vital role in maintaining the integrity of the products throughout the entire 'cold
chain'. Ranging from liquid products coming from Punjab to lettuce from Pune, the DC receives
items from different parts of the country. These items are stored in rooms with different
temperature zones and are finally dispatched to the McDonald's restaurants on the basis of their
requirements. The company has both cold and dry storage facilities with capability to store
products up to -22º C as well as delivery trucks to transport products at temperatures ranging from
room temperature to frozen state.

Amrit Food (Supplier of long life UHT Milk and Milk Products for Frozen
Desserts)
Amrit Food, an ISO 9000 company, manufactures widely popular brands –
Gagan Milk and Nandan Ghee at its factory at Ghaziabad, Uttar Pradesh.
The factory has:
 State-of-the-art fully automatic machinery requiring no human contact with product, for
total hygiene.

 Installed capacity of 6000 ltrs/hr for producing homogenized UHT (Ultra High
Temperature) processed milk and milk products.

 Strict quality control supported by a fully equipped quality control laboratory.

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All suppliers adhere to Indian government regulations on food, health and hygiene while
continuously maintaining McDonald's recognized standards. As the ingredients move from farms
to processing plants to the restaurant, McDonald's Quality Inspection Programme (QIP) carries out
quality checks at over 20 different points in the Cold Chain system. Setting up of the Cold Chain
has also enabled it to cut down on operational wastage

Hazard Analysis Critical Control Point (HACCP) is a systematic approach to food safety
that emphasizes prevention within its suppliers' facility and restaurants rather than detection
through inspection of illness or presence of microbiological data. Based on HACCP guidelines,
control points and critical control points for all McDonald's major food processing plants and
restaurants in India have been identified. The limits have been established for those followed by
monitoring, recording and correcting any deviations. The HACCP verification is done at least
twice in a year and certified.

The relationship between McDonald's and its Indian suppliers is mutually beneficial. As
McDonald's expands in India, the supplier gets the opportunity to expand his business, have access
to the latest in food technology, exposure to advanced agricultural practices and the ability to grow
or to export. There are many cases of local suppliers operating out of small towns who have
benefited from their association with McDonald's India

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 McDonald’s

CHAPTER
04
MARETING MIX
 McDonald’s
MCDONALDS MARKETING MIX (5 P’S)
After segmenting the market, finding the target segment and positioning itself, each
company needs to come up with an offer. The 5 P’s used by McDonalds are:

1. Product

2. Place

3. Price

4. Promotion

5. People

Product: How should the company design, manufacture the product so that it enhances the
customer experience?

Product is the physical product or service offered to the consumer. Product includes certain
aspects such as packaging, guarantee, looks etc. This includes both the tangible and the non-
tangible aspects of the product and service

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 McDonald’s

McDonalds has intentionally kept its product depth and product width limited. McDonalds
studied the behavior of the Indian customer and provided a totally different menu as compared to
its International offering. It dropped ham, beef and mutton burgers from the menu. McDonald's
success worldwide has been attributed to the ‘“Think Global, Act Local and Sell like a Retailer”
philosophy. McDonald’s followed this international mantra while opening doors to the Indian
subcontinent. With respect to the cultural and traditional sentiments, not only did McDonalds not
serve it’s most popular product The BIGMAC (a beef burger) but also developed an egg-less
mayonnaise for the first time in the worldwide system.

To suit the Indian palette, the McAloo Tikki™ burger, Veg. Pizza McPuff™ and Chicken
McGrill™ burger were among other offerings that were formulated and introduced using spices
favored by Indians. Furthermore, each restaurant kitchen was designed to maintain separate
Vegetarian and Non-Vegetarian food counters.

