Sneha Yadav
Sneha Yadav
Sneha Yadav
CERTIFICATE
This is to certify that Ms. Sneha Yadav of B.com (Accounting & Finance) Semester V (2023-
2024) has successfully completed the project on “A Study On Management Of Financial
Instruments of Mcdonalds & Burger King” under the guidance of Mr. Anand
Dharmadhikari
PROJECT GUIDE:
COURSE INCHARGE:
INTERNAL EXAMINER:
EXTERNAL EXAMINER:
PRINCIPAL
Seal of the
College
Date of submission:
Declaration by Student
I, the undersigned Ms. Sneha Yadav hereby, declare that the work embodied
Mcdonalds & Burger King” forms my own contribution to the research work
carried out under the guidance of Mr. Anand Dharmadhikari is a result of my own
research work and has not been previously submitted to any other University for any
Wherever reference has been made to previous works of others, it has been clearly
I, here by further declare that all information of this document has been obtained and
To list who all have helped me is difficult because they are so numerous and the depth
is so enormous.
I would like to acknowledge the following as being idealistic channels and fresh
dimensions in the completion of this project.
I take this opportunity to thank the University of Mumbai for giving me chance to
do this project.
I would like to thank our Director(Education) and Principal for providing the
necessary facilities required for completion of thisproject.
I take this opportunity to thank our Course Incharge, for her moral support and
guidance.
I would like to thank my College Library, for having provided various reference
books and magazines related to my project.
Lastly, I would like to thank each and every person who directly or indirectly helped
me in the completion of the project especially my Parents and Peers who supported
me throughout my project.
INDEX
Chapter No. Topic Page No
Literature Review
INTRODUCTION
McDonald's Corporation
McDonald's Corporation is the world's largest chain of hamburger fast food restaurants,
serving more than 68 million customers daily. In addition to its well-known restaurant
chain, McDonald's Corporation also owned Boston Market until 2007, had a minority stake
in Pret A Manger until 2008, and was a significant investor in Chipotle Mexican Grill until
that year.
A franchisee, an affiliate, or the firm itself runs a McDonald's restaurant. The company's
income is derived from sales in its own restaurants as well as rent, royalties, and other fees
paid by franchisees. Throughout the three years ending in 2007, McDonald's revenues
increased by 27% to $22.8 billion, and operating income increased by 9% to $3.9 billion.
Burgers, cheeseburgers, chicken goods, fries, breakfast dishes, soft drinks, shakes, and
desserts are McDonald's main product offerings. The company has adjusted its menu to
include items that are viewed as healthier, such as salads, wraps, and fruit, in reaction to the
Western world's rising rates of obesity and in response to customer complaints about the
nutritional value of its goods.
1
History:
A franchisee, an affiliate, or the firm itself runs a McDonald's restaurant. The company's
income is derived from sales in its own restaurants as well as rent, royalties, and other fees
paid by franchisees. Throughout the three years ending in 2007, McDonald's revenues
increased by 27% to $22.8 billion, and operating income increased by 9% to $3.9 billion.
Burgers, cheeseburgers, chicken goods, fries, breakfast dishes, soft drinks, shakes, and
desserts are McDonald's main product offerings. The company has adjusted its menu to
include items that are viewed as healthier, such as salads, wraps, and fruit, in reaction to the
Western world's rising rates of obesity and in response to customer complaints about the
nutritional value of its goods.
On May 4, 1961, McDonald's originally submitted a U.S. trademark application for the
name McDonald's under the heading "Drive-In Restaurant Services," which has since
been renewed through the end of December 2009. On September 13 of the same year,
1961, the business submitted a trademark application for a double-arched, overlapping
"M" logo. When a trademark application for a single arch, which was shaped above many
of the early McDonald's restaurants in the early years, was filed on September 6, 1962,
the overlapping double arched "M" symbol emblem was temporarily outlawed. The
corporation didn't start using the well-known double-arched "M" emblem until it
registered a trademark in the United States on November 18, 1968.
2
In order of debut, the first McDonald's restaurants were established in the following countries:
the United States, Canada, Costa Rica, Panama, Japan, the Netherlands, Germany, Australia,
France, El Salvador, and Sweden.
The ninth McDonald's restaurant overall and the franchised restaurant opened by Ray Kroc in
Des Plaines, Illinois, on April 15, 1955, is when the current corporation was established. Later,
Kroc bought out the McDonald brothers' share in the business and oversaw its global expansion.
In 1965, the business was placed on stock exchanges for the general public.
