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Mc Donald’s History and PEST analysis

HISTORY

Mc Donald’s is one of the most well-known franchises of fast-food restaurants.

The first Mc Donald’s restaurant was opened in California by two brothers Dick and Mack Mc Donald’s. The main activity now of this fast-food restaurants is the leading global foodservice retailer with more than 35,000 local restaurants, serving nearly 70 million people in more than 121 countries, including Greece, each day.

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Mc Donald’s in Greece opened its first restaurant in 1991 at the Centre of Sintagma Square in Athens. The franchises were started in 1954, by Raymond Albert Kroc, a salesman. At the first years of the company, Ray Kroc made very little investments in order to increase the capital of the company for the new future investments. He was more concentrated in making a lot of profits and less investment but today this business has enlarged very much.

Today Mc Donald’s is one of the world’s most well known and valuable brands and holds a leading share in the globally branded quick eating- out. Some of favorite foods that Mc Donald’s serves are such as Big Mac, Egg Mc Muffin, Chicken Mc Nuggets, Happy Meal, Hamburgers and Cheeseburgers. Also here in Greece are served some special food for the Greek customers such as Mediterranean Salad, Greek

Chicken etc. In order to adapt the Greek culture.

Map of Mc Donald’s restaurants

PLANNING

Planning is crucial for a company since it helps the company to identify or select the goals of the company and the course of action that are needed. Administrative in Greece has set different short and long-term goals and objectives. The goal is not “growth for growth’s sake” but the systematic and balanced expansion of McDonald’s based upon the actual requirements of the Greek consumer.

So some of the short- term objectives are:

  • To reasonably price the excellent food and to serve fresh and hot, quickly and precisely in a clean friendly environment.
  • A new eating experience for consumers and their families
  • A rise of the total quantity of food served (it increase their income)
  • Carefully selected locations upgraded and renovated on a continual basis providing convenience and safety in all restaurants.

Some of the long-term objectives are:

  • To increase the number of local suppliers based however upon their comparative advantages.
  • To reduce the number of materials they use, to recycle what is possible and to use the recycled material for future needs.
  • To increase the working condition and workers salaries by increasing profit.
  • To train personnel at all McDonald’s levels.

DECISION MAKING

In McDonald company usually the decision-making takes place according to the threats or the opportunities that may occur at the time but most of the time decision- making is done by the experience the company has from previous years and the rules that exist in the company and it is usually programmed decision-making. Decisions are made by the owner or the director of the company consulting with the top managers who will decide about which decision to follow since they have more communication with the business outside world and judge the positive or negative consequences for the future of the company.

SOCIAL RESPONSIBILITY

McDonald’s name has won over the hearts of customers worldwide gaining their trust and acceptance. And on its part the company endeavours to return this trust with many social activities in the communities that host its restaurants. A fundamental social policy of McDonald’s in Greece is to support its community and to support a constant effort to fulfil its social goals which are:

  • To became synonymous with providing help towards young people in need.
  • To promote and support initiatives which originate from everyday members of the community.
  • To provide facilities products and human resources to support fundraising for both the community and for charitable purposes.
  • To encourage its employees to became volunteers as well offering its own facilities whenever and wherever possible.

At Mac Donald’s corporate social responsibility is part of the company heritage being carried from one generation to the next with the promise of expanding and becoming even more effective.

PEST ANALYSIS

To begin with, the external environment of McDonald company is stable. Usually, there is little effect from external environmental factors. In addition, we could say that the internal environment, in this case, is characterized by the applying of theory x and the situation is narrow and exist a chain of command. People have specific jobs to take care of and in general power and authority is centralized mostly among managers and sometimes employees are given authority also. So, in other words, we have a mechanistic operation.

POLITICAL ENVIRONMENT

In general terms the government policies do not affect the company much nor do the changes on the government influence the organization of the company. Mostly what company obligation to the government is the paying of the different taxes such as :

Business taxes

Payroll taxes

F.p.a. (19% of the total profit and 19% in the price of each product)

Health and social insurance for the employees.

ECONOMICAL ENVIRONMENT

There are many factors which can affect the operation of a company. In Greece at the beginning when the company was opened the interests rates the cheap labor, the fact that the economy was in a better condition that it is today and also the fact that Greece changed from a developing country to a developed one helped the company establish and start operating slowly at the beginning but later on quite successfully. Some of the negative factors however in this part was for example the fact that Greek people were still not used in eating foreigner foods or factors based on their economic status factors.

SOCIAL ENVIRONMENT

The business has been influenced by the changes made in the society especially changes among young people who helped in the acceptance of the fast-food idea but also the rapid change of way of life which is so quick since people are everyday running out of time helped in the preference of the company and in increasing its profits.