Reasons for introducing the products

 Beef which was a taboo in the Indian market was planned to replace by filling of Aloo
Tikki to match up with the Indian culture.
 Salad sandwich was introduced targeting the people who are more conscious about health.
 The introduction of jain salad in the outlet keeping the Jain people rituals of not eating
ginger, onion, potatoes etc.
 Seeing to the Indian mentality of having wheat chapattis led to the idea to introduce paneer
salsa wrap and chicken Mexican wrap.
 Filet-o-fish was introduced keeping in mind the demand of the sea food lovers having no
competitors in the segment before.

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 McDonald’s

Place: where should be the product available and the role of distribution channels

The place mainly consists of the distribution channels. It is important so that the product is
available to the customer at the right place, at the right time and in the right quantity. Nearly 50%
of U.S.A is within a 3 minute drive from a McDonald’s outlet.
There is a certain degree of fun and happiness that a customer feels each time he dines at
McDonalds. There are certain value propositions that McDonalds offer to its customers based on
their needs. McDonalds offers hygienic environment, good ambience and great service. Now
McDonalds have also started giving internet facility at their centres and they have been playing
music through radio instead of the normal music. There are certain dedicated areas for children
where they can play while their parents can have some quality time together.
Price: What should be the pricing strategy?

Pricing includes the list price, the discount functions available, the financing options available etc.
It should also take into the consideration the probable reaction from the competitor to the pricing
strategy. This is the most important part of the marketing mix as this is the only part which
generates revenue. All the other three are expenses incurred. The price must take into consideration
the appropriate demand-supply equation.
McDonalds has certain value pricing and bundling strategies such as happy meal, combo meal,
family meal etc. to increase overall sales volumes.

Branded Affordability: Having established the image of

comfort and familiarity, it now was

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 McDonald’s

Time to add new people to the fold. The Indian consumers continued to perceive McDonald’s as
an expensive eating out option. The challenge was to overcome this perception and be accepted as
an affordable brand. While the patented products like McVeggie™ and McChicken™ continued
to cater to the patrons, the company needed to broaden the audience base to further entrench into
the market.

McDonald’s found success in its strategy of Branded Affordability and

introduced the ‘Happy Price Menu’ of Rs.20/-. Engaging and Memorable
campaigns were created to establish the Branded Affordability
communication -The ‘Bahanas’, the yesteryears prices, or ‘bees mein full
dhamal’!

Promotion: What is the suitable strategy and channels for promotion of the product?

The various promotion channels being used by McDonald’s to effectively communicate

the product information are given above. A clear understanding of the customer value helps decide
whether the cost of promotion is worth spending.

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 McDonald’s

There are three main objectives of advertising for McDonald’s are to make people aware
of an item, feel positive about it and remember it. The right message has to be communicated
to the right audience through the right media. McDonald’s does its promotion through television,
hoardings and bus shelters. They use print ads and the television programs are also an important
marketing medium for promotion.

Some of the most famous marketing campaigns of McDonald’s are:

 “You Deserve a break today, so get up and get away- To McDonald’s”

 “Aap ke zamane mein, baap ke zamane ke daam”.

 “Food, Folks, and Fun”

 “I’m loving it”.

Familiarity breeds’ comfort:

The first step for the brand was to establish itself as a familiar,
comfortable place. Taking a cue from the Indian family values, the year
2000 saw the first ever McDonald’s ad aired in the country. A child,
who is unable to recite a poem and suffers stage fright, but when he
enters McDonald’s, he easily recites it when in the comfortable familiar
environment of McDonalds.

Working on the insight – similarly when his family moves into a new place, the child
misses all that has always been so familiar and dear. He then has the comfort of something that is
dear and familiar to bring a smile to his face. McDonald’s was successful in creating an image of
a warm and comfortable ambience through its

Ads. ‘McDonald’s Mein Hai Kuch Baat’: Making McDonalds the consumers’ favorite place and
way to eat. While kids and families were key, it was also important to talk to the generation that
had not grown up on McDonald’s burgers and fries. An adult who works with logic and

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 McDonald’s

Reasoning would need a reason tempting enough. And what better way to talk to them than talk
about McDonald’s core competence – food!

