The Global Leading Food Service Retailer Commerce Essay

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McDonalds is the global leading foodservice retailer with more than 32,000 local restaurants serving more than 58 million people in 118 countries each day. More than 75% restaurants worldwide are owned and which is operated by independent local men and women. McDonald's has a strong value of strategy offering its product at relatively low prices. Their strategies for globalization and diversity are instrumental to the overall success for the company.

McDonald's centers mentioning ethical codes of practice within its mission statement. McDonald's has issued a Social Responsibility Report with the attention to relations with its local community, employees, environment, and market place.

a) McDonald's Rights, Conflict and responsibilities:

McDonald's extended any time limit or waives any of their Rules where people have been disqualified.

McDonald's can terminate, suspend or extend any kind of promotion at any time due to supervening circumstances. McDonald's control including technical or operational problems with the Site or for any fact, matter or circumstance which fair or secure conduct or operation of any aspect of this promotion or its administration.

Substitute product deemed to be an appropriate replacement and the equal or greater value in the place of the prizes. McDonald's decision in the exercise of its rights.

Medical benefits for the employee

Vision supplement plan benefits for the employee

Dental benefits for the employee

Flexible spending accounts benefits for the employee

Short and long term disability benefits for the employee

Employee and dependent life insurance benefits for the employee

Accidental death & dismemberment (AD&D) benefits for the employee

Travel and business travel accident insurance benefits for the employee

Base pay benefits for the employee

Incentive pay benefits for the employee

Company car program benefits for the employee

Recognition programs benefits for the employee

Profit Sharing and Savings Plan (includes our 401(k) feature) benefits for the employee

MCDirect Shares benefits for the employee

Mc$ave benefits for the employee

Credit union benefits for the employee

Financial planning services benefits for the employee

Beyond Work Internet discount program



Anniversary Splash

Sabbatical program

Summer Hours

Leave of absence

Alternative Work Approach

Adoption assistance

Child care discount

Educational assistance

Matching gifts program

Employee Resource Connection

Auto and home insurance group discount program

International Fitness Club Network

b) Marketing: McDonald's is the global leading foodservice retailer. McDonald's identifies the various stages in their marketing process. The brand image represents the consumers View. Branding works when an organization behaves and presents them in a consistent way. Marketing communication methods like advertising and promotions are used to create the colors, designs and images that give the brand its recognizable face. McDonald's represented by its familiar logo like the Golden Arches. McDonald's faces competition from other businesses and organization. McDonald's using their marketing policy depends on four main marketing tools such as:





c) Professionalism: McDonald's is very much professional in their business. Its operating income was $6,443 milion in 2008 where net income was $4,313.

d) Information Technology: Technological improvement is the greatest adventage for the McDonald's. They are using the software for taking order, cash maintain, defining sale, expencess, profit, stock control etc. that's means McDonald's using technological adventage every step in their business.

By using internet facilities McDonald's sharing all the branches information all over the world. So management can take the quick decition and control their all restaurant.

e) Communication: McDonald's have a strong communication with branch to branch and with head office. All branches can share the information each other via their website and email service. By a computer we can maintain our full business. We can keep the order, record of transjection, maintain accounts etc. Computer and their software is the great adventage for the McDonald's. For that reason McDonald's can povide the quick service to their customer, supplier, investor.

f) Freedom of action: McDonald's is very flexible workplce because Employee get a lots of benefit to work in McDonald's. This information highlights McDonald's benefits for the Staff (e.g., home office, division or region office) McDonald's benefits program is designed to attract, energize, reward and retain talented people who are producing superior business results brings market leadership position. We can discuss the employee benefit by four categories.

