As long as we can trace the history of McDonalds probably starts from a ‘Hot Dog’ stand from the early 1930s. Oh boy! Oh boy! No wonder why McDonalds are still the king of the ring! From ‘Hot Dogs’ to ‘I am loving it!’ McDonalds’ journey was fascinating indeed. The largest food chain in the world has the right to brag about the impact it has left on the course of the fast food history. Today, people from all around the globe recognizes the ‘Golden Arches’ as one of the most lovable signs.
SWOT Analysis of McDonalds Corporation
Strengths, Weakness, Opportunities and Threats of McDonalds
The Strengths, Weakness, Opportunities and Threats of McDonalds are quite an interesting debate currently going on in the fast food chains industry. As we speak, here are a brief discussion about the McDonalds SWOT :
Strengths: The King of the Ring
The Strengths of McDonalds
The Food that Everyone Loves: You are probably an Alien to us if you say that you haven’t heard of a Big Mac and fries meal. I mean come on! Big Mac, fries, Chicken Nuggets, Filet-O-Fish, Happy Meal, Double Cheese burger, Premium Salads all these are the most mouthwatering servings McDonalds offers to their customers.
Keeping the Lead in the Game- Adaptive Menu: McDonalds has faced many criticisms over the years. But it has always fought back with a punch on the haters’ faces. Remodeling the menus, making health conscious meals has been one of the strengths of McDonalds. Premium Salads, Filet-O-Fish has been some of the ground breaking add-ons on the menu.
The King of the Ring- World Largest Food Chain & 2nd Largest Private Employer: As of 2018, McDonalds is standing tall with 69 million happy customers and 37,855 outlets around the globe. That makes McDonalds the world’s largest restaurant chain. After Walmart, McDonalds has been ranked as the 2nd Largest Private employer of this planet. Happy faces are the strength of this lovable company.
The Real Estate Crusher: You may wonder why I have mentioned this point as the strength of McDonalds. But hold on to your breath folks because it’s gonna get hotter! McDonalds has 37,855 outlets around 120 countries which are mainly franchises. McDonald’s gains royalty from all the outlets as rents, land and even parking!
Weakness: The Tears behind the happy faces
The weakness of McDonalds are shown as follows
Unhealthy Fast Food- Say No to McDonalds: In 2004, Independent Filmmaker, Morgan Spurlock released a documentary titled ‘Super-Size Me’ where he was seen facing health issues while eating only McDonalds for a month. Many health conscious individuals and Nutritionists suggest that eating high fatty and salt foods like McDonalds are the main reason of people getting obesity.
Employee Satisfaction Issues: Though One out of Nine American workers has been reported to work in McDonalds once in their life time, McDonalds has been said to be a company that is ‘NOT Good’ with their employee relations. Low wages and mismanagement of shifting has been a hiccup for the said food giants.
Risky Investments and Business Policies: The Largest Restaurant franchise in world has been the talk of the town for taking some off the book business policies such as selling franchises, not burgers. This proves to be too overwhelming when it comes to sticking to the basics. Investing in new techs can be profitable, yet avoidable.
Inconsistency in Taste: As you expand globally, maintaining the standards of foods and the same aura are the big mountain you cannot wish to foresee. McDonalds had to face this wrath too. Due to the change in weather conditions and diversity in the fresh ingredients around the globe has been the main reason.
Opportunities Rays of Hope
The opportunities which are up for grabs for McDonald’s
The opportunities for McDonald’s
Bring Something New to the Table: If you are running a business, you know that the customers are always up for new delights. McDonalds are not an exception. Innovation is a must in the menus, in the drive-ins, restaurants and walk-ins. We love fries, but we will obviously try out the new Shakes on the card!
Expand & Explore: Globalization and Digitalization is the new trend now. You got to get to the customers’ doors, they ain’t coming to you anymore! Home Deliveries, Ordering Apps, Local Delights and Smart Restaurants are some of the sectors McDonalds can work on if they are willing to expand their empire more and more.
Remodeling the Business: Yes, selling franchises is good, easy money, I get that. But have you ever thought of getting your hands ON the real money? McDonalds should start getting involved directly into the business rather than selling the franchises to third party owners and gain royalty. They gotta hit the gas paddle!
Technology & Beyond: Innovation and expanding the use of modern day technologies are the go to if you are an empire as big as McDonalds. Smart apps, Ordering Panels, Innovative Sittings and Drive-Ins are some of the areas that can be the show stopper and a bloody sucker punch to the big rivals.
Threats: The Wolves are coming!
As it happens, every business has threats luring over the skies. McDonalds has some too.
The threats for McDonalds are as follows:
Risky Money Plan: Selling franchises can sometimes be a big mess if you are an empire. Sometimes restaurants will fail to show a profit or might have to be shut down due to some unavoidable circumstances. Who knows! Franchisees are not the real owners, they are just selling foods under your brand’s name.
Rivals Catching Up: McDonalds has always been under constant threat when it comes to the Big Rivals. Burger King, Subway, Taco Bells, KFC, Pizza Hut are the most prominent brands who are working relentlessly hard day and night to gain the ultimate throne off McDonalds’ head. McDonalds has to be aware of that.
Fast Food Vs. Health: It has been one of the most long lasting debates on fast food being unhealthy, the main culprit behind our fat bellies. But let’s face it guys, McDonalds has indeed been the largest fast food empire in the world. It will have to face this accusation one way or another.
Global Cultural Diversity and the Problems within: McDonalds has been the biggest consumer of meat items like pork, lamb and chicken around the globe. But as we all know that some cultures don’t support all kinds of ingredients that McDonalds use. You probably don’t want to shut down your business by feeding pork in a Muslim country.
Recommendation: How to Protect the Throne
When I say McDonalds then big smiles are seen on every faces. McDonalds has been a part of our lives as long as we can remember. From The Happy Meals to the Big Mac all the mouthwatering menus and the shakes and the drinks are soul scratchers. A little here and there, some makeovers and revamping the business model can be the game changer for the empire. Tough measures are the meant to be taken if you want to maintain the legacy. With the right steps and precautions people will be chanting ‘I am lovin’ it!’ over and over again.
Related:
- Marketing Mix of McDonalds
- McDonalds Advertising Expense Analysis
- How Much Costco Spends on Advertising?
Reference Links:
1. https://money.howstuffworks.com/mcdonalds1.htm
2. https://www.rd.com/food/fun/bestselling-mcdonalds-menu-items/
3. https://www.thrillist.com/eat/nation/healthy-mcdonalds-menu-healthiest-options
4. https://en.wikipedia.org/wiki/McDonald%27s
5. https://www.seriousfacts.com/mcdonalds-facts/ , https://en.wikipedia.org/wiki/McDonald%27s
6. https://www.statista.com/statistics/219454/mcdonalds-restaurants-worldwide/
7. https://g.co/kgs/DaVoSq
8. https://www.healthaffairs.org/doi/full/10.1377/hlthaff.22.6.207
9. https://www.cbsnews.com/media/11-things-about-mcdonalds-that-may-surprise-you/2/
10. https://www.marketing91.com/mcdonalds-competitors/
Sheikh Faizul Haque is an internet entrepreneur and the founder of The Strategy Watch; Graduated from North South University with a double major in Accounting & Finance in Bangladesh.
With a strong interest in developing and improving Business Strategy and to Conduct Business Analysis.