Even in Dreams:

McDonald’s realized that the way to draw more consumers would be to increase the
visibility of the brand and its products. The more a person saw food, the greater his urge would be
to try it out. The company came up with its next round of campaign to address and reflect this. The
campaign showed different people dreaming about McDonald’s. It depicted how the consumers
were totally involved with McDonald’s and the food. New product stories delivered in a
memorable and engaging approach. It was imperative for the success of the brand to be
‘Indianized’ – to continuously speak to consumers in their ‘language’ without taking away from
its core American parentage. ‘From tears to smiles’ - campaigns were produced to introduce new,
scrumptious products.

Let go the child within you:

The general brand perception of McDonald’s in India was that of a place for kids. While
the campaigns had worked in the past, targeting kids, McDonald’s recognized the fact that it could
not always depend on the kids’ niche. When kids move up the consumption chain, there is a
possibility of losing out on consumers. Moreover, the family outings with children only happen
over the weekends and holidays. It was imperative to rope in adults who would patronize the brand
over the weekends. Consequently, the next series of campaigns were targeted to drive in adult
traffic to break away from the perception. The ad depicted a father being invited to a birthday party
at McDonald’s. He is not at ease with the idea of visiting McDonald’s since he perceives it as a
kids place. His child reminds him of the McCurry Pan™, Filet-o-Fish™ that he would be able to
relish at the birthday party. The food boosts the father to go to the party, where to his astonishment
is his boss’ party. The ad asserted that people celebrate birthdays and occasions at places they are
comfortable in!

People: How to converge the benefits of internal and external marketing?

McDonald’s understands the value of both its employees and its customers. It understands
the fact that a happy employee can serve well and result in a happy customer.
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McDonald continuously does Internal Marketing. This is important as it must precede external
marketing. This includes hiring, training and motivating able employees. This way they serve
customers well and the final result is a happy customer.

The level of importance has changed to be in the following order (the more important people are
at the top):

1. Customers

2. Front line employees

3. Middle level managers

4. Front line managers

The punch line “I’m loving it” is an attempt to show that the employees are loving their work at
McDonalds and will love to serve the customers.

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CHAPTER
O5
MC EMPLOYEES
 McDonald’s

MC EMPLOYEES

Employee benefits

MC DONALD’S provides you with many opportunities to talk to your management on

any topic related to your employment/work. To begin with we follow an “open door” policy
Which means that all team members at MC DONALD’S are approachable at any time. Crew
meetings are held every month in your restaurant where all the store related issues are discussed.
Besides this you will also have rap session and meet 5 where you can express your view
candidly.

RAP SESSION:-

Rap session are small informal discuss between crew and management for the purpose of
discussing ideas, suggestions and problems. These sessions will be held about once every three
months or whenever needed by the store manager or a member of the management team. Rap
sessions are an opportunity for the crew to make their views known to the company. You will be
paid for attending a rap session.

Opinion survey:-

About once a year we will ask all employees to complete a confidential

questionnaire relating to their work and the operation of the store, the answers will help us to
improve our management of the restaurant and conditions of employment.

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Open door policy:-

Should an employee have questions about the contents of their handbook or

have any basis for concern about any work conditions the management team’s office door is always
open for private discussion. Employees should be encouraged to use this “open door policy”
whenever they wish. Likewise, operations/human resources manager encourage you to use the
open door policy if you have a concern unresolved by your immediate supervisor.

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 McDonald’s

Facilities

Crew room

This room is provided for the employee for recreation and rest during the break time. The
employee can study, listen to music, and get trained in this room.

Breaks

It is not easy to maintain quality, service, and cleanliness. It take hard work and hustle. To keep
energy level high, all the crew member working above five consecutive hour are eligible for an
unpaid break of an hour.