Moreover, Kroc was known for his harsh business methods, which forced the McDonald brothers
to abandon the fast food business. Both Kroc's autobiography and the autobiographies of the
McDonald brothers detail the conflict between the brothers and Kroc for ownership of the
company. The original McDonald Brothers restaurant location is currently the site of a
monument.
McDonald's has entered numerous foreign markets, and as a result, the corporation has come to
represent globalisation and the spread of the American way of life. Due to its popularity, it is also
frequently brought up in discussions in the media regarding issues such as corporate ethics,
consumer responsibility, and obesity.
3
Corporate Overview:
There are 119 countries and territories where McDonald's restaurants may be found, and they
serve 58 million people daily. More than 1.5 million people are employed by McDonald's,
which runs more than 31,000 outlets globally. The business also runs different restaurant
brands, like Piles Café.
In order to concentrate on its core brand, McDonald's started selling off the additional chains
it had purchased in the 1990s. Up until October 2006, when McDonald's entirely divested
from Chipotle through a stock exchange, the firm held a majority ownership in the
restaurant. Furthermore, it owned Donatos Pizza up to December 2003. Sun Capital Partners
purchased Boston Market from McDonald's on August 27, 2007.
Types of restaurants:
In certain nations, "McDrive" establishments close to highways don't have a counter or any
seating. Locations in densely populated urban areas, however, frequently do not offer drive-
through service. A small number of establishments, mostly in downtown areas, also provide
walk-through service in place of drive-through service.
4
There are other restaurants with unique themes, such as the "Solid Gold McDonald's,"
which is decorated in the style of 1950s rock and roll. Another McDonald's with
comparable lighting fixtures and a 24-carat (100%) gold chandelier may be found in
Victoria, British Columbia.
In order to meet the demand for premium coffee and the growing popularity of coffee shops
in general, McDonald's created McCafé, a Starbucks-inspired café that complements
McDonald's restaurants. McDonald's Australia developed the McCafé concept, launching it
in Melbourne in 1993. The majority of McDonald's in Australia now offer McCafés within
the actual McDonald's restaurant. Every store in Tasmania has a McCafé, and the other states
are fast following suit. Some Australian outlets have seen up to a 60% rise in sales after
switching to the new McCafé appearance and feel. Worldwide, there were more than 600
McCafés as of the year 2003.
Some McExpress restaurants offer limited seating and/or menu options and are attached to
gas stations or convenience stores, while other McExpress outlets may be found in malls.
There are McDonald's restaurants in Wal-Mart locations. McStop is a destination geared
towards passengers and truckers that offers services typically seen in truck stops.
Playgrounds:
Some McDonald's in cities and suburbs include sizable indoor or outdoor playgrounds. In the
USA, the first PlayPlace with the well-known crawl-tube design, ball pits, and slides debuted
in 1987. Thereafter, numerous additional Play Places were built.
Redesign:
McDonald's undertook its first significant restaurant remodel since the 1970s in 2006 to
launch its "Forever Young" brand. Traditional McDonald's yellow and red are used in the
design, but the red has been subdued to terra cotta, the yellow has been made golden for a
more "sunny" appearance, and olive and sage green have also been introduced. Less plastic
5
and more brick and wood are used in the restaurants to warm up their appearance, while new
hanging lights are used to provide a softer glow. The walls are covered with framed pictures
or contemporary art.
Business Model:
The Corporation may own or lease the properties on which McDonald's franchises are
located as a requirement of various franchise agreements, which vary by contract, age,
nation, and location. Most of the time, if not always, the franchisee does not own the
property where its restaurants are located.
Less than 30% of restaurants in the UK are franchised, making that country's business
model unique. The bulk of restaurants there are owned by the corporation. At Hamburger
University in Oak Brook, Illinois, McDonald's trains its franchisees as well as others.
McDonald's restaurants are run by joint ventures between the McDonald's Company and
other local businesses or governments in various countries. McDonald's has a policy of not
selling food or supplies directly to franchisees and instead arranges for the supply of food
and supplies to restaurants through authorised third-party logistics providers.
Fast Food Nation by Eric Schlosser (2001) claims that one in eight Americans have worked
for McDonald's at some point. (One in ten, according to a news report on Fox News.)
According to the book, McDonald's is also the biggest private operator of playgrounds in the
6
United States and the company's exclusive supplier of beef, pork, potatoes, and apples.
Depending on the customs of the host nation, McDonald's utilises a different range of meats.
STRENGHT
1. Highest-Value Brands
The ninth most valuable brand in the world is McDonald's. Despite the tough
competition, the company dominates the restaurant sector thanks to its exceptional brand
value.
