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Unit 1 - Exploring Business
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Nabeel Choudhury
Unit 1 – Exploring Businesses
Assignment One
Success of Contrasting Businesses
I enquired to create a report on two contrasting businesses that have different types of
ownership and liability. The two businesses which I have selected are:
McDonald’s
Children in Need
Section One:
McDonalds
McDonald’s is
one of the
largest American
fast food
businesses that provides a service with new
12
headquarters in Chicago, Illinois, United States from Oak Brook, Illinois. McDonald’s was
founded by Richard and Maurice McDonald in 1940 and in 1954 Ray Kroc joined as a
franchise agent after witnessing the potential McDonald’s had with their 6 franchises. He
later proceeded to buy the chain from the McDonald brothers by taking 1.9 percent of the
gross sales whereas the McDonald brothers got 0.5 percent with maintaining a small
number of restaurants that caused conflict.3 Ray Kroc eventually bought them out for $2.7
million-cash in 1961 as he wanted full control however, he wasn’t aware that the deal did
not include the original McDonald’s in San Bernardino. 4 He was able to get them out of
business by creating a franchise one block away and now Kroc was able to successively run
McDonald’s. Unfortunately, Ray Kroc died on January 14, 1984 at the age of 81 as the chain
had thrived that year with 7500 outlets in the United States and 31 other countries and
territories.5 It was then taken over by James A. Skinner who started off as a restaurant
manager trainee without graduating from college and worked his way up to become CEO of
McDonald’s.6 McDonald’s offers a very popular uniform menu that includes “Fries, the Big
Mac, chicken sandwiches, chicken nuggets, hamburgers, quarter pounder with cheese,
salads, wraps, desserts, soft drinks, and other beverages.” 7 McDonald’s corporate mission is
“to be our customers’ favourite place and way to eat and drink.” 8 This mission statement
reflects the significance of customers as their primary focus, while maintaining the company
,Nabeel Choudhury
Unit 1 – Exploring Businesses
Assignment One
as a major influence on their food and beverage purchase decisions. McDonald’s corporate
vision is “to move with velocity to drive profitable growth and become an even better
McDonald’s serving more customers delicious food each day around the world.” This vision
statement is included within their growth plan that they introduced in 2017. Their previous
statement was “Our overall vision is for McDonald’s to become a modern, progressive
burger company delivering a contemporary customer experience.” McDonald’s aims and
objectives are to serve good food for a great value in a friendly, fun environment as well as
being a socially responsible company that provides good returns to their shareholders. 9
Furthermore, McDonald’s is in the primary, secondary and tertiary sector where they are
responsible for raw materials such as farming animals, the manufacturing process where
they convert raw materials into products such as the packaging and finally the service that
McDonald’s provides such as the food they sell to the consumers. The business works with a
number of suppliers to deliver the very best quality for each part of their menu without the
need for factories to produce the ingredients. With McDonald's main focus being the
tertiary sector, it contributes to their success because they provide fast-food such as burgers,
fries and drinks to customers in return for money. Their broad target market offers a friendly
and fun environment for everyone from children that love their Happy Meal® to workers
that can have breakfast with beverages and free Wi-Fi. 10 Furthermore, they remain as one of
the best food chains in the world as they are ranked 2 nd alongside their high customer loyalty
that enables repeat custom.11 This is inspiring as their success within the tertiary sector has
had a major impact on modern society today. McDonald’s are a global business as they
operate in over 100 countries and territories such as Brazil, Argentina, and Poland etc. With
McDonald's being a global business, it contributes to their success because they are
generating more sales and revenue by selling their food across different countries than just
one. Another benefit is that there are opportunities to expand into new markets where
there is a demand for fast food to gain more brand recognition and publicity. McDonald’s
strategy has helped them in cutting down costs and improving margins with the business
booming with 18% year-on-year, revenue reaching $21.03 billion and close long-term goal of
95% with current figure is at 92.7% of McDonald’s restaurants to be owned by franchisees. 12