Employee Meal

One of the best things about working for McDonald’s is for food. Employees can enjoy quality
nutritious food at world standard hygiene levels. It is free to managers and crew. All the meals
consumed must be recorded and consumed in the restaurants itself.

Locker Facility

Lockers are available for the employees use at the restaurants for keeping the personal
belongings in a safe and secure place during the shift.

Other Facilities
In addition to the above facilities the employee also enjoys with the team member during the
yearly store outing and various inter-store activities arranged system-wise and patch wise. These
activities are fun and provide opportunity to have a good time and know fellow employees better

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Employee recognition
Incentives
All the crew at McDonald’s have the opportunity to get McDonald’s branded
merchandise. Each restaurant is allotted “Mahabucks” every month based on monthly store
allocation and various inter-store competitions. Mahabucks is a crew incentive programme where
the Mahabucks coupons can be redeemed for the set of utility items available for that year.

The employee have the opportunity to earn the Mahabucks by becoming face of the
month, face of the quarter, various rewards organized by the stores and through various inter store
competitions.

Employee Referral Programme

The employee can refer any friend who is interested in working at McDonald’s for a crew
member’s job at any of the McDonald’s store. The employee receives an incentive after the
referred crew member completes 3 months in the organization.

Graduate Career Advancement Programme

McDonald’s believe that investing in the people is one of the best ways to build the brand
and assure customer loyalty. Crew Member who completes their graduation are recognized for
their academic growth by putting them on training programme which help them to become
manager faster.

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Retirement Benefits

Employee provident fund

All the employee are eligible for the provident fund scheme as per the company’s rule.
Provident fund is a retire benefit provided to every employee of McDonald’s. Every employee
contribute 12% of his basic salary to his/her PF account. There is an equal contribution by the
Employer.
However 8.33% of the employer’s contribution is deposited to the Employee’s Pension
Fund and the rest goes to the Provident Fund.

Employee State Insurance

All the crew member are eligible for the Employee State Insurance as per the ESI rule. This
benefit is provided to the employee for free medical treatment in case of sickness, maternity, and
employment injury. The employee contribute 1.75% of his gross salary whereas the employer
contributes 4.75%

Bonus

Depending upon the law applicable at the relevant time the employee will receive an
amount of 8.33%of the basic salary earned during the financial year.

Gratuity

All the full time employee who have completed 5 years of continuous employment with
the company are eligible for gratuity. The employee will receive an amount of 15 days basic salary
for every week worked. The amount is given at the time of separation or retirement from the
company.
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 McDonald’s

Employer. However 8.33% of the employer’s contribution is deposited to the Employee’s Pension
Fund and the rest goes to the Provident Fund.

Employee State Insurance

All the crew member are eligible for the Employee State Insurance as per the ESI rule. This
benefit is provided to the employee for free medical treatment in case of sickness, maternity, and
employment injury. The employee contribute 1.75% of his gross salary whereas the employer
contributes 4.75%

Bonus

Depending upon the law applicable at the relevant time the employee will receive an
amount of 8.33%of the basic salary earned during the financial year.

Gratuity

All the full time employee who have completed 5 years of continuous employment with
the company are eligible for gratuity. The employee will receive an amount of 15 days basic salary
for every week worked. The amount is given at the time of separation or retirement from the
company.

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 McDonald’s

CHAPTER
06
MCDONALD’ S IN
SERVICE INDUSTRY
 MCDONALD’ S IN SERVICE INDUSTRY

THE MCDONALD’S EXPERIENCE

Marketing in a services industry is becoming an increasingly complex challenge. The

paradigms of service marketing demand a passionate understanding of customer expectations and
perceptions, and linking them to product design & delivery as well as operational planning. This
is where McDonald’s has excelled due to its ability to successfully integrate the customer’s
perspective in its products and operations in a comprehensive manner. The revamped menu in
India is an example of McDonald’s strategy of integrating the customer’s perspective in its
products. And, the operational integration is evident from McDonald’s emphasis on its suppliers
as its customers as well as its treatment of its consumers as co-producers of services.

