McDonalds

Bolivia Case
study
Juliana Cabrera
 CONTEXT OF THIS CASE
● In december 1997, a local businessman in conjunction with McDonalds after several years of research and training,
managed to open the restaurant doors to the bolivian market with huge reception from bolivians.
●
As years passed, McDonalds expanded to other major citites in Bolivia, Santa Cruz de la Sierra and Cochabamba. 

●  They even wanted to incorporate to their menu a high demanded dish called “Salteñas”, a typical local empanada well
known for its flavour but after a rigorous analysis of how it was made the headquarters basically rejected it because it
did not met McDonalds minimum sanitary standards.

● By 2002, only 5 years after the initial kick-off of the brand in Bolivia, they were already leaving the country.
McDonalds was having losses for several years in a row and initial investments were not breaking even. Bolivia’s
economy and culture was not ready to incorporate McDonalds into their market.
The reasons
 REASONS OF MCDONALDS
FAILURE

01 02 03

Cultural Economic Political

#1
CULTURAL
5 DIMENSION MODEL
BOLIVIA USA
In Bolivia the norm is to eat with
your family and friends.

To be a good meal, food has to

have to be prepared with love,
dedication, certain hygiene
standards and proper cook time

McDonald’s culture is the

opposite of that.
 BOLIVIAN TRADITIONAL MARKET
When bolivian people purchase fast food
they buy from cholitas (indigenous). While
they sell they even flirt with you to get a
sale, they also make you laugh making a
bond with the customer to get them to
return.
60% of bolivian population belongs to native
americans (indigenous) communities.
BOLIVIAN TRADITIONAL FOOD
KALA PURKA

FRICASE
Bolivian food is spicy
Attachment of bolivians to traditional dishes

McDonalds products tasted like plastic, not

enough flavour and was importing most of its
ingredients. They couldn’t adapt to bolivian
prefferences.
On the other hand, its competitor, Burger king,
use supplies from local market.
#2
ECONOMICAL
REASONS
 BOLIVIAN MCDONALDS

Costs 2-3 Bolivian pesos Costs 14-15 bolivian pesos

Price discrepency discourage
customers
NO MARITIME BORDERS
#3
#2

POLITICAL
 Evo Morales
He used to have a communist influence – against foreign investment.
 COUNTRIES WITHOUT MCDONALDS’
PRENSENCE

From 120 countries

where McDonalds’
operates only in 5
countries didn’t
succeed (Iran,
Barbados, Iceland,
Bolivia, El Salvador)
IMPORTANT LESSONS
Every business before starting its operation in a
new country firstly they must conduct a
marketing research that is a necessary step for
the effectiveness of the ongoing business.

It is essential to get to know the culture

And people habits

Product standarization might not work in all cultures

THANK
YOU