Health and Protection benefits by Health and insurance:


Vision supplement plan


Flexible spending accounts

Short and long term disability

Employee and dependent life insurance

Accidental death & dismemberment (AD&D)

Travel and business travel accident insurance

Pay and Rewards benefits Like compensation, reward program:

Base pay

Incentive pay

Company car program

Recognition programs

Investment for the future like saving, investment program:

Profit Sharing and Savings Plan (includes our 401(k) feature)

MCDirect Shares


Credit union

Financial planning services

Balance work and life based on work /life benefits:



Anniversary Splash

Sabbatical program

Summer Hours

Leave of absence

Alternative Work Approach

Adoption assistance

Child care discount

Educational assistance

Matching gifts program

Employee Resource Connection

Auto and home insurance group discount program

International Fitness Club Network

Beyond Work Internet discount program

g) Censorship on internet: McDonalds doesn't show a lots of information in internet.

How to make the food

How much souce use in a burger

Supplier Information etc.

h) Computer and work: Computer is a great part of communication. By a computer we can maintain our full business. We can keep the order, record of transjection, maintain accounts etc. Computer and their software is the great adventage for the McDonald's. For that reason McDonald's can povide the quick service to their customer, supplier, investor.

In Mcdonald's someone taking the order from the customer at the front counter, same time orders comes to the kitchens computer screen and kitchen people make the food imiditely. Which is the faster way to serve the customer fress food within a short time.

When employee clock in for the work management can see the % of labour imidietly and they can control them.

Manager can check branch sale and expencess at any time.

Because of computer facilities manager can check their food stock level.

By using computer McDonald's managers can communicate with branch to branch or headoffice. They also share the information.

i) Law: McDonald's more than 32,000 local restaurants in 118 countries. That's why McDonald's follows particular country's company law.

j) Security: For the security reason company spend lots of money every year. Because McDonald's think about their business and customer, both will be safe.

Use CCTV for the customer and business safety.

Spending more money to improbe their website and website security.

Using Fire alurm and fire prevent instrument for the safety.

Adopting new technologies to chech and maintain the food quality.

Question 2

a) The Legal System in Tonga:

the Constitution of 1875

the statutes of the Legislative Assembly approved by the King

the common law and rules of equity of England and statutes of general application in force in England from time to time, only so far as no Tongan statute applies and so far as is permitted by the circumstances of Tonga and its people (Civil Law Act - Cap 14).

The Kingdom of Tonga was granted on 4 November 1875. Which was located in the South Pacific Ocean and Tonga's total area is 748sk km. Amendments have been made since that time and have been incorporated in accordance with the Laws Consolidation Act on 31 December 1988; and in 1990, 1991, 1997, 1999 and 2003.

The Constitution details the basic elements of the Tongan system of Government by defining:

Principles of equality and social justice that will be upheld;

structure of the legal system;

Roles, responsibilities and powers of the Executive, the Legislative Assembly and the Judiciary; and details related to land.

b) Source of Law:

Granted by His Majesty King George Tupou I on the fourth day of November One thousand eight hundred and seventy-five and amended in accordance with the law on divers dates in and between the year One thousand eight hundred and eighty and the year One thousand nine hundred and eighty-eight and revised in accordance with the Laws Consolidation Act on the thirty-first day of December, 1988.

The 1966 Act to amend the Constitution had not, as at 31 December 1988, been brought into operation but the amendments made by it are included in this Revised Edition. Each section affected is noted to this effect. The amendments relate to the Court of Appeal. The Act not yet in force is the Constitution (Court of Appeal Amendment) Act, 1966; Act 13 of 1966.)

c) Tongan Court Structure

The diagram shows the Court structure in Tonga



A body appointed by the King to assist him, rather than a court.

However, the Privy Council has jurisdiction to hear appeals from the Land Court in relation to hereditary estates and titles.


All the powers have of the Supreme Court and exclusive jurisdiction to determine criminal and civil appeals from the Supreme Court.

Appeal lies as of right from all civil decisions except

where the amount involved does not exceed $1000;

From an order made by consent;

From an order as to costs;

Interlocutory decisions; and

Where leave of the Supreme Court judge or of the Court of Appeal is required.

Has jurisdiction to hear appeals from the Land Court except in matters relating to the determination of hereditary estates and titles, where appeals lie to the Privy Council.