2. Delish Food
Fries from McDonald's are regarded as having the best flavour in the fast food sector.
According to a consumer study, McDonald's fries had the best flavour.
Few people are aware that McDonald's has a multi-billion-dollar real estate empire in
addition to selling hamburgers and fries. Consider having thousands of exclusive venues all
around the world.
7
Franchises for McDonald's operate slightly differently. In addition to giving franchisees
access to their name, recipes, ingredients, and processes, McDonald's also owns the land
and functions as a landlord, earning money from rent payments.
4. Technological Projects
5. Technology Purchases
Dynamic Yield, the company's most recent acquisition, is another step in the direction of
better tailored marketing and customisation. Israeli firm Dynamic Yield helps companies
like McDonald's improve their customer experiences by offering more individualised
products.
The honour of being the most valuable fast food brand in the world belongs to McDonald's.
McDonald's brand value rose to $48.6 billion in 2022, according to Interbrand (an increase
of around 6% from 2021). In terms of brand value, no other fast-food company came close
to matching McDonald's. Starbucks is the following close rival, with a $14 billion brand
value.
8
With $23.18 billion in sales, McDonald's was the largest chain of quick-service restaurants
(QSRs) in 2022.
WEAKNESSES
The best illustration of a global franchising model is McDonald's. Yet, the brand runs some
risks because of the intricate network of franchised and company-operated locations.
The dangers of declining finances, poor management, unsatisfied clients, and low income
growth. The company relies largely on franchisees, each of which operates autonomously.
As a result, they have little influence over their daily performance, which immediately
impacts the brand.
9
Due to the increased operational costs brought on by such interruptions, a franchise's
revenue and profitability are subsequently reduced.
Employee unhappiness has reached critical levels in many firms as a result of recent
employee rights revolutions around the world and higher compensation ceilings.
The staff at McDonald's has recently been quite critical of the company. The workers
damaged the reputation of the business by participating in many rallies and strikes to seek
an increase in the minimum wage to $15 per hour.
McDonald's breakfast sales remained unrivalled for almost ten years, particularly in the US.
However in May 2018, the company's CFO acknowledged that they had seen a decline in
the use of the McDonald's breakfast menu and that they needed to take action to reverse it.
Yet it won't likely be simple to restore the appeal of breakfast foods given the intense
rivalry in the area.
Steve Easterbrook, the CEO of McDonald's, was let go in November 2019 for engaging in a
consensual relationship with a worker. It went against business policy. Also, the board of
the business claimed that Steve had "exhibited bad judgement."
10
Five employees filed a lawsuit against McDonald's in May 2020 for disobeying government
safety recommendations. The claim in the case is that by failing to offer hand sanitizer,
gloves, and masks during the recent health crisis, McDonald put the lives of its employees
and their families in danger.
7. Sexual exploitation
Regardless of gender, businesses must foster a secure workplace for all employees. In a
lawsuit brought by more than 100 female employees in April 2020, McDonald's is charged
with fostering a hostile workplace and sexually harassing them. The action further damages
its reputation and erodes confidence.
8. Harmful publicity
In June 2020, McDonald's was accused of firing a worker who had filed a lawsuit against
the business for failing to adequately safeguard its workers amid the most current health
issue. Because it aims to deter other workers from using their legal recourse against their
company, the termination is unethical.
OPPORTUNITIES
1. Value Meals
In an effort to appeal to customers who are value-conscious, McDonald's introduced its "$1, $2, $3"
menu and "2 for $5 Mix and match deal" in 2018. Sales rose as a result of the menu expansion, which
was successful.
2. Original Goods
11
To compete with the new fast food restaurants, McDonald's must make an effort to add fresh, creative
items to their menu.
In its New York locations, the company began serving an exclusive beverage in 2018 called MIX by
Sprite Tropic Berry. It was an immediate success and will probably be offered across the Nation.
More products like these, tailored to local customs and situations, could aid McDonald's in
preserving their allure for a longer time.
3. Worldwide Expansion
McDonald's dominates the US market, although it frequently faces challenges elsewhere. But, by
concentrating more on worldwide markets than on various US states, the company has a strong
chance of continuing its global success.
McDonald's may play it smart by maintaining its strong initiatives towards, nutritious and
personalised options, while fast-food outlets struggle to combat the reputation of "junk generating
hubs."
With positive comparative sales resulting in an increase in profitability, these improvements have
started to demonstrate success. Sales have undoubtedly been affected by the re-franchising mission,
but in the long run, McDonald's positive reputation may continue to have a greater impact.
