Mc Donald’s is the No. 1 ranking food retailer. They almost make a monopoly of the fast food industry. And more than 80% of the restaurants are franchised by the local business people. Mc Donald's basic philosophy includes the good relation with the franchisees. Because the relationship with the franchisees is not good they can't improve quality, expand the market and increase the value. To open up a new Mc Donalds it can cost anywhere from $511,000 to $ 1 million. The form of franchise McDonalds uses is a business format franchising which is a relationship with the franchisor and the franchisee. The franchisee must meet with all the requirements of the franchise and the franchisor expects all the requirements to be fulfilled according to the restaurant.
Also, location plays key role on Mc Donalds way to success. As we know from Chapter 2, Mc donalds key strategy plan is geographic advantage. The proper locations boost the company as well. The fact that McDonalds offers a drive- thru option is great for people who are on the go and are looking for quick meals. It makes it more convenient for drivers and that’s what people are looking for, something that involves low to no action on their part. Also, the practical location would be any place where there are lots of students or workers. They want something instant and on the way since we are usually all in a rush to get to their destination.
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