INTERNATIONAL BUSINESS

Module 6: Entry Strategy and Strategic Alliance

Submitted by:

Abaya, Santino

Borer, Kathleen

Francisco, Bryan

Mercado, Lean

Olazo, Ashley

BSMM01

Submitted to:

Professor Marissa Sazon

1. Entrepreneur magazine annually publishes a ranking of the top global franchises. Provide a list of
the top 25 companies that pursue franchising as their preferred mode of international expansion.
Study one of these in detail, and describe its business model, its international expansion pattern,
desirable qualifications in possible franchisees, and the support and training the company typically
provides.

Top 25 companies:

1. McDonald's
2. KFC
3. 7-Eleven
4. Pizza Hut
5. Dunkin'
6. Taco Bell
7. Century 21
8. Real Estate
9. Kumon Math & Reading Centers
10. Anytime Fitness
11. Smoothie King
12. Baskin-Robbins
13. Circle K
14. Ace Hardware
15. RE/MAX
16. Arbys
17. Dairy Queen
18. Cinnabon
19. Chem-Dry Carpet & Upholstery Cleaning
20. The UPS Store
21. Hampton by Hilton
22. Popeyes Louisiana Kitchen
23. Snap-on Tools
24. Eye Level Learning Centers
25. Carl's Jr.
 McDonald’s
Is one of the most famous fast-food companies in the world. MCDO is known for their claim to
serve good food in a friendly and fun environment, to be a socially responsible company and
provide good returns to their shareholders. MCDO is a Franchised Business Model, it aims to
expand its profit by increasing its sales, keeping cost low and opening more outlets nationwide.
McDonald’s international expansion pattern is through Adaptation Strategy, it requires them to
study and learn the culture of the countries that they are putting their franchise or business with.
MCDO leaders believe that customers are their most important asset as they contend with public
and worldwide cheap food monsters all throughout the world. Their company and franchisees are
growing while learning to build a commitment with their employees and customers in the world.

Qualifications in possible franchisees

Personal Qualifications

McDonald's has minimum personal requirements that all potential franchisees must meet. These
include managerial-level business experience and a demonstrated ability to develop and
implement a business plan. A dedication to franchising, knowledge of business finance, and a
willingness to work on-site in the restaurant are also required. Potential restaurant owners must
also be willing to train with McDonald's for up to nine months before opening their restaurant, and
they must be able to manage and motivate employees.

Financing

When purchasing a McDonald's restaurant, franchisees must make a down payment. This is the
equivalent of 40% of the total cost of a new restaurant or 25% of the total cost of an existing
restaurant. This money must be paid with non-borrowed liquid assets like cash, securities, bonds,
or business or real estate equity other than your own home. McDonald must first consider you. You
must show that you have at least $500,000 in non-borrowed liquid assets. Because McDonald's
does not provide financing to franchisees, you will need to secure additional funding.

Application

The application to McDonald's Corporation is the first step in the process of opening a McDonald's.
If you meet the company's initial personal and financial requirements, you will be asked to work
and learn about the business for three days in a McDonald's restaurant. If your performance during
this period has been satisfactory to the company, You will be invited to a second interview to talk
about training and finances.

Training
 Before you can open a McDonald's franchise, you must first go through a training program run by
McDonald's Hamburger University. The training is delivered in part at the Hamburger University
campus in Oak Brook, Illinois, in part online, and in part at individual McDonald's locations. Before
they can qualify to own a franchise, trainees must complete a number of learning objectives.
Depending on prior experience, the entire training program can take anywhere from nine to
twenty-four months. Full-time or part-time training is available.

Support and training

World-Class Franchise Support

From the moment you enter our training program, McDonald's Field Operations and Franchising
staff work directly with you. The Field Operations team's primary responsibility is to assist our
Owner/Operators in maximizing quality, service, and cleanliness, which allows you to maximize
sales and profits.McDonald's also offers extensive marketing assistance, with award-winning
advertising that reaches people all over the world. To maintain and capitalize on our leadership
position, each restaurant is required to spend a minimum of 4% of gross sales on advertising and
promotion each year. Furthermore, the Company and its Owner/Operators collaborate to purchase
national television advertising through the Operator's National Advertising (OPNAD) Fund, a
voluntary U.S. cooperative of McDonald's Owner/Operators. The combined purchasing power of
pooled funds has assisted McDonald's in creating a worldwide brand unrivaled in the food service
industry—a significant advantage for your individual business.Owner/operators collaborate with
local agencies to place advertisements and, in some cases, produce their own products.
Furthermore, the Company and its Owner/Operators collaborate to purchase national television
advertising through the Operator's National Advertising (OPNAD) Fund, a voluntary U.S.
cooperative of McDonald's Owner/Operators. The combined purchasing power of pooled funds has
assisted McDonald's in creating a worldwide brand unrivaled in the food service industry—a
significant advantage for your individual business. McDonald's has a strong ongoing training
system that includes Hamburger University, which offers comprehensive management courses in
28 different languages.

McDonald's Supply Chain department has built a vast network of the world's most prestigious
suppliers. McDonald's collaborates closely with our suppliers to ensure that our restaurants receive
the highest quality products at the most competitive prices.
2. The U.S. Commercial Service prepares reports known as the Country Commercial Guide for countries
of interest to U.S. investors. Utilize the Country Commercial Guide for Russia to gather information on this
country's energy and mining industry. Considering that your company has plans to enter Russia in the
foreseeable future, select the most appropriate entry method. Be sure to support your decision with the
information collected.

The most appropriate entry method is the 50 state strategy and Trade talk strategy. In this
platform it will bring all together potential business partners and discuss any concerns in the
non-sanctioned portion of the Russian economy. In this way our business won’t have a hard time
finding potential business partners individually. This will save so much time and effort for our
company and our business partners. This will not only benefit our company but also the potential
business partners will also benefit. If one of the potential business partners has the same questions
as the other potential partners, It can be asked to us for once and we’ll provide an answer that will
be able to clarify things not only to one potential business partner but to most of them.

Also, this method will give investors more options to study and find out where the best place to
invest is. Gathering information, analyzing data, minimizing risks, maximizing potential, and
planning will all be given in this strategy. All in one basket. Investors should have a say if a place is
unwinnable or not, so giving them the whole pie and letting them slice through on their own would
be much greater. Afterall, it’s their money at stake.

Source :

https://www.trade.gov/knowledge-product/russia-market-entry-strategy

https://smallbusiness.chron.com/open-mcdonalds-10426.html

https://www.mcdonalds.com/us/en-us/about-us/franchising/training-services.html?fbclid=IwAR0ThnNeasLq
VPzvrDFsPdf_god5Qtr1yVwJaNOw5PerlI_tJbVLwYinLrs