For US food delivery, McDonald's has started a relationship with DoorDash and UberEats.
McDonald's is able to reach and meet the constantly changing needs of its customers thanks to these
mobile order and delivery initiatives.
12
Increasingly customers are looking for healthier alternatives. 1% Low Fat Milk Jugs and salads are
only a couple of the many healthful options McDonald's offers. The business can expand by offering
more nutritious products in order to draw in more health-conscious customers.
McDonald's emphasis on providing the best on-site dining experience turned out to be a serious flaw
during the current health crisis. As more customers chose pick-ups and deliveries to be consumed at
home, this strategy resulted in a 17% reduction in earnings. In order to draw in more customers
during this difficult period, McDonald's can enhance deliveries, curbside pickups, self-order kiosks,
and drive-thru choices.
During the present health issue, McDonald's concentration on offering the greatest on-site dining
experience proved to be a severe weakness. This tactic caused a 17% decrease in revenue as more
consumers opted for pick-ups and deliveries that they could consume at home. McDonald's can
improve delivery options, curbside pickup options, self-order kiosk options, and drive-thru options in
order to attract more consumers during this challenging time.
13
THREATS
The public's rapid adoption of new technology could reduce the ROI and prevent the benefits
of improving customer experience from yielding the anticipated returns.
Thought to be McDonald's only rivals are behemoth burger chains like "Burger King," the
situation is starting to change.
In the very competitive Quick Service Restaurant (QSR) market, Chick-fil-A is currently
McDonald's largest rival, according to Restaurant Business.
Also, it can be difficult to adjust and run the franchise differently depending on where it is
located. For instance, a few years ago, McDonald's was embroiled in a significant scandal
over the use of products that were not considered "halaal" in Muslim nations.
With inherited risks in the global operating environment brought on by such issues,
McDonald's finds it challenging to match customer expectations, which hurts the brand's
reputation.
14
4. Modern Developments in Fast Food
McDonald's is frequently viewed as being "old school" among millennials due to its
traditional menu and taste. With their frequently altered menus and recipes to add diversity,
fast food businesses like Shake Shack and Wendy's take full advantage of the scenario.
For instance, in order to save face, McDonald's had to continue with their traditional Quarter
Pounders after failing to compete with Wendy's "Signature-Crafted Burgers."
A recent study found that well-known fast food companies like McDonald's target their
social media advertising strategies at underserved or low-income populations all across the
world.
With the use of well-known, mainstream social media platforms like Instagram, Snapchat,
Twitter, and Facebook, McDonald's is able to reach millions of young people worldwide.
But, the survey also noted that its marketing is starting to have a negative impact on
consumer health, which could have dangerous consequences in the future.
Due to the shaky economy in 2022, McDonald's missed profits for the entire year. Due to
this, its net income fell by 18% and could fall even worse if economic uncertainty lasts
longer.
15
7. The Increase in Health Awareness
Increasingly people are migrating to healthier options like vegetables and organic smoothies
and embracing healthy habits. Sadly, the majority of McDonald's menu items are unhealthy,
and it risks losing health-conscious customers to rival restaurants that provide better options.
For many nations, the rise in lifestyle diseases is a burden. Some nations have passed
legislation that restricts the use of particular dangerous substances or outlaws the operation
of fast-food restaurants. McDonald's has been outlawed in nine nations, including Bolivia,
Bermuda, Bermuda, Iceland, Macedonia, and Montenegro.
Like all other food conglomerates, McDonald's is under intense pressure to enhance its
procedures in order to reduce waste, which contributes to environmental degradation.
It is necessary for McDonald's to take action in this area and serve as a role model for other
restaurants, but it is not as easy as that.
Due to a rise in plastic waste, environmental groups asked McDonald's' board of directors in
March 2018 to stop using plastic straws in its more than 40,000 locations globally.
16
Almost 11 million people frequent BURGER KING restaurants worldwide every day. They do this as
our restaurants are renowned for offering high-quality, delicious, and reasonably priced meals.
