strategic analysis of mcdonalds in india

strategical analysis of mcdonalds in indiaMcDonalds vision is to be the worlds best quick service eating house experience. Being the best means providing step to the forestanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile.Values.Our values summarized in Q.S.C V. Provide right quality, services to customer. Have cleanliness environment when customer enjoys their meal .The value of food product makes every customer is smiling.Executive Summary.This documentation is mainly about the line of credit strategies of McDonalds in India how it applies their strategies to interact with external environment.This discussed the following Porters models to imply the partys strategies in detailPorters Generic Strategy analysis.(Use to identify the strategies to select)Porters Value Chain analysis. (Use to identify the value bowed stringed instrument activities to choke off the system.)As a fast food community, the rivals that it ha s faced in the Indian economy during the implementation the strategies they applied, and the strategy changes according to different shoess reports from this document.Porters generic strategy analysis of McDonalds is mainly on its unique characteristic applied in India, companys commitment dedication bear onn to reach the success in the Indian market. It shows McDonalds demarcation strategies that took place during the banking crisis which lead to global economy recession how it affected the Indian economy.Through Porters Value Chain Analysis this document tries to highlight McDonalds primary activities support activities of their production process, applied in India. Through this analysis, it shows the factors influencing the company performance, coordination between firms in the industry their quality support services as well. Also, report tends to discuss the situation of other competitors in the industry, their performance and position in the Indian market.Finally, this report implies that low cost focus strategy can keep a company to survive in the recession. Also, it can achieve low cost focus strategy through their logistic systems, reducing food wastes and increasing effectiveness of employees.Introduction.Mc Donalds, was originated in USA (California) in 1954, and has become one of the successful fast food scopes in the world. Also one of the most recognized and established brands in the world. To such a development it helps some successful business strategies which lined to its external environment (Macro environment) and the industry environment (Micro environment).This document discussed the success of McDonalds peculiarly in India and the strategies that they followed to reach the current position. Also, this provides a discussion of an analysis of why the company selects those strategies in response to the changing external environment to reach the goals. The company was able to establish around 30,000 franchising stores in 119 countr ies, localizeing around 47 million people each day and it generates about $ 15 billion revenues annually.In India, McDonalds is a 50-50 joint partnership business between McDonalds corporations USA and two Indian businessmen. It took them six years with an investment of 4 billion to build up their supply chain properly in the Indian market. Their first restaurant in India was opened in 1996 at New Delhi.By introducing differentiated menu products according to the Indian taste, improving logistics systems with better supplier relationships it began to spread all over the country rapidly.Now the company expanded in 34 cities in India by covering 132 outlets.N. Jadhav A.Shaikh 2010, Supply chain management, Perishable products (Restaurant chain)Presentations, viewed 19/12/2010, http//www.slideshare.net/sunilmbsingh/mcdonalds-final (Diagram 1)Porters Generic Strategy AnalysisPorters generic strategies framework provides a major contribution to the development of the strategic managem ent the company can achieve to their competitive advantages by differentiating their products and services from its competitors through low costs. Mc Donalds targeted their products and services by a broad target through covering most of the market places. Also, it attains competitive advantage through market segmentation using Porters differentiation focus strategy.8.1 Differentiation strategy of McDonaldsIn differentiation strategy, fast food chains need to be more selective in which products to offer more creative in their promotion strategy.McDonalds offers specialised (Regionalized) version of its menu. This leads to differentiate the products