McDonalds

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McDonalds This is an exciting and interesting essay to write for a number of reasons. For one it's an honour to make a research on one of the most profitable societies of the world, for second because the kindness of McDonald's employees and the precision of McDonald's Web site, are perfect sources for all kind of information that can help analyse through Porter's value chain, all the aspects of its value creation. In the late 1940s, Dick and Mac McDonalds were searching for a way to improve their little drive-in restaurant in San Bernardino, California, U.S.A.; they invented an entirely new concept based upon speed service, low prices, and big volumes. Word of its success spread quickly, in 1952 they had more than 300 franchising inquires a month from all over the country. McDonald's is now the largest and best-known foodservice retailer and one of the two best-known and powerful brands in the market. With more than 24,500 restaurants in 115 countries, some of those operated by the company, some by franchisees or by affiliates operating under joint-venture agreements. The global market potential is still huge: yet on any day, even as the market leader, McDonald's serves less than one percent of the world's population. The restaurant chain plans to expand their leadership position through convenience, superior value and excellent operations. The effort to increase market share, profita! bility and customer satisfaction has produced high returns to shareholders: a compound annual total earning of 21% over the past 10 years. McDonald's vision is to dominate the world-wide foodservice industry. Universal dominance means setting the performance standard for customer satisfaction and increasing market share and profitability through successful fulfilling McDonald's convenience, value and execution strategies. A precise way of considering McDonald's' role of operations is through Porter's value chain analysis. The Value chain breaks down the firm into its strategically relevant activities, in order to understand the behaviour of costs and the existing or potential sources of differentiation. A firm gains competitive advantage by performing these strategically important activities more cheaply or better than its rivals. For a company which feeds some 38 millions clients every day, finding a reliable quality supplies is a major factor for success. McDonald's has solved the problem by making food supplies part of their success. McDonald's distributors are strategically to be accessible to the each restaurant and carry practically everything, from meat and potatoes to lightbulbs. Coca-Cola, the right well-known drink, has been with McDonald's from the beginning supplying beverages. McDonald's is increasingly using its leverage to capitalise upon global purchasing practices. New restaurants throughout Europe feature tabletops from Belgium; chairs, floors and tiles from Italy; doors from Austria etc.

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