Burger King (BK) is a popular American eating establishment company that serves hamburgers. The
company, formerly known as Insta-Burger King, was established in 1953 and has its headquarters
in an unincorporated area of Miami-Dade County, Florida. In 1958, Miami-based franchisees David
Edgerton and James McLamore bought the business and changed its name to "Burger King." In a
deal worth US$3.26 billion, Brazilian corporation 3G Capital acquired the bulk of the company's
shares in late 2010. As soon as they took over, the new owners started reorganising the
business to turn around its fortunes. Burger King's menu has grown from a simple offering
of hamburgers, French fries, sodas, and milkshakes to a wider and more diverse variety of
products thanks to the merger of 3G and partner Berkshire Hathaway with the Canadian
doughnut brand. The "Whopper" was the first significant addition to the menu in 1957 and
has subsequently evolved into Burger King's flagship item. With roughly 13,000 outlets
open in 100 countries, Burger King is the second-largest fast food hamburger business in
the world. The hallmark of our brand for more than 50 prosperous years as the original
HOME OF THE WHOPPER has been our dedication to superior ingredients, unique dishes,
and family-friendly dining experiences. It may be hard to imagine, but Burger King began
before McDonalds Corporation, the second-largest fast food restaurant chain in the US. You
can also find children's play areas or playgrounds in some Burger King locations. Delivery
is available at several Burger King locations. When it comes to burger size, Burger King
comes out on top because its burger is nearly 20% larger.
17
SWOT ANALYSIS
STRENTHS
There are 18,838 Burger King locations globally, scattered over nearly 100 nations. With
more than 10 million customers served each day, it is the sixth-largest fast-food business in
the world. Unquestionably, the chain's extensive global reach is a key advantage.
2. Effective Strategies:
Businesses that use effective management strategies constantly look for ways to reenergize
and keep current with market trends. Burger King hired 32-year-old Daniel Schwartz as CEO
to revitalise the brand after it had been dormant for years. Within a few years, the CEO, a
dynamic young man, revitalised and turned the company around.
Presently, franchisees own over 15,000 Burger King locations, making almost 90% of the
company. Only a $45,000 franchise fee and a $317,100 minimum initial investment are
required to purchase its franchise. It is the franchise with the lowest cost.
4. Broad Range:
Burger King has a selection of regional and international menu choices to satisfy any out-of-
town visitor. It is favoured for its extensive menu, which includes bacon-studded buns, plant-
18
based Whoppers, grilled burgers, taro-filled pies, poutine-covered fries, beverages, desserts,
chicken items, and much more.
5. Innovative Products:
Burger King constantly reinvents and reenergizes itself with cutting-edge offerings.
Impossible Whopper plant-based sandwiches were introduced, which drew new clients and
allowed the business to surpass second-quarter earnings projections in 2019.
INDEX
6. Imaginative Marketing:
Burger King provides healthier selections than rivals, yet it isn't yet the healthiest food
source on the market.
WEAKNESSES
1. Overdependence on US Market:
The US accounts for $9.2 billion of Burger King's revenue and is home to about 44.0% of
the company's stores. As a result, the company's revenue stream is almost entirely vulnerable
to any difficulties in the US market.
19
2. False Advertising:
3. Over-Franchising:
Although Burger King's franchisees have been successfully run up until this point, rapid
franchising compromises the model's long-term viability. For instance, what will happen to
Burger King is highlighted by the battle between Subway and its franchise owners.
4. Lack of Stability:
From serving horsemeat to its patrons to serving vegans non-vegan Whoppers, and many
more, each scandal and bad publicity erodes patron faith even further.
6. Poor Value:
20
Many shoppers want to get the most for their money. Regrettably, Burger King provides
poor value for money on all of its burgers, regardless of price. Because of this, it does not
have a devoted clientele; instead, if it is more convenient, clients can eat at rival restaurants.
OPPORTUNITIES
A high market presence guarantees that every customer may access an outlet rather than
turning to a rival. Burger King intends to grow from 26,000 to 40,000 stores because it
recognises the opportunities that more locations may provide.
After introducing the healthier Impossible Whopper sandwich, Burger King saw an almost
30% increase in sales. By adding more plant-based alternatives to its menu, the business can
take advantage of the rising demand for healthy foods.
3. Diversification:
Burger King can broaden its holdings in order to lessen its reliance on the restaurant
industry. It might start a grocery shop instead of relying on other retailers to sell its plant-
based Whoppers, for example.
21
Emerging economies provide untapped markets and significant development potential,
ranging from Asia to Africa, the Middle East, and Latin America.
Burger King has tweeted urging consumers to order from McDonald's in an effort to
revitalise the restaurant business during the pandemic
22
CHAPTER 2
RESEARCH METHODOLOGY
This chapter focuses on the research methodology employed in the study. It describes in
detail the research methodology used in this study. The following sections discussed the
research design, target population, research instruments, data collection, and analysis
methods used.
Objectives
To measure the opportunities and challenges for fast food businesses in India Scope
This study examines the current trends in the Indian fast food market. In this study, a
comparison of McDonald's and Burger King is made. This study examines