Report on the existing digital activities

and strategies of McDonalds

Name:Zainab Javed Malik

Student ID:19036306
Word count:
Table of Contents
1)Executive summary..................................................................................................................................3
2)Mc Donalds background...........................................................................................................................3
Table 1:McDonald’s e business model........................................................................................................3
3)Mc Donald’s current e supply chain.........................................................................................................3
Diagram 1:Push and pull supply chain model..............................................................................................4
4)Current e-business strategy.....................................................................................................................5
Table 2:Mc Donald’s business canvas model...............................................................................................6
5)Current issues in e-business strategy.......................................................................................................7
Table 3:SWOT analysis.................................................................................................................................7
6)References................................................................................................................................................7
1)Executive summary
The report is based on the digital activities of the McDonald’s which consists of the company’s
background including its supply chain,e-strategies and issues in developing the e-strategies.

Section1:This section begins with the brief background of McDonald’s including the e business
model of the company and its current operations.

Section2:This section highlights the company’s current e-supply chain with its management.

Section3:This section focus on the current s-strategies of McDonald’s with its business canvas
model.

Section 4:This section reflects the issues in the strategies of McDonald’s which includes the
SWOT analysis of the company in detail and at last the references are added.

2)Mc Donalds background

Mc Donalds is one of the largest fast food chain known for its hamburgers.It has its
headquarters in USA Illinois.It was started by two brothers named Richard Mc Donald’s and
Maurice.The company primarily sells its fast food through 36,258 restaurants in 119
countries.The number of employees are around 420,000.

Type of e business models Explanations

Business to business(B2B)
Business to consumer(B2C)
Mc Donald’s uses the company’s electronic
supplier portal on the company’s website to
connect,establish partnership and complete
business transactions such and order and
tendering procedure,financial transactions
and so on,The company also uses the
platform to gain access to new investment
opportunities in start-up.(Mc Donalds,2020)
Mc Donald’s operate physically and online as
well because the company has its own
website and besides this other app for
 placing the order.As the customer will place
order for its food and in return the company
will earn money and deliver the product if
purchased online or otherwise the customer
will take the product itslef if purchased at
the store.(McDonald’s,2020)

Table 1:McDonald’s e business model

3)Mc Donald’s current e supply chain

Suppliers supplies the materials

Product delivered to distribution centers

Product delivered to restaurants

Push stops
here pull
starts here

Customer order at restaurant

 Diagram 1:Push and pull supply chain model

The (diagram 1) above illustrates the supply chain management of the company which is
concerned with managing the organization’s supply of goods and their delivery to their final
customers after they are manufactured into finished products.There are certain parties
involved in Mc Donald’s supply chain management process.Mc Donald’s core suppliers can be
categorized into two types ties 1 suppliers and tier 2 suppliers.In respect to tier 1 suppliers this
include processed goods such as potato,tomato,chicken,hasbrowns etc.Tier 2 includes suppliers
who are mainly farmers and processors including potatoes,poultry products,chicken etc.Both of
these suppliers are responsible for meeting the Mc Donalds material requirement.These
suppliers account for supplying the company with the necessary materials to serve its
customers.The supplies are being delivered.The supplies are being delivered to the distribution
centers by logistics service providers.At restaurants they are ordered to the distribution centers
upon requirements for such materials,which lead to their transportation via logistic
management system across the company.The packged foods as supplied to the company are
then eventually packaged by the final customers via the Mc Donald’s outlet for consumption.It
is the whole supply chain system prevailing in support of Mc Donald’s activities in most
countries across the globe.(McDonald’s supply chain,2014).Other than this e supply chain is
followed in McDonald’s back in 2000 the company formed a partnership with Accel-KKR to
establish the e-mac digital which will connect the businesses globally.Using this the company
can create its strength and communicate more effectively and improve the operations.By
building an e-procurement platform for McDonald’s and their suppliers to help manage
information,trandsactions,sales,orders and other functions,e mac digital has helped deliver
better values in the supply chain.Using this sitre for the company it offers discount foe the
owners reducing the cost.Through this the labour cost cost have been reduced by 85% and daily
69 millions customers demands are satisfied making supply chain run effectively.(Kshitiz
sharma,2013)
4)Current e-business strategy
The current business strategy of McDonald’s is followed by various factors such as value for
money,with its value for money meals such as the buffalo ranch and Mc Chicken and the
jalapeno Mc Double,Mc Donald’s aims to target price sensitive consumers.At start the company
targeted high priced item but recently they shifted to low priced menu.Besides this Mc Donald’s
always focused on customer service with high quality food and clean surroundings.Speed is one
of the most important aspect of fast food restaurants for example in rush hours(lunch and
dinner) customers expect to get their order quickly within one minute but during slower times
they need to wait for two to three minutes before they develop negative opinions about the
company.So in ordervto maintain reputation the company decided to eliminate its menu and
focus on its traditional menu like big mac,fries,fish etc.Furthermore by doing brand market Mc
Donalds have always been the leader as companys product are labelled as junk food which is
not considered healthy so now Mc Donald’s aims to increase the trust of its customers by
offering salads,sugar free drinks,iced tea etc items in the menu which are low in calories or
carbohydrates.Besides this Mc Donald’s has introduced menu variation for different operating
countries that has actually complicated menu items and increased preparation times,while
waiting for Mc Donald’s consumers to standardize and simplify their menu items and include
food items taht can be easily prepared in shortest possible time.one of the most important
business strategy that company has shifted its focus on digital marketing through different
social media platforms like facebook,instagram and youtube ads and also to gain the edge in
the fast food industry they introduced its breakfast menu including coffe,milkkshake etc.