The ultimate aim of Service Marketing is not just to become a Service Leader but to create a
Service Brand. The Service Delivery Process is the key to achieving this aim of Service Marketing.
Service Delivery
Process

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 McDonald’s

During the Service Delivery Process, each moment of interaction between the firm and the
customer, called “Moments of Truth”, helps understand the opportunities that a firm has to win
or lose the customer. For example, these “moments of truth” are created for McDonald’s every
time the guard at the McDonald’s outlet meets the customer, every time an attendant takes down
the order from the customer waiting in the queue, every time the cashier interacts with the
customer, every time the attendant helps the customer guided the customer towards the table, every
time the attendant cleans the tables etc.

“Moments Of Truth” – The Service Encounter

Service Provider Service Delivery Points

Managing these “moments of truth” is a great challenge in Service Marketing especially

due to customer’s involvement as a co-producer of services (e.g. McDonald’s self-service concept
wherein the customer not only collects the order but also cleans the table after consuming the
food). However, McDonald's has been able to create a great experience for its customers by
understanding the nature of the entire Service Delivery

Process and the various stages in the process that are exposed to the customers.
Transparency in the processes at its outlet has helped McDonald’s bring the back office in its

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 McDonald’s

Outlet at the front so that the customer is able to know the operations and provide feedback on
service design improvements.

Internal Customer Focus is equally important as External Customer Orientation in order to

win these “moments of truth”. McDonald’s focus on its People and their service delivery methods
therefore plays a very important role in creating a successful Service Brand. The quality and the
consistency of the service delivered by McDonald’s have been greatly enhanced by the
combination of the factors mentioned above. This has helped McDonald’s become Service Leader
and a successful Service Brand. This is evident from the fact that very few of its customers opt for
take-home parcels or home deliveries while most of them prefer to eat at the outlet and enjoy the
McDonald’s experience.

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 McDonald’s

IMPORTANCE OF PLC IN MCDONALDS

The requirements of customers change over time and thus the product offering has to be
changed accordingly. What is the fashion today may be out of market within few weeks. Thus
continuous innovation is required.

To counter these changes McDonalds has continuously introduced new products and has phased
out the old ones which were at the decline stage of their PLC. The introduction is timed such that
the new product does not cannibalize the product already in the maturity or growth stage. Thus the
secret lies in getting profits with different products in the different stages of the PLC.

A perfect example of revitalizing a product in decline phase

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 McDonald’s

The French Fries have been an important part of the McDonalds menu worldwide. But
now it was in the stage of decline and was actually not generating proper return. In an attempt to
revitalize it, a new variant was introduced namely Shake Shake Fries. This is being served with
chatpata spice mix which has resulted in increase in the sales of French Fries and has elevated it
from to the decline stage. This is used to delay the decline of a well-established product which has
the potential of generating further revenue.

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CHAPTER
07
ANALYSIS
 ANALYSIS

Competitors Analysis

McDonald’s has been a leading fast-foods outlet in Vile Parle. But the outlet understudy has other
competitors eating away into its market share. In addition to its traditional rivals—KFC, Dominos,
Pizza Hut—the firm encounters new challenges. Jumbo King competes using a back-to-basics
approach of quickly serving up burgers for time-pressed consumers. On the higher end, the KFC
has become potent competitor in the quick service field, taking away customers from McDonald’s.
Perhaps in the new environment, fast, convenient service is no longer enough to distinguish the
firm. At this time, a new critical success factor may be emerging: the need to create a rich,
satisfying experience for consumers. This brings us to service and experience based competition
which McDonald’s can use for competitive advantage against Jumbo King. Keeping in mind the
demographics of the area, McDonald’s has Wi-Fi enabled the outlet to cater to the student
community. It is for this overall “Food, Fun & Folks” experience that customers pay a premium
over the other competitors.