from other competitor products as well.Mc Grilled sandwiches in US Canada.Mc Chicken Premiere Zesty chicken in UK, France, Italy Belgium.To overcome their healthy issues Mc Donalds added salads other lighter options to its menu encourage people to visit more often.Product adaptation in India- Vegetarian selections, No bellyache or pork items, McMasalaWide variety of menu items according to the Indian menu itemsVegetable non vegetable products.Health conscious items.Local flavors.Food preferences IndiaB. Craig K. R. Dickson, eleventh December 2007, Supply chain management, Mc India pptPresentations, viewed 19/12/2010,http//www.slideshare.net/KRDickson/McIndia-Final-ppt (Diagram 2)Mc Donalds premium lineThey have introduced a group of products in early 2000s. It includes McDonalds larger chicken sandwich, salad line coffee products. Grilled chicken sandwiches are targeted different demographic markets. Mc Cafes located in Australia within the McDonalds restaurant.Types of restaurantsCounter service drive through (With indoor outdoor seating in Delhi.)McDrive locations near highways offer no counter services or seating.McCaf restaurants within the same McDonalds restaurants. (They increased gross sales by 60% from this strategy.)Expansion for the following locations as wellMore distribution centers wi thin 500 km radius.Satellite cities near Mumbai Delhi.Cities with tourist aggregation and eating out culture.Petrol stations, railway bus stations in around Delhi.Shopping malls and movie complexes (Delhi Mumbai)Differentiating promotion programsMcDonalds focused on superior expense performance during the time of economic crisis.Point of sales (POS) promotion programs.Combo meals. (Customers get more discounts through this.)Lottery for winning its products.Sampling activities to taste their products to a discount price.Internet promotions.TV and other media promotions.To differentiate with their competitors McDonalds tried to focus on its unique campaign.Im lovin it campaign to attract family.Feature artists to attract teenagers.Introduces wireless engineering science platform, by allowing their customers to access internet by creating an innovative environment.8.2 Cost leadership strategyUnder Porters competitive strategies, McDonalds uses an overall low-cost leadership stra tegy to funk cost increase sales.Higher profits resulting from sales through lower prices than competitors as the unit cost is lower.Mc Donalds is having a biggest market share out of completive fast food restaurants. Therefore, they increase sales by reducing price than competitors.Food ItemsMcDonaldsSubwayKFCPizza HutDominosBurgers PizzasRs 20- Rs 70Rs 65- Rs 135Rs 25- Rs clxxvRs 55- Rs 175(Regular)Rs 35-Rs 140(Regular)Combo MealsRs 49- Rs 119Rs 45- Rs 175Rs 55- Rs 150Rs 120- Rs 250Rs 120- Rs 230BeveragesRs 25- Rs 50Small- 300mlRs 35- Rs 45Small 300mlRs 30- Rs 55Small 300mlPet beverageMRP 600mlRs 30600 ml leaveRs 12-Rs 25Rs 20- Rs50Rs 15- Rs 65Rs 40- Rs 60Rs 25 100 mlCup of Baskin Robbins(Diagram 3)Market share (worldwide)CompanyStoresCountriesMarket shareMcDonalds3110812033.06%Burger King114555813.68%Wendys88112211.69%Hardeess3295152.78%Jack in the Box200013.67%(Diagram 4)McDonalds India Network competitorsCompanyOutlets (No.)Cities CoveredMcDonalds13234Pizza Hut13734Dominos2 2042Subway13132KFC3409(Diagram 5)Bruce Craig, Keith R. Dickson, International Business Management, Network competitors Online, available at http//www.slideshare.net/KRDickson/McIndia-Final-ppt 20/12/2010Through adding 700-900 restaurants annually, McDonalds enter new markets through lower prices.It shows a great barrier to entry for competitors to enter the industry.Through its strong centralized authority tight control, standardized procedures McDonalds takes most an efficiency approach.Key elements of McDonalds business strategyAdding 700-900 restaurants annually.Giving low price products, Extra offers through new menu items.Highly selective in granting franchises.Selects most convenient places to customers.Focused on express mail product lines through maintaining the quality.Extensive advertising.Proper HR management through equitable wage good training.McDonalds cost leadership strategy growth strategy is based onAdding new restaurants.Maximizing sales sales in existing re staurants.Improving profitability (globally)Success behind their business lies in the supreme of Think global, act local.They ensure that their structure fits with the international environment, but also have internal flexibility geographically.McDonalds has twice the market share of its closest competitor, Burger King.