UNIT 5, assignment 3: Strategies and Resources:
In this report I will be researching Mcdonald’s, I will explore the different strategies they use to conduct
business successfully across different countries. I shall also include the different types of resources that
Mcdonald’s use to make trading internationally viable.
P8:Explain how products and processes have to be adapted for international markets by a selected business:
Firstly, Mcdonald's ownership of their businesses tend to be franchised, this means that the franchisor can sell th
rights of the company to an independent company, known as the franchise. The benefits of franchising include
lower risks as it isn’t an independent business with more liability, but it also helps financials as money becomes
easier to secure when you are a franchised business, and finally, franchised businesses already come with an
established plan. Another method sometimes used by Mcdonald’s is subsidiary business, this is when the
company belongs to another company, for instance, a parent company. The advantages that follow a subsidiary
business is first that they can establish their management style and also gain their brand recognition. Another
thing is that the subsidiary may be able to entice customers who are not interested in the parent company, which
opens up the customer market for that business. These two types of business owners make it simplistic for
Mcdonalds to expand into overseas markets, therefore this allows the franchisor to enhance its customer base
abroad in a larger, global market.
Mcdonald’s processes vary from country to country as they need to conduct large amounts of different research
to collect the correct information for the country they would like to launch in. They need to conduct surveys to
get a clear understanding of what type of products customers will want to see and purchase, as this will not be
the same from country to country. The company needs to consider the different advertising skills and platforms
that they will be shown on as not all countries will broadcast certain adverts. Costing in each country needs to be
considered as import costs will vary as well as minimum wages for each business, therefore labour might be
relatively expensive in certain places. A big factor that needs to be considered for different countries is the
supplier of goods, and how reliable they will be at delivering the quality and demand of certain items Mcdonald
might like to offer in specific regions.
, Mcdonald’s then
takes into
consideration all
the different
cultures and
customer
preferences that
people would wan
from their product
and processes. For
instance, products
that sell extremely
well in one
country, such as
the original Big
Mac burger in America, would not sell as well in a country like Dubai. The reason behind this is down cultural
differences, due to people being Halal, Mcdonald’s has to incorporate this into their meals. So instead of selling
beef patties, they substitute it is for 100% halal beef
patties in Dubai.
This is the first example of how Mcdonald’s would have to adapt their products to suit international markets and
customers, otherwise, they wouldn’t be able to sell their products very efficiently in certain countries if they
disregarded certain elements as stated above. Mcdonald’s does not only have to be conscious of cultural
differences but also changing trends within society. This includes people being more health-conscious, therefore
as Mcdonald’s was predominantly an unhealthy, fast food brand; people will be reluctant to go and purchase
meals. However, this is when the innovation of products steps in and they started to release healthy alternatives,
such as fruit bags for children, smoothies, the fish fillet burger and so on. This was an act to entice customers tha
wanted to be healthy to still spend their money with Mcdonald’s, especially when it came to the children’s happy
meals as parents could now feel better about treating their children to a Mcdonald’s. Next, a vegetarian and
vegan trend also started to grow, this was Mcdonald’s next step to introduce options that would accommodate
their vegetarian or vegan customers.
Mcdonald’s successfully released a handful of vegetarian options, as seen below, however are still in the making
of releasing vegan options that are purely plant-based items. There have been hints of a veggie sausage or even a
plant-based burger in the future to come!