Both the Supreme Court and the Land Court may refer a point of law to the Court of Appeal by way of case stated.

Judges of the Court of Appeal are also empowered to give opinions on important or difficult matters when requested so to do by the King, the Cabinet or the Legislative Assembly.


Have all the powers of the magistrate's courts and appellate jurisdiction in relation to decisions of the magistrate's courts.

Has civil jurisdiction in:

Cases where the amount claimed exceeds $500;

Is empowered to try all indictable offences and has criminal jurisdiction in relation to all offences that carry a maximum penalty of a fine that is more that $500 or a period of imprisonment exceeding two years.



A magistrate's court constituted by the chief police magistrate has jurisdiction throughout Tonga. Other magistrates may exercise jurisdiction within the district to which they are assigned.

Every magistrate has the following general powers and jurisdiction in civil cases:

to make orders for maintenance;

to issue subpoenas for witnesses;

to enforce payments;

to take affidavits and administer oaths;

to exercise powers set down by law;

to make temporary orders where prompt action is needed; and

All magistrates have jurisdiction with regard to hearing and determining criminal matters in which the prescribed punishment does not exceed a fine of $1000 or a period of three years' imprisonment. In addition, the chief police magistrate has jurisdiction to hear cases in which the fine provided by law is no more than $1500.

Land Court:

Apply the Land Act 1927 and address all questions of title affecting land or any interest in land and Land Court is established under s144 Land Act 1988.

d) Types of Company Allowed in Tonga:

Sole Proprietorship: This structure is fully owned by one person. It does not need to be registered, but a relative business license should be obtained, in order to get a permit to conduct a business activity.

Partnership: Two or more entities can create a partnership, in order to operate under a single name; Partnerships need not be registered, but must obtain a business license.

A Branch of a Foreign Company: In order to operate in Tonga, a foreign company should first of all obtain a foreign investment certificate and then apply for a specific business license. After these documents have been received, a foreign company may start a registration procedure with local authorities in Tonga by submitting all the requested documentation. Foreigners cannot buy or sell land in Tonga, as well as they are not allowed to participate in business activities in certain market segments. In addition, when starting a business, foreigners have to deal with too complicated and time-ineffective bureaucratic procedures.

Local Company: Even though Tongan Companies Act is largely based upon New Zealand's model, it still has many gaps and inefficiencies. Local commercial legal framework is complex: some of its areas, such as the labour market, are understandable and lightly regulated, while other segments are hard to understand and comprise many uncovered gaps. Such a legal environment makes it much harder and more risky to conduct a business in Tonga than in many other jurisdictions.

In order to be registered as a Tongan company, the majority of shareholders must be Tongan nationals.

e) Laws Relating to:

I) Copyright: Copyright protects the physical expression of ideas. As soon as an idea is given physical form, e.g. a piece of writing, a photograph, music, a film, a web page, it is protected by copyright. There is no need for registration or to claim copyright in some way, protection is automatic at the point of creation. Both published and unpublished works are protected by copyright.

Copyright is regulated by law, the main statute in the Tonga being the Copyright Designs and Patents Act 1988 (CDPA). COPYRIGHTACT 2002, Act 12 of 2002 AN ACT TO PROVIDE COMPREHENSIVE PROVISIONS WITH RESPECT TO COPYRIGHT.

Copyright law grants to copyright holders certain exclusive rights in relation to their works. They have the right to: copy a work, issue copies to the public, perform show or play it, make adaptations or translations. They also have the right to prevent:

III) Patents:

A patent is a set of exclusive rights granted by a state to an inventor or his assignee for a limited period of time in exchange for a disclosure of an invention

Industrial Property Act, 1994

II) Trademark

is a distinctive sign or indicator used by an individual, business organization, or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or services from those of other entities.

