McDonalds Case Study

Operation Management Assignment: Mcdonald’s Corp

1. Positioning of McDonald’s as a fast food business

McDonald’s is a fast food company that was founded in 1940 started by McDonald’s brothers. Restaurant operated in San Bernardino, California, United States. They rechristened their business as a hamburger stand. The first time a McDonald’s franchise used the Golden Arches logo was in 1953 at a location in Phoenix, Arizona. In 1955, Ray Kroc, a businessman, joined the company as a franchise agent and proceeded to purchase the chain from the McDonald’s brothers. McDonald’s had its original headquarters in Oak Brook, Illinois. More than 30.000 local restaurant serving nearly 50 million people in more than 120 countries each day.

• Costumers

Costumers has a great deal of selecting power due to the fact that if they are dissatisfied with the food or service they can easily switch or purchase from an alternate product. But it is undeniable that any organization cannot satisfy the needs of all the consumers. Therefore organization divides the market into segments which display similar characteristics or behavior is necessary, also it affected by cost that the segment can afford. McDonald’s market segmentation is based on demographic variables Age and Lifestyle. The primary target markets are seniors, adults and teenagers, but the most heavily targeted segment is children.

The market segmentation of McDonald’s can be visualized as follows:

• Seniors
• Adults
• Teenagers
• Children

Customers are those who pay money to acquire an organization's goods or services. For many years McDonald’s mostly targeted the young people, however this has changed in this decade; McDonald’s has turned towards a more general market. By doing this McDonald’s concentrates on the family, targeting a diverse market. Customers used to get to know about the products through advertising. Now a days they are focusing on billboards and give ads on social media site.

• Competitor

Burger King

Burger King started in 1954 and is headquartered in Miami, Florida. As of August 2014, Burger King merged with Canadian Restaurant. The combined company has annual revenue of 23 billion dollars, with over 18,000 restaurant in approximately 100 countries. Nearly all of those locations are owned by independent franchisees. The company’s menu includes breakfast, lunch and dinner items available a la carte. Hamburgers, chicken sandwiches, chicken tenders, French fries and beverages are categories featured on the menu. In 2015, Burger King did an aggressive attack against its larger competitor, using strategic price increase to cover the cost of promotion on popular product.

Wendy’s

Wendy’s is a fast-food restaurant chain with almost 6,500 locations in 28 countries. Wendy’s menus include hamburgers, sandwiches, chicken products and side dishes. Wendy’s invest in long term brand development by redesigning its store, offering an expanded menu include breakfast, and new advertising campaign. The good news for Wendy’s, their effort has made increase sales in same store 5-25 percent. At the same time, Wendy’s cut cost production by refranchising company owned stores, with the goal of decreasing ownership from 15 to 5 percent.

Taco Bell

Operating as a Yum! Brands subsidiary, Taco Bell is a fast food chain of stores with headquarters in California, USA. The restaurant offers a variety of foods which include quesadillas, tacos, nachos, burritos and other Tex-Mex foods. The company has approximately 6000 restaurant in US. Taco Bell serves fast food breakfast and lunch dishes inspired by Mexican cuisine, including tacos, burritos, nachos and related specialty items. KFC serves various chicken dishes and sandwiches along with sides and beverages..
Taco Bell was founded in 1962 by Glen bell and ever since then the company has grown and expanded to what it has become today. Although it has branches worldwide, Taco Bell mainly serves in Canada and USA.

Subway

Subway is the largest restaurant chain in the world. The company was founded in 1965 and is headquartered in Milford, Connecticut. All Subway locations are owned by franchisees, of which there are more than 21,000. The company’s menu consists primarily of submarine sandwiches and salads. Know for its healthier menu, 44,000 locations including 27,000 in US. The chain has been popular lunchtime destination for Americans. Even they continue to open their restaurant around the world, the former quick serve has fallen on trouble times. Sales dropped by 3.3 percent to 11.9 billion dollars in 2014 and annual sales decrease from 490,000 dollars to 475,000 dollars.