McDonalds have limited liability as they are currently operating as a public limited company
(PLC) which is when a business has shares but is sold on the stock exchange. With
McDonald’s operating as a public limited company (PLC), it contributes to their success as it
offers their shares on the stock market as well as raising finances with the support of
shareholders. Consequently, shareholders appoint directors to control the management of
the company in addition to a plan for the future. This can be valuable as shareholders have
an interest in business operations since they are counting on the business to remain
profitable and provide a return on their investment in the business. With McDonald’s having
9
https://www.mcdonalds.com/gb/en-gb/help/faq/18508-what-are-mcdonalds-short-term-and-long-term-
goals-and-objectives.html
10
https://www.mcdonalds.com/gb/en-gb/help/faq/18506-who-is-your-target-market-audience.html
11
http://www.thedailyrecords.com/2018-2019-2020-2021/world-famous-top-10-list/traveling/best-fast-food-
chains-world-largest-most-popular/6524/
12
https://www.forbes.com/sites/greatspeculations/2019/02/04/mcdonalds-reports-good-results-to-continue-
growth-in-2019/#6ae4003119ec
2
, Nabeel Choudhury
Unit 1 – Exploring Businesses
Assignment One
limited liability it means owners will not be personally liable for any financial losses made by
the business. A limited company can therefore give McDonald’s added protection if things go
wrong. McDonald’s is a large business with being accompanied by 1.9 million full-time
employees that work 21-35 hours per week or 20 hours per week for part-time applicants
that need flexibility.1314 With McDonald’s being a large business, it contributes to their
success because they can use the method of risk bearing to utilise their products so that if
the demand falls on one product, they can still use the others to generate sales. Another
benefit is that they can invest more money into advertising so that the business can become
even bigger by promoting their newest product such as the new ‘Double Quarter Pounder
with Cheese®’ on a variety of platforms.15
Children in Need
Children in Need is a UK charity that is ran by the BBC. Since 1980, it has raised over
£1billion for disadvantaged children and young people within the UK. 1617 Every year in
November, Children in Need has an appeal night where they arrange an evening full of
entertainment, with celebrities that will make fools of themselves to help raise money.
There are vast number of volunteers who are there to answer phone calls when people want
to donate money however, people can now donate online via text, PayPal etc. The BBC's first
broadcast charity appeal took place in 1927, in the form of a five-minute radio broadcast on
Christmas Day. They managed to raise around £1,342 (equates to £69,950 by today's
standards) which was donated to four children's charities across the UK. The popular mascot
which fronts the Children in Need appeal is called Pudsey Bear which was created and
named in 1985 by BBC graphic designer Joanna Lane. The bear was named after her
hometown of Pudsey, West Yorkshire, where Joanna’s grandfather was the mayor. In 2007,
“Pudsey's bandana had multi-coloured spots, and all of the buttons were removed. By 2009,
Pudsey had been joined by another bear, a brown female bear named "Blush". She has a
spotty bow with the pattern similar to Pudsey's bandana pattern.” Children in Need’s vision
is that every child in the UK has a childhood which is safe, happy, and secure and allows
them the chance to reach their potential. 18 Their aims and objectives are to support small
organisations which empower children and extend their life choices. Moreover, they provide
grants to projects in the UK which is focused on children and young people who are
disadvantaged.19 Children in Need said it was supporting more than 3,000 UK projects while
reaching more than 580,000 people in the past year. 20 Children in Need have limited liability
as they are operating as a not-for profit organisation which is when all of the money earned
13
https://en.wikipedia.org/wiki/McDonald%27s
14
https://www.mcdonalds.com/gb/en-gb/help/faq/18378-what-do-mcdonalds-class-as-full-time-and-part-
time-hours.html
15
https://www.mcdonalds.com/gb/en-gb/product/double-quarter-pounder-with-cheese.html
16
https://en.wikipedia.org/wiki/Children_in_Need
17
https://www.bloomsbury-international.com/blog/2013/11/15/what-is-children-in-need-and-who-is-pudsey-
bear/
18
https://www.bbc.co.uk/programmes/articles/5J1sppRQGKQ20k75DGB313L/what-we-do
19
https://www.answers.com/Q/What_are_the_aims_and_objectives_of_children_in_need
3
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