Fast food industry

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INTRODUCTION

Fast Food Industry is one the most developed and productive industry in UK Despite of recession Fast Food Industry is not much effected by the inflation, but is giving revenue to its owners.

Fast food is the term given to food that can be prepared and served very quickly. While any meal with low preparation time can be considered to be fast food, typically the term refers to food sold in a restaurant or store with low quality preparation and served to the customer in a packaged form for take-out/take-away. The term "fast food" was recognized in a dictionary by Merriam-Webster in 1951.[1]l,b.

Now the company I want to discuss is Mcdonalds,one of the world largest fast food chain orginated initially in United states.

Mcdonald's is the leading global foodservice reailer with more than 31,000 local restaurants serving more than 58 million people in 118 countries each day. More than 70 percent of Mcdonalds restaurant are owed and fuctioned by local men and women.

Mcdonalds serve the world some of its favorite foods - World Famous Fries, Big Mac, Quarter Pounder, Chicken McNuggets and Egg McMuffin.

Our rich history began with our founder, Ray Kroc. The strong foundation that he built continues today with McDonald's vision and the commitment of our talented executives to keep the shine on McDonald's Arches for years to come. To read more about McDonald's history, vision and executives, click on their links in the left menu.

(www.aboutmacdonalds.com)

History of McDonalds

The business initially began by two brothers named Dick and Mac Mcdonalds in San Bernardino in California. Their introduction of the Speedee Service System in 1948 established the concept of the modern fast-food system.

The first Mcdonald's restaurant opened in Amerca,Canada,Costa Rica,Japan,Holland,Germany,Austraila,France,ElSalvador and Sweden in order of openings.

The present corporation dates its founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois on April 15, 1955[7] , the ninth McDonald's restaurant overall. Kroc later purchased the McDonald brothers' equity in the company and led its worldwide expansion and the company became listed on the public stock markets in 1965.[8] Kroc was also noted for aggressive business practices, compelling the McDonald brothers to leave the fast food industry. The McDonald brothers and Kroc feuded over control of the business, as documented in both Kroc's autobiography and in the McDonald brothers' autobiography. The site of the McDonald brothers' original restaurant is now a monument.[9]

With the expansion of McDonald's into many international markets, the company has become a symbol of globalization and the spread of the American way of life. Its prominence has also made it a frequent topic of public debates about obesity, corporate ethics and consumer responsibility.

http://en.wikipedia.org/wiki/Mcdonalds

INNOVATIONS ADAPTED BY MCDONALDS

Nationally Adopted Franchisee & Regional Innovations

Many of the products and features people commonly associate with McDonald's today did not originate in the McDonald's Corporate offices, but rather were developed by local franchisees or regional leaders, in response to specific customers needs they saw. Here are some examples.

Ronald McDonald, 1959

Washington, D.C. operators John Gibson and Oscar Goldstein (Gee Gee Distributing Corporation) sponsored a children's show on wrc-tv called Bozo the Clown, in an effort to attract children and families to their McDonald's stores. Bozo was played by Willard Scott on the TV show, and after the show was cancelled in 1962, Scott continued as the new mascot "Ronald McDonald" in a series of TV commercials. The character eventually spread to the rest of the country in an advertising campaign with a revised costume, and was no longer played by Scott. Later, an entire cast of McDonaldland characters was developed.

Filet-O-Fish, 1963

Restaurant operators in Roman Catholic neighborhoods of Cincinnati, Ohio, noticed their hamburger sales falling significantly during Lent, when many of their customers avoided eating meat on Fridays. Although Ray Kroc had long vowed that McDonald's would never sell sandwiches other than hamburgers, following the successful local introduction of a fish sandwich, McDonald's Corporation perfected the recipe and released it nationally the following year.

The Big Mac, 1968

A McDonald's franchisee in Uniontown, Pa., introduced this double-decker hamburger, which was later picked up nationwide and became a huge success, partly due to heavy advertising. (It is essentially a copy of a double hamburger first sold by a competing chain, Bob's Big Boy.)

Shamrock Shake, 1970s

Invented by a franchisee in Connecticut, as a special promotion for St. Patrick's Day

Scratch-off Game Card Promotions, 1970s

Invented by the Los Angeles franchisee advertising cooperative in partnership with Simon Marketing.

First Drive-Thru, 1975

Most standalone McDonald's restaurants offer both counter and drive-thru service, with indoor and sometimes outdoor seating. Larry Ingram, a regional manager based in Dallas, created the first drive-thru window in 1975 at a store in Oklahoma City. Customers from the nearby Tinker Air Force Base had recently been forbidden to leave their cars off base if they were not in uniform, and this innovation allowed them to buy their food at McDonald's. With a 28% increase in sales in the first year, this store was the first of eventually 90% of free-standing McDonald's locations in the U.S. to have a drive-thru window. Drive-thru service now accounts for more than 50% of sales.

Happy Meal, 1979

Regional advertising manager Dick Brams and the Kansas City-area franchisee advertising cooperative developed a clever package featuring a circus train design, and containing a hamburger, French fries and a soft drink. The idea was successful, and similar Happy Meal packages are sold nationally.

McSnack, 1982

A smaller McDonald's restaurant with a limited menu that fit into a small space in a shopping mall was the innovation of regional manager Jim Klinefelter in Minneapolis.

http://trex.id.iit.edu/~davidm/assets/McGaw-ID-McD-study.pdf

Mcdonalds Management

The McDonalds managers have adapted to a changing market over time - for instance, there is now more of an emphasis on healthier eating options to reflect current trends. Innovation at McDonalds has been used to good effect over the years, with successful promotions and menu options boosting sales.

