Case Study Assignment 1
McDonald’s Corporation
SWOT Analysis
Strengths:
Brand Recognition
McDonalds is one of the most well-known fast-food chains in the world.
With their iconic golden arches and catch phrase “I’m lovin’ it” has
earned the company a reputation as a trusted and recognizable brand.
Diverse Menu
Large menu has something to appeal to all customers and they
customize menu selection to regions the fast-food chain serves.
Franchise Business Model
Most McDonalds are franchised allowing for quick expansion without
the risk of using their own capital to expand.
Weaknesses: Staffing Issues
Understaffed locations result in rude and unfriendly staff that are
driving customers away.
Product Quality
Public perception of product quality is weak, more people are
concerned about where their food is coming from and if meat was
raised in an ethical and healthy way.
Menu to Large
Over 120 menu items that require special equipment that must be
purchased and more time to prepare the food.
Opportunities: Expanding Home Delivery
Many millennials prefer to order food to their doorsteps. Expanding
delivery with options across the country will add ore sales and
customer satisfaction.
Healthier Menu Options
Approximately 1/3 of the population is considered overweight and the
more health focuses people of today prefer healthy menu items.
Adding healthier options can increase customers.
Expanding Technology
Expanding more self-order kiosk across the franchises as well as
targeting a smartphone application for ordering food before arriving at
restaurant and creating a rewards system for frequent app use.
Threats:
Intensifying Competition
Many consumers have been flocking to competing chains that offer
higher quality foods such as Chick-fil-A, Five Guys, In-N-Out Burger, and
Smashburger.
Declining Demand for Fast-Food
The fast casual restaurant industry is also growing at a fast pace. These
restaurants provided high quality foods at an acceptable but higher
price than McDonalds have been increasing over the years and gaining
more customers that prefer the atmosphere and quality food over fast
food.
PESTEL Analysis
P:
Health and safety regulations are constantly changing, and McDonalds must not only
adhere to the ones in the United States but as well as the more restrictive regulations
in the international countries McDonalds has franchises in.
E:
McDonald must be aware of rate change in foreign currency exchange when the
declare income at the end of the year. Inflation rates also impact the company, when
inflation is on the rise like it has been in the past menu items must increase in order
to make up for the increase in food and materials required. The unemployment rate
of the region McDonalds has stores at needs to be monitored. This will affect
employee turnover and ultimately customer service.
S:
Over the past few years an emerging trend to eat and be healthier has swept through
America. McDonalds needs to provide healthier options in order to accommodate the
millions of people that are set on living a healthier lifestyle.
T:
McDonalds has put digital display kiosk in over 8,500 stores and are continuing to
modernize other locations. They have replaced their menus with digital displays as
well and use the acquired Dynamic Yield to personalize the menu based on time of
day, weather, and items already in customer’s order.
E:
McDonalds has been targeted in the past on not ethically sourcing their ingredients,
since 2018 they have used fresh beef in all U.S locations and have stopped using
chicken products that have been treated with antibiotics as well as they have set up a
10-year plan to only use suppliers that keep their chickens cage free.
L:
McDonalds must ensure all locations are following all local laws and regulations as
well as federal laws and regulations. McDonalds has a code of conduct that upholds
employees to follow the law as well as follow ethical business practices.
Resources:

Brand Name
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Capabilities: (A capability is something a business does very well, using their resources.)
Core Competencies: (A core competency is something they do better than their competitors,
which can lead to a sustainable competitive advantage.