Mc Donald’s mission is to be great place for consumers to eat and drink(Mc Donald’s,mission
and values,2014).The company is working to give its customers worldwide a superior service
experience.It also seeks to profitably grow its business while contributing to the growth of the
community.

Key partners Key activities Value proposition Channels

Mc Donalds main key
partners are its franchise
holders.other than this are
Coco cola
Toys”R”US
The key activities of the Mc Donalds is famous for its Online company
Mc Donalds engages is in value propositions:food of a websites and apps
the market selling food constant quality that is served and also through
and beverages. quickly and consistently across
the restaurants.
the globe.
 Sponsors
Investors
Security and insurance
companies
Customer relationships
The customer relationship
takes place online via the
company website or appn
launched by the
organizastion.Other than
this facebook,youtube and
other platforms to interact
with customers and create
awareness.
Cost structure
The cost structure
consists of employe
salaries,facilitiy
construction
cost,raw material
procurement and
marketing cost.
Key resources Customer segments Revenue streams
The key resources are The main customer segments of Mc Donalds
the company’s the company are revenue is
employees and its families,youngsters,the elderly generated at the
restaurants on a prime and business people. restaurants owned
location. by the company
itself and its
franchise holders.

Table 2:Mc Donald’s business canvas model

Table 2 above measures all the strategic success of the business considering different factors
and so on.

5)Current issues in e-business strategy

It has been difficult for McDonald’s to increase prices without turning customers away.For
example,at one time the famous Dollar menu featured a big N’tasty,made from a quarter-
pound of beef.But McDonald’s has had to swap things over the years,as the cost of beef and
cheese has increased.

McDonald’s executives said they launched too many things too soon last year,such year,such as
MCWraps and the decision to replace its breakfast sandwiches with egg whites.That slowed
services and resulted in inaccurate orders.

Opearting in established markets such as the US and europe,McDonald’s faces more strict
legislation.Some legislative reforms include the printing to young prople of nutritional content
on products,food labelling,taxation and marketing.This may turn into higher enforcement costs.
The delivery of food is only to limited area and in some areas they refuse to deliver which is not
satisfactory and customers are dissatisfied with this.Besides this on rainy days McDonald’s also
does not deliver and dont take orders so they should introduce a service method or launch
something so customers can also place orders on rainy days.

Furthermore due to not delivering in certain areas McDonald’s is facing a fierce competition
from its competitors like KFC,burger kings and some other fast food restaurants.(the star,2020)

The issues Mc Donald’s is facing in developing the business strategy considers the internal and
external factors.To address the issues a SWOT analysis is conducted.Mc Donald’s uses a variety
of strategies to deal with the internal and external and factor.

Strength Weaknesses Opportunities Threats

This attribute of Mc Weakness is linked with Opportunity is an This external factor
Donald’s make it a top focus in the external factor which is factor is linked with
competitor in the market market,product and linked with global social trends and
for fast food process this is an internal growth and product competitive rivalry.As
restaurants.This element strategic factor.Mc
mix.Mc Donald’s has fast food industry is
of SWOT analysis reveals Donald’s weaknesses is
the strategic internal that the company the opportunity to highly competitive and
factors leading to standardization maintains easily expand in Mc Donald’s can face
organizational continuity but also limits developing countries alot of
stability.The strong brand the company’s flexibility like asian countries competition.besides
image of Mc Donald’s in responding to besides this the this healthy lifestyle is
makes it competitively consumer comapny can adopt the important which can
strong and beisdes this variations.Product market development be overlooked so it can
the company has strong diversification is low strategy in middle east stop customers eating
market diversity because which can make the countries which it has outside.Furthermore
of its global presence.In business highly
not entered yet.In GMO regulations are
addition to this,Mc vulnerable and slowdown
Donald’s has a restaurant industry.Other addition to this the it necessary and the firm
comprehensive than this most of the has the opportunity to currently does not
standardized process comapny revenue is introduce new have thisn policy of
system,which is a generated from US and products. GMO ingredients.
strength that contributre western economies
to business efficiency and
consistency of the
product.

Table 3:SWOT analysis

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