McDonalds: Polishing the Golden Arches Introduction: In1937 two brothers, Dick and Maurice Mac Mcdonald opened

a tiny drivein restaurant in east of asadena, California. Initially it included car hops but after hiring Mr Ray Kroc to the organisation, it changed its setup drastically. And finally established Mcdonalds Restaurant and then Mcdonalds System inc. in 1956. Mcdonalds. In 1965 under the leadership of Kroc and Sonneborn Mcdonalds became a pulic company, selling shares for $ 22.50 each in its initial public offerings. About an year later, on July 5, 1966 Mcdonalds was listed on the New York stock exchange. They had a vision of building a restaurant chain that served a low priced, value oriented product fast and efficiently in clean and pleasant surroundings. Mcdonalds had its first international franchisee at Canada on June 1, 1967. It also opened mcdonalds Playland in California in 1971. And there after opened many of its franchisees in Japan, Germany and Australia. By the end of the 1970s Mcdonlads had over 5000 restaurants across the globe. Strengths: The biggest strength for Mcdonalds would be its biggest market share. Mcdonalds is far ahead than its biggest threats i.e. Burger king, Wendys, Jack in the box, etc. Apart, likes of the localites viz. No dairy products in Jerusalem. Mcdonalds had a sale of $20,305.7 million in 2003 which also acts as a strength for it. 5 largest chains based on 2003 systemwide sales
sales (million)llio n) $20,305.7 $8,350.0 $6953.0 $5,334.0 $5230.0

Chain
McDonalds Burger king Wendy's Aramark global food Subway

Mcdonald has been proved as the biggest hamburger chain in 2003 with a total of 31,108 systemwide outlets in around 120 countries. This also depicts its high coverage over international market. Weakness: Greenberg, former Ceo, initiated and introduced a new setup to attract customers na mely, Made for You. It was a cooking system designed to allow customers to order and receive their food in 90 seconds. This initiative cost Mcdonlads $420 billion and each franchisee between $18,000 and $100,000 in kitchen upgrades. Inspite of incurring such a huge expenditure, it did not turn fruitful to mcdonalds and gave a financial halt. Greenberg

proved expensive for the organisation. Thus he can be regarded as a tyro leader. The unsuccessful initiatives turned beneficial for the competitors. The lack of proper strategic planning implemented during tenure of Greenberg has resulted in the lowest performance ranking in the fast food industry based on such factors as poor customer service, high employee turnover and slow order processing time. These factors hinder Mcdonalds growth rate. Customer service ranking, fourth quarter 2002 Company
Wendy's International KFC corporation Burger king Corporation Taco Bell Corporation U.S. Internal Revenue Service Mcdonlds Corporation Quality Ranking 74 69 68 67 62 61

Opportunity: Fast food market is a big industry and is growing fastly. Mcdonalds is the big daddy of this industry. Inspite of various competitors like Burger King Corporation, Wendys international Inc, Hardees, Jack in the Box, sonic, etc, Mcdonalds has opportunities to grow further. It is having the largest market share of 33.26% in 2002 and ranked 1 among all the other market players. As mcdonalds works and provides services as per the requirements of the people, this may take it to the heights of success. The tag line of Mcdonalds Im lovin it is itself creating brand image and establishing brand name in the minds of the customers. Threats: After the lawsuit brought by the eight teens against four fast food chains for causing obesity caused many of the restaurants to renew efforts to offer healthier menu items ranging from saladsand soups to healthier hamburgers. Mcdonalds was also among them who where effected by it. From then the people became more conscious towards the healthier food items. Mcdonalds also had to restructure its policies regarding the lawsuit. Subway was the only brand that was offering healthier stuff since the beginning. Thus Subway was the main threat for Mcdolnalds at that time, as it was the leader in providing healthier stuff to public. this was the only threat to Mcdonalds. Mcdonalds was considered as not providing more of healthy food to the people and it need to overcome this lacking. Restructuring: Moreover it is not needed nut some of the lacking areas need to be restructured. Mcdonalds should focus on providing more of the healthier food stuff to the people. It should lower down the rates of the healthier products so they could come to the reach of common average earner.

It has replaced French fries by apple slices in the Happy meal for the children but besides this it should also introduce some health drink in it and make healthy products available to the grown-ups also. Ever since establishing its first international franchisee in Canada on 1 June, 1967, it has expanded itself in around 120 countries by 2002. Thus it should keep on expanding itself. It should keep following it golden rule of QSVC model (quality, service, value and cleanliness) as this was the base of its uniform setup and working and finally it would help the organisation in Polishing the Golden Arches.