FROM SUPPLY CHAIN

TO CUSTOMER VALUETHE Mc DONALDS WAY

Operations in India
First

outlet in India opened on

13th oct. 1996
Till 2007 it had 48 0utlets
Currently it has 187 outlets in
India
Invested more than 1000 cr. in its
supply chain
Supply chain work started 4
years before the launch

Initial Problem
Setting

up the whole supply chain

Post harvest losses in India
Invest heavily in real estate because of its
locations
Identifying suppliers for each of its ingredients
Getting inputs as per McDonalds
specifications
Invest in developing farms to meet their
specifications
Adapt according to Indian culture (Beef and
pork products)

Success Mantra
McDonalds

Golden Rules- Supply Chain, Supply

Chain, Supply Chain
All Ingredients resourced from one or two
suppliers(Except lettuce)
Suppliers expected to keep reducing cost
through improved efficiency and kept the
suppliers at competitive
Supply chain work begin 2 years before the
launch of a new product
Use of High tech multi-temperature vans for
transportation
These trucks had three level of variable
refrigeration with adjustable sizes
This flexibility was key to costs of perishable

Supplier relation
Its

suppliers are always

partners, never just suppliers
Help suppliers to grow big
enough to generate economies of
scale and lower prices, while
maintaining consistent quality
International technology and
Know-how are provided by the
Company

Quality First
McDonalds

carries out quality

checks at over 20 different points
in cold chains
Rejection rate brought down to
2% from 8-10%
Quality assurance expert rejects
the whole batch if any item does
not meet even a single quality
parameter

Vegetarian sauce from

MNS bector speciality
foods , Phillaur Punjab

Cheddar
Cheese from
dynamix
dairy,
Baramati,
Maharashtra

Buns From Shah Bector

& sons , Khapoli
Maharashtra

Iceburg lettuce
from: Trikaya
Agriculture,
Telegada
Mahrashtra,
Ootyfarms,
Tamilnadu,
Agritech Delhi

Batter &
Breading
cremica
Ludhiana ,
Punjab

Vegatable Patty:
Vista Processed
foods, Taloja
Maharashtra

Trikaya agriculture
Started

by late advertising legend Ravi

Gupta
Supplies 1/3rd of Mc Donald's 450 Tonne
requirement.
A team of agricultural experts.
Uses micro irrigation techniques
Planting on raised beds
with the advise of McD
Heavy

investment made on infrastructure

to cater to McD demands

Vista Processed Foods Pvt. Ltd. Supplier of Chicken and Vegetables

A

joint venture with OSI Industries Inc.,

USA, and McDonald's India Pvt. Ltd.
Supplies a range of 12 products
frozen peas, vegetables, and chicken.
Deals

with 45 suppliers
Procures Chicken from Suguna, Coimbatore
Strict Quality Control and Assurance
Measures
Reduced Rejection Rates
From 10 to 2percent

Low

cost per unit

McCain Foods
Worlds

largest French fries

company
Help Indian farmers grow right
kind of potatoes
Started contract farming in
Deesa and kheda district
Also helped farmers in better
agronomy techniques, irrigation,
planting methods etc.

Radha Krishna Food Land

Limited
Responsible for procurement, quality inspection,
storage, inventory management, delivery to
restaurant, data collection
A one stop shop for all distribution management
services
Dry and cold storage facilities to store and transport
goods
Effective process control for minimum distribution
cost
Raw
Materials

Processing
Centers

Processed
Food

Distributio
n Centers

Outlets

Benefits with McDonalds

Maintain

quality standard in a cost effective

way
Upgrade their services and enlarge their
business portfolio
Encourages them to work with its foreign
partners to gain technical knowledge
Better backward integration for the supplier
with farmers
Innovation in methods to increase shelf life
of product(patty)
Constantly strive for efficiency in the system
to reduce cost
Timely information to the farmers to

Risk with McDonald

Quality

is their main aim

Any damage to any material has
to born by the supplier
If not up to the quality standards
complete rejection of the lot of
material

Pricing
Increasing

efficiency
Reducing cost
Reducing wastages
Win Win situation
Continuous innovation

In fast food the

differentiator is always the
efficiency of the SUPPLY
CHAIN.