Global Fast Food Market And Industry

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Global Fast Food Market And Industry

Global Fast Food Market and Industry


Background Of Mc Donald

In 1937 Richard and Maurice McDonald developed a simple food processing and assembly line at a small drive in restaurant. Noticing an opportunity, Ray Kroc negotiated a franchise deal and eventually bought the brothers out in 1967. McDonald's in now the largest and well know global fast food retailer.

Business Description

McDonald's serves around 30,000 fast food restaurants that sell a menu of convenience food. McDonald's operates at a uniform standard and service. Besides from its outlets, McDonalds have new chains to meet the different sectors in the market, in the UK, Aroma Café is a chain of coffee houses selling sandwiches and desserts.

Situation Analysis

In order for McDonald's to analysis its situation; it must split its whole situation into four segments, two external and two internal. Each one will help them to analysis the individual segments and to aid in decision making. This report will look into the two internal and external sectors combined.

Reasons For Poor Performance

McDonald's early success was that its restaurants offered lower prices, faster services, and more consistent quality than competitors. Now competitors have caught up and are equally matching McDonald's quality and service. The fast food sector is now near saturation, with an overcrowded restaurant market and poor eating experience. McDonald's was forced to close over 700 restaurants and rethink its marketing strategy to attract old and new consumers.

Domestically McDonald's failed to keep up with trends in eating towards healthier upmarket meals. McDonald's has maintained a uniformity of all its restaurants that worked well in its domestic market. However, the novelty of American eating style has faded, new consumer habits differ from those in the 70s and 80s.

`With more health wariness consumers, it is essential for the fast food market to adapt to changes. Last year burger restaurants sales grew only 2% whereas sales at sandwich restaurants like Subway jumped 8% (Consultancy Technomic Information Services). McDonald's seem to have lost its capability to compete with rival's more innovative products, such as Burger King's fries and whoppers. With increasing competition from healthier options as well as other fast food chains, McDonald's need to make drastic changes to maintain its position as market leader.

Higher standards of living and social ambition has affected the way people want to buy. An increase in culture and taste, organic foods, up market restaurants and quality has become more significant, consequently consumers are deterring away from fast food. One important area of cross-cultural and international ethics is the treatment of employees by the organization. Though Mattel was charged with severe criticism about running Sweatshop Christmas and alleged for hiring underage workers in 1990 and 1996 respectively, it was not shaken by such criticism and took some significant steps to improve its image and working conditions to prove a point. A New York Times reporter reports, Mattel, in one of its biggest factories, in Guanyao, considered the world's biggest toy manufacturing center, where the workers mostly young migrant ...
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