Reducing the use of Antibiotics

Mcdonals and Enviromental Defense in 2003 establised a partnership to create a new

Purchasing policy to cut the use of antibiotics in poultry production. To create the policy,Mcdonalds worked with a various organizations that had a considerable stake in the process, including drug manufacturers, academic scientists and members of the medical community.

There are two major objectives of the partnership:

Retain eficacy of antibiotics for human health.

Responsible use of antibiotics in animal agriculture.

Result:

A global purchasing policy for McDonald's was created that:

  • Reduced an estimated 17,900 pounds of antibiotics used annually by McDonald's suppliers
  • In 2006 McDonald's top supplier, Tyson Corporate, announced that it had reduced antibiotic use by over 90% and the top four poultry companies in the U.S. all reported eliminating the use of human antibiotics to promote growth in chickens
  • We estimate that a total of 223,600 pounds of antibiotics have been reduced from poultry producers in the US since we completed the McDonald's partnership
  • Eliminated the use of medically important antibiotics as growth promoters in poultry
  • Outlined clear guidelines for the appropriate use of antibiotics
  • Created a purchasing preferences for suppliers who further reduced antibiotics use
  • Created a program for certification of supplier compliance

http://innovation.edf.org

McCafé: Strategic Innovation at McDonald's

While Starbucks and Burger King have been suffering this year, global sales have been increasing for seven months in a row at McDonald's.

Thewho-what-how modelof strategic innovation can be applied to illustrate what McDonald's did.How exactly is the McCafé a strategic innovation?

Let's have a look at the definition of Strategic Innovation again. Strategic Innovation is about:

  • newbusiness models(including a new value chain architecture), or
  • newmarkets(either by creating new ones or reshaping existing ones), or
  • increasedvaluefor both the customer and the company or a combination of these three.

Let's start with the new market: McCafé not only represents a new market for McDonald's, but looking at the customers of McCafés, one can see that they tap on new customers as well. First people who would not go to a McDonald's can be seen in restaurants now. For example parents who might just have gone in because their kids wouldn't stop begging, now enjoy a coffee along a piece of cake, while the youngsters are having a BigMac.

And the youngsters tend to stay longer in the restaurants as well, having a latte after the McMeal. McCafés are a blend between Starbucks and a regular McDonald's, with a cozier atmosphere than the regular McDonald's store. At the same time the coffee is cheaper than at Starbucks. So McDonald's is tapping into a market who can not afford, or is not willing to afford, a Starbucks coffee.

With the new design of McCafés they can still enjoy a little bit of 3rd place compared to a Burger King for example, which clearly respresents increased value for the customer and McDonald's at the same time, as it is profiting not only from the increased sales, but also the "better" image it is gaining among new and existing customer groups.

As for the new business model: the new store layout with combined restaurants and McCafés, or the new stand alone McCafés, are a new way of delivering value to the customers. The new layout and atmosphere invite people to linger in the shop for an extended period of time (like at Starbucks), instead of just hoping in for a quick bite (like you do at any regular fast food restaurant).

How can you use existing assets (like McDonald's used its locations) to create new value for existing customers or create a new market altogether?

(http://www.sevenprophets.com/2009/08/mccaf%C3%A9-strategic-innovation-at-mcdonalds.html)

Technological Innovation used by Mcdonalds

McDonald's to offer free Wi-Fi in restaurants

The fast food chain McDonald's is to introduce free high speed wireless internet access at most of its 1,200 restaurants by the end of the year in a move which will make it the UK's biggest provider of such a service.

Customers will be able to go online via their laptops, compatible mobile phones and games consoles for hours on end if they wish. The initiative goes a step further than existing services offered by some coffee shops and cafes, which provide Wi-Fi hotspots but charge users a fee.

McDonald's said its service would benefit a wide range of customers, from business people making a "pit stop" to check email between meetings to those looking for a leisurely break at the weekend to download music. It claimed a hotspot user who pays to log on for just an hour a week in a coffee shop could stand to save as much as £260 a year on premium Wi-Fi charges by using McDonald's free service. It has already introduced the free scheme in 8,000 of its 13,000 outlets in the US.

The company's president and chief executive officer, Steve Easterbrook, said: "We hope that this will be a breath of fresh air and give greater choice for Wi-Fi hotspot users who have had little choice but to pay by the month or hour to access the internet on the move." Faced with the prospect of young people spending hours surfing the net after buying just a single cup of coffee, a spokesman for McDonald's said: "We would be comfortable with that. There will be no restrictions."

The editor of Computing, Bryan Glick, said: "The future of technology is in secure, wireless, mobile, go-anywhere computers and anything that helps people achieve that is a step in the right direction."

http://www.guardian.co.uk/technology/2007/oct/06/internet

Websites

  • http://www.aboutmcdonalds.com/mcd/our_company.html visited on 10 -12-2009
  • http://en.wikipedia.org/wiki/Mcdonalds visited on 10-12-2009
  • http://www.mcdonalds.ca/en/aboutus/history.aspx visited on 10-12-2009.
  • http://www.sevenprophets.com/2009/08/mccaf%C3%A9-strategic-innovation-at-mcdonalds.html visited 10-12-2009
  • http://www.guardian.co.uk/technology/2007/oct/06/internet Rebecca Smithers, consumer affairs correspondent The Guardian, Saturday 6October 2007
  • http://www.bbc.co.uk/worldservice/specials/1616_fastfood/page9.shtml

Biblography

  • The sign of the burger: McDonald's and the culture of power

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