At the start of 2015 McDonald’s stated they wanted to increase their net profit between 5% - 7% over 2016 calendar year. The Gross Profit ratio from 2014 - 15 did not fluctuate from 66%, following this was the small increase in net profit by 1%. McDonald 's had fallen far from their overall goal of a 5% -7% increase. Yum Brands is now achieving higher net margin at its company stores than McDonald’s with their revenue skyrocketing in from 41,546,000,000 in 2014 and 42,692,000,000 in 2015 well ahead of McDonald’s.
2015 saw McDonald 's wanting to increase the systemwide sales growth by between 3% and 5% over the 2016 calendar year. The objective was to open 500 more restaurants than closed in 2016 to increase total sales as planned. This failed with the a combined total of 350 stores across the US, Japan and China. After a global comparison sales report was released in May 2015 sales had increased across Europe by 2.3% but a decline in the US by 0.2% and Asian Pacific by 3.2%. This saw McDonald 's growth decrease failing to meet their goal of a 3%-5% increase in sales to boost the franchise further. Yum Brands continue to growth with over 43,000 restaurants in 135 countries and continue to jeopardise Mcdonald 's sales.
For McDonald’s to be more efficient they set an objective to reduce general and administration expenses by (US)$500 million as a result of company restructuring. From 2013 to 2015 McDonald’s expenses had risen from 83% to 85%, rising up to what Yum Brands had consistently held for those past two years. These expenses were found to be covering the working capital management of the franchise which increased the percenta...
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... the point of sale. McDonald’s also makes extensive use of leasing primarily relating to property, they have purchased (US)$14 billion worth of buildings on land it owned but also built a further (US)$13 billion worth of buildings on land that it leases for rapid expansion. This would allow cash to be retained and put to other parts of the business
McDonald’s want to maximise profits to improve on what they produced in 2014 -15 with nothing much improved on over the period. Revenue decreased by $2 million over that same time period, McDonald’s was wasting expenses on products which were found unpopular by customers forcing them to adopt a new inventory system that responds to customers orders which assists in lowering waste or food and other inputs. The company looks less at short-term promotions and more on long-term, sustainable growth.
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