A negative aspect of a social factor happening in Greece is sometimes the fact that many times anti-Americans feelings raising for different reasons may a lot or a little affect the company by boycotting Americans goods. The business also is present in many activities and charities in order to help people who really need help and also by helping the company this way.

TECHNOLOGICAL ENVIRONMENT

It natural that technology help McDonald company and especially its employees since they have to serve quick services. Computers and smart cashiers are used in order for employees not to be confused and to have a practical job. What is more, modern appliances are used so as to prepare without many dangers and in a quick way, the food but also in some restaurants internet is being popular too.

ENVIRONMENT

McDonald as good neighbourhoods and good citizens help in keeping the local environment clean and attractive. Environmental preservation at the restaurant level involves a broad range of initiatives to conserve natural resources and minimize pollution and reduce waste in the company operation by : – recycling what they can, -using products made from recycled materials. To continue further, an electrical energy conservation policy is followed and also a rain forest policy that commits the company to purchase only beef that was not raised on rain forest or recently cleared rain forest land.

SWOT ANALYSIS

Strengths

*; The recognition of the importance relationship between a balance diet a healthy food and a good health.
*; The social responsibility of the company
*; The reputation of the various products each season.
*; The equal employment opportunity regardless of race, color, sex, national region, age, disability etc.
*; The recognition that the company has gained worldwide.
*; Good communication between staff.
*; Better products and prices versus its competitors.

Weaknesses

*; More advertising, better IT
*; It need better and faster communication between the different McDonald branches.
*; More elements in the business from a dynamic working environment.

Opportunities

*; The reasonable prices in comparison with its competitors.
*; The possibility of always being able to open to new markets.
*; The opportunities of using new and innovative technologies.

Threats

*; Decreases in consuming of fast food menus
*; Different forms of new competitors.
*; Other alternatives in the leading style.

STAFF

McDonald have many people working for them here in Greece about 1500-1600 who in many cases are offered many opportunities for career development. Many of the employees need technical skills and most of the managers and the administrative level have their degrees and experience in many fields in order to achieve the organizational goals. The company has some specific programs in order to pay employees qualification or for any foreigner language that is needed for employees to know various courses are offered.

McDonald’s objective is also to create a learning environment that allows maximum development of employee abilities. Training begins with orientation for all employees and continues with a structured development program. This program includes training in all areas of company operation and also covers areas such as Hygiene and Safety and Food Safety. Basic training for full time employees lasts approximately 6 months while for part time employees it continues for approximately 12 months. In general communication is in good level throughout the employees in all branches.

SUPPLIERS

The suppliers of the company are:

*; Usually firms that exists in different countries that McDonald’s restaurants

are for purchasing different materials for different products.

*; The coca cola company

*; Greek and us companies that supplies huge quantities of hamburgers to

McDonald restaurants.

CUSTOMERS

McDonald company has millions of customers all over the world. The ages differ from country to country but in overall almost all ages prefer to eat at McDonald restaurants. The customers demand reasonable prices and excellent quality from the company which is what the company always try to have and improve.

COMPETITORS

McDonald restaurants in Greece have two main competitors which are Everest and Goody’s restaurants which the three of them offer fast food services.

LEADING

In the company the people that have the higher positions plan very carefully how to lead the company because they want to have direction and coordination of things. What the company’s corporate level strategy is using is very mechanistic.

The corporate level strategy used is international expansion with mostly clues of multi domestic operation. The company tries to customize the local needs and sometime may charge higher prices and company advertising, marketing and searching is quite expensive.(single business)

Also, the business level strategy that is often applied in the company is the low-cost strategy making the company trying to have a competitive advantage versus other competitors.

CONTROLLING

Controlling in the company is made by the top levels and managers of each branch and sometimes from higher supervisors. The administrators are responsible for checking all papers related to the suppliers the quality used in the foods each weak etc. for every department and then report to the top manager. They are the people who decide the standards of performance and the goals and afterwards measure the actual facts in relation with the standards.

The types of control used in McDonalds company are such as: Output control with Financial measures and Operating budget, and also bureaucratic control based on beliefs norms values etc but also direct supervision is used a lot always in relation with the different levels of employees.

References:
• Mc Donald’s Corporate website, www.mcdonalds.com
• Mc Donald’s- Wikipedia, http://com.wikipedia.org/wiki/McDonald’s
• Adam S., Armstrong, G. Brown, L. Kotler (1998), Marketing, Prentice Hall,Australia
• Bateson, J.E.G, Hoffman,K. D., Managing Servises Marketing, The Dryden Press, London
• Fifield, P.,(1998), Marketing Strategy, Butterworth- Heinemann, Melbourne

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Mc Donald’s History and PEST analysis. (2021, Feb 07). Retrieved February 28, 2021, from https://essayscollector.com/essays/mc-donalds-history-and-pest-analysis/