Law: Under Patents

Question 3

a) Globalisation :

After Second World War every country suffers for economical problem. Company try to re-established their production and service. To survive and profitable this company everyone searching new markets for business. At first America and its Alai countries likes United Kingdom, France, Germany thinking about their economical growth. Many agreements signed between in these countries to business. Lancaster, Massingham & Ashford (2002) stated that one of the most striking business trends of the past 30 years has been the increase in global marketing; that is the growing of firms that view marketing opportunities on a global basis. Companies looking for opportunities in foreign markets are not new occurrences; after all, nations have traded ever since the start of commerce. In 1990s was really the first decade when companies around the world started to think globally. Time and distance have been rapidly shrinking with the advent of new and faster communication, transport and financial flows. According to Milward (2003) "globalization as an identifiable concept, it may be represented by the movement of goods, services, capital and labor around the globe in a coordinated and institutionalized interconnectedness, in which a set of global relations are established that ensure efficiency in the use of the world's scarce".

The increase trend for Globalization, the power of the new technology, the global flow of information, and the economic integration makes the entire big organization to go cross- border for business. These constant changes in the world require genuine perspectives for today's global organization. Thus, globalization commands firms to expand beyond borders as much as possible rather than focus on making profits in their local area.

Globalization affected almost every people in almost every nation. Its start from the economic then social to culture, this widespread exchange of goods, services and ideas have influenced changes around the world. Even though the cultural influence in globalization is of slight significance to policy makers, its power has astounding consequences to the nations involved and its people. Food is one of the most important elements in defining culture in all over the world. Any changes in the foods that we eat, in its preparation, the way of served and consumed make less the traditional beliefs for the people.

McDonald's globalization has raised so many debates on both sides of the issue. The pro- globalization belief is that it increases culture rather than adulterate. "The most communities, McDonald's has conformed to the local culture not the other way around. McDonald's corporation notes that most of its overseas franchises are locally owned and they make efforts to buy from local communities. McDonald's set its regional menus conform by the local taste." Radley Balko, 2003.

b) Development in Information: McDonald's is the largest chain restaurant in the world Dick and Mac Donald, two brothers, opened first McDonald's restaurant in San Bernardino, California in 1940. In the beginning McDonalds owned a hotdog stand, but after establishing the restaurant start served around 25 items, where most items were barbequed. It becomes a popular restaurant. Dick and McDonald's shut down their restaurant for thee months for alternations, In December they reopen with self service drive in restaurant and they also reduce their menu in items: hamburger, cheeseburger, soft drinks, milk, coffee, potato chips and a slice of pie. As per McDonald's information major revenue came from hamburgers which were sold at a nominal price 15 cents.

McDonald's gradually became famous as a restaurant and brother begin nationwide franchising their restaurant. In 1953, the first franchise was taken by Neil Fox. The second McDonald's opened in Phoenix, Arizona. It was the first to feature the Golden Arches design and later this year the original restaurant in San Bernardino was rebuilt in the same style.

In 1954, Ray Kroc, a Promoter and milkshake-mixer salesman acquired the franchise of McDonald's restaurant for outside California and Arizona. By this effect, Kroc opened his first and overall ninth restaurants in Illinois, Chicago, and he gave birth to Mc Donald's Corporation. The restaurant chain sold nearly 100 million hamburgers in1958. Kroc renamed the McDonalds in 'McDonald's Corporation' in 1960. Kroc convinced McDonald brothers to sell the business rights to him for a sum $2.7milion, in 1961.


Hamburger University was founded in 1961, gave away McDonald's restaurant Bachelor of Hamburgology degrees to students. The first restaurant of McDonald's was opened outside US in Richmond, British Columbia. In Woolwich, United Kingdom the 3000th restaurant was opened in 1974, which was the first of the country. In 1979, Happy Meal was introduced in US and the company became the main sponsor of the Summer Olympics In 1984. 14th January, 1984 was also marked by the death of Ray Kroc.

 In 1988, the first restaurant was opened in Belgrade, Yugoslavia, which a communist country followed by the first Soviet restaurant in Moscow, 1990. Breaking the opening day sale the McDonald's was open in Warsaw, Poland, in 1992. The largest McDonald's was opened in Beijing, China, in1992, having more than 700 seats and was

In 2003, McDonald's premium salads were added to the national menu and the company launched the 'I'm lovin' it' campaign. In 2006 McDonald's introduced the Snack Wrap in us and the chain also announced that they will publish nutritional information on their packaging of all their products, for the benefit of the customers. This way brand McDonald's has become, the food chain is spread across the major cities of the world.