Competition also reduces product lifecycle; inducing firms to revise their products portfolios
and to revisit their product market to understand changing needs, expectations and perception of
different market segments. The new McBreakfast would be introduced between 6 to 11 am as a
pilot project. This would open up a whole new revenue stream for McDonald’s by tapping into the
student and working population by providing a healthy and wholesome breakfast. This shows how
demographic shift can affect the demand for products and services. McDonald’s has anticipated
these changes to maintain its competitive edge.

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 McDonald’s

Two Dimensional Perceptual Mapping

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 McDonald’s

SWOT Analysis

The Road Ahead

➢ Entry to Tier 2 and Tier 3 cities – The main target customer for McDonald’s is the new
urban Indian family. With the customer demographics constantly changing and tectonic
social and cultural shifts being observed in Tier 2 and Tier 3 cities due to globalization, the
company is now expanding to Tier 2 cities like Pune and Jaipur.

➢ Rolling out McBreakfast across all outlets – In India, the company has recently launched
its entry into the breakfast food category. This is now launched on a pilot basis on select
stores. In Mumbai, it available at the Vile Parle outlet. The company views this category
as a key growth driver in future.

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 McDonald’s

CHAPTER
07
EXHIBTS
Exhibits

1. McDonald’s Indian Menu

Vegetarian Non Vegetarian

McVeggie Chicken Maharaja Mac
McAlooTikki McChicken Burger
Paneer Salsa Wrap Chicken Nuggets
Salad Sandwich Wrap Chicken Mexican
Potato Wedges Fillet-O-Fish
Pizza McPuff

Survey Questionnaire
Q. Which is your favorite product at McDonald’s?

Q. Is the product line in McDonald’s adequate?

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Q. What is the main problem you faced at McDonald’s?

Q. Which area do you think needs the most improvement?

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 McDonald’s

Q. What is the first thing that strikes your mind about McDonald’s?

Kids playing at McDonalds Vile Parle

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 McDonald’s

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 McDonald’s

THE NEW BREAKFAST MENU STARTED AT SELECT STORES IN MUMBAI.

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 McDonald’s

The Business Need for Delivery & kiosk

McDelivery and Kiosks are two integral factors in the McDonalds

growth model.
48
 McDonald’s

CHAPTER
09
Mc DELIVERY
 McDonald’s

McDELIVERY

“If you can’t come to McDonalds, McDonalds will come to you.”

After nearly sixteen years in India, McDonald's finally started coming to your doorstep. The key
idea is convenience. We are a quick service restaurant available at high-traffic locations. But there
is a large number of people who find it difficult to travel. The key is to deliver hot and fresh food.
Why McDelivery is an Important Business model?

• McDelivery is one of the Important Business models of Brand extensions.

• McDelivery contributes to around 7.5 % of Total sales.
• The key idea is Convenience because McDonalds believe in being accessible.
• By offering home delivery we can reach out to the Customers and increase our penetration.
• MDS SOI contribution to the store system wise is 15.30%.
• Based on the Data it is presumed that in the Coming days the contribution of McDelivery
will be on increasing trend.
• Current number of MDS Stores – 36
Plan by end of 2009 - 46 MDS stores
Analysis shows that the Sales Trend is continuously on increasing Trend.
 In 2008 Regrading phase was done because of which TC’s for 2008 Were impacted
Compared to 2007 but now again there is an Increasing trend.
 In 2007 – 27 MDS
In 2008 – 34 MDS

In 2009 - 40stores
In 2010 – 100 stores
In 2012- 150 stores
In 2014 celebrating 200 stores
Till now it 300 stores
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 McDonald’s

In 2007 Sales ended 8,31,98,038

 In 2008 Sales ended – Rs.9,05,83,754/-


 SOI Contribution Figures positive.