In 2008, McDonald's introduced its new generation of global packaging, the most comprehensive rollout in the Brand's history. All 118 countries and more than 31,000 McDonald's will participate in this rollout over the next two years where more than 75% of McDonald's restaurants worldwide are owned and operated by franchisees and affiliates. Putting the Brand's food quality story front and centre and directly into the hands of customers in an easy and fun way, where they were connected with more than 58 million customer every day

Communication and technology: Computer and Software are the base of communication for the McDonald's. Technological factor includes the ecological and environmental aspects, such as R&D activity, automation, technology incentives and the rate of technological changes. They can determine barriers to entry, minimizes efficient production level and influence outsourcing decisions. Furthermore, technological shifts can affect costs, quality, and lead to innovation.

c) Culture:

Some of these concern which affects the issues of food culture and globalization. Most of them arise as a result of the introduction of fast food restaurants like McDonald's into diverting cultures around the world. Some changes were embrace by the population while others were seen as a threat to the way of life that has been established for the centuries. Some were adverted to the idea of globalization as a hold and perceive McDonald's as a representation of this ideal and as a result hold them responsible.

Even though there have been many changes in the eating habits of the nations influenced by the introduction of McDonald's there has been many positive aspects. Because of technological advancement and communication the world is moving at a faster pace. For this reason fast food into foreign cultures allows their opportunity to keep up with this fast pace. By the effect of Culture changing McDonald's take another step in the evolution of culture McDonald's changes in has brought about. The menu has serving people a new choice following the traditional foods eaten in the past.

McDonald's institutions spread across continents giving raise the number of indigenous fast food chains. We can talk about the case of Asianization where Fried rice was rapidly spreading all over the world by Asian cuisine. Unemployed youth were taking advantage of the McDonald's institution to set up fast food businesses on the street. This could be called fast-food street food. There was good and bad sides to this phenomenon therefore we need to find out the bad sides and improve them. There were Some traditional foods may also come with problems especially in terms of health, so while we criticize fast food we should also analyze some traditional food at least for their nutritional importance.

e) Politics: Political factors are how a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labour, environmental law, trade restrictions, tariffs, and political stability. Political factors may also include goods and services which the government wants to provide.

In McDonald's there are some government issue like average menu price increased by 3.2 percent, rapidly change of the taxing process which is directly effect on the business process. Vat policy by the government also affects McDonald's. e.g. "Labor is under fire from within its own ranks for having sold sponsorship of a party conference event attended by Prime Minister Tony Blair to fast food giant McDonald's. A Guardian newspaper report on the party's regular sale of commercial opportunities at its annual conference puts the cash due to be raised from the week-long event this year at more than £4m." BBC NEWS

f) Laws: Legal factors include discrimination law, consumer law, antirust law, employment law, and healthy and safety law. These factors can affect how a company operates, its costs, and the demand for its products.

g) Choice:  Different company have different strategy for their organization towards the health problem which can be obtained by eating or depending on fast-food, McDonald's industry and others fast-food retailer were facing veto vote from their customer such from mothers, teens that would require a broader of menu choice by the customer. As a part of strategy, for healthy lifestyle and living, McDonald's committed for their food and menu innovation. McDonald's make their McNugget from pressed chicken that like their hamburger patty or a different miscellaneous parts that were combined and pressed into an easily workable whole. For that reason McDonald's introduced their premium chicken nugget make with the breast meat only. Company also offers salad instead of shaken salad which is composed primarily from shredded iceberg lettuce with a mixed salad that contains sixteen different types of lettuces. Furthermore, Mcdonald's also offers new items in their menu that includes varieties of fruits, McGriddles, crispy and spicy options for their customers (2006).