2008 2009 plan Feb Y

MDS GM% 56.67% 57.6% 55.9
Lab Cost% 12.99% 12.7% 12.1
Outside Services% 16.69% 13.1% 15.4
PAC% 14.61% 18.6% 16.6
SOI% 12.95% 12.8% 15.3

, The chain which entered India with its maiden store in 1996 in Delhi saw its store count grown
from around 100 in 2006 to over 300 at the end of FY13. McDonald’s W & S which had a little
less than half of the stores in FY07 overtook McDonald’s N & E in the number of outlets in FY12
when it added around 23 outlets, the highest in a single year till then and almost double of what
McDonald’s N & E did in that year, according to sources
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 McDonald’s

Interestingly, the outperformance of McDonald’s W & S coincided with change in operational

ownership. FY12 was also the first year after a change in business structure where the Jatias
acquired the stake held by McDonald’s in their joint venture HRPL while retaining their role as a
master franchisee for two regions of the country. Jatias recently consolidated HRPL under a
small public listed firm Westlife Development.

To be fair, McDonald’s N & E reached break-even faster than its other Indian peer. Connaught
Plaza Restaurants clocked positive EBITDA way back in FY08, one year ahead of Hardcastle
Restaurants. It also clocked net profit one year before Hardcastle, in FY10. While faster rollout
of new stores in FY11 and FY12 allowed Jatias to gain speed, McDonald’s N & E matched the
new addition to stores last year with around 30 new outlets the same as McDonald’s W & S. Few
weeks ago it also set up the single largest McDonald’s outlet in the country in Noida.

Amit Jatia, vice-chairman of Westlife Development, did not comment specifically about the
financial revenues but shared that McDonald’s W & S added 60 restaurants over the past two
years, taking the count up from 107 restaurants in FY11 to the current 166 restaurants (as of June
30, 2013) as the company moved into an acceleration phase and the business has grown
significantly.

A consultant with one of the Big Four firm, on condition of anonymity said, he believe that
going forward, Hardcastle (McDonald’s W & S) will do a better job and there will be rapid
expansion by them due to the funds that the company has recently raised.”

Westlife recently raised Rs 180 crore from Arisaig Partners, an asset management firm which
chases investments in public-listed consumer-facing companies.

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 McDonald’

The consultant further added that real estate cost has gone up for quick service restaurants
(QSRs) and one needs to be well funded to expand and thus Jatias are in a better position to scale
up.

In February this year, according to Amit Jatia, that the firm is planning to increase the number of
outlets in McDonald’s W & S to 250 by 2014. “Typically, we invest Rs 3 crore per restaurant
plus there is the cost of real estate. Hence, we plan to spend around Rs 400-500 crore in the next
two years,” said Jatia.

A stock analyst who tracks consumer sector said, “The last two years have definitely been a
game changer of McDonald’s in India with the brand (franchisees) started making profits despite
heavy competition in the QSR space. In such a scenario, having an organizational structure like
Hardcastle has definitely helped. The franchisee now has solely Indian top management which
has led to faster decision making and scaling up. The restructuring to bring it under a listed firm,
which is as good as a reverse listing, too has helped the company to raise funds.”

Strategy for future

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 McDonald’s

McDONALD’s KIOSK

At McDonalds we have made effort to cover every possible area for serving to the Customer needs.
After serving the meals we have made Kiosk as a means of fulfilling the custom of something
sweet following the main course.

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Why KIOSK is an Important Business model?

 Kiosk is one of the important model of Brand Extensions.


 Kiosk is a Business model which requires comparatively less initial investment.

 Also it helps us to increase the number of Guest Counts and Sales.

 It is a way of extending our Brand with overall less Initial and Operating investments.

 Kiosks helps us to give varied choices to our Customers

 Kiosks contribute around 3.7% of our Total Sales.

 Kiosk provides 23% of positive SOI.

 IN 2009 we have 25 Kiosks and plan it has reached

Sales Contribution from New Business Models Kio

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 McDonald’s

 As per the Analysis the Trend of Sales of Kiosk seems to be

on increasing terms.

 In 2007 – 14 Kiosks
In 2008 – 22 Kiosks

In 2009 (Plan)-28 Kiosks In
2009(Till data)-25 Kiosks

McDonald's is rolling out self-service kiosks in restaurants across the US that allow
customers to order and pay for their food without ever having to interact with a human

The touch-screen technology is meant to speed up the ordering process and give people
more control over customizing their food, while reducing opportunities for human error
according to the company

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 McDonald’s

Global quick service restaurant Major McDonald’s, which launched its store-in-store format
McCafe in India 18 months ago, is planning to cash in on the growing popularity of coffee
drinking in the country. McCafe is the third line of McDonald's business in India, after
breakfast (the home delivery), and kiosk formats.

McCafe has now been launched in South India with the first outlet being opened in
Bengaluru. As of now there are over 15,000 restaurants that sell the McCafe products
globally.

“The in-store format enables a quick roll-out of a McCafé with an investment of Rs 30-35
lakh per outlet across key trading areas in metro cities of West and South India. Within a
span of 18 months we have expanded our McCafé network across 41 restaurants in six cities
— Mumbai, Ahmedabad, Nashik, Aurangabad, Pune and Bengaluru. Today, we are well on
track to launch over 100 McCafés over the next four years,” said Smita Jatia, managing
director — Hardcastle Restaurants Pvt Ltd, in Bengaluru on Monday. Hardcastle Restaurants
is McDonald's master franchise in the western and southern markets.

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 McDonald’s

CHAPTER
10
CONCLUSION
 CONCLUSION
“The in-store format enables a quick roll-out of a McCafé with an investment of Rs 30-
35 lakh per outlet across key trading areas in metro cities of West and South India. Within a
span of 18 months McDonald’s have expanded the McCafé network across 41 restaurants in six
cities Mumbai, Ahmedabad, Nashik, Aurangabad, Pune and Bengaluru. Today, we are well on
track to launch over 100 McCafés over the next four years,” said Smita Jatia, managing director
— Hardcastle Restaurants Pvt Ltd, in Bengaluru on Monday.
Hardcastle Restaurants is McDonald's master franchise in the western and southern
markets. McCafe has now been launched in South India with the first outlet being opened in
Bengaluru.

Indian growth

McDonald's has invested about 7bn rupees in India since it entered the market in 1996
and reported growth of about 40%. India has a population of over 1 billion and an emerging
and affluent middle class. The food chain has tailored a number of its products to the Indian
market, including the Paneer Salsa Wrap, Mcspicy and Indi-Mcspicy, McAloo Tikki and the
mutton specialty for a country which does not eat beef, the Chicken Maharaja Mac. "In the next
two years, we should finally have a menu that is entirely relevant to the Indian household," Mr.
Bakshi said.

From the above information it is very clear that Mc Donalds is aggressive about its Indian
operations and this fast food chain is here to stay feeding millions of Indians the Jai ho way think
global act local.

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 BIBLOGRAPHY

1. “McDonald’s History - About McDonald’s." About McDonald's.

http://www.aboutmcdonalds.com/mcd/our_company/mcd_history.html

2. www.mcdonalds.com
http://www.mcdonalds.com/us/en/home.html

http://www.mcdonalds.com/us/en/our_story/our_history.html

3.https://en.wikipedia.org/wiki/History_of_McDonald%27s

4http://www.business-standard.com/article/companies/mcdonalds-to-open-100-outlets-
of-mccafe-in-india-115042000958_1.html

5 http://www.slideshare.net/pridhavale/mcdonalds-marketing-strategies
(slideshare)

6 https://www.surveymonkey.com/r/?sm=IxqTttG%2Buh0kXJRGO9zaZw%3D%3D

7 https://en.wikipedia.org/wiki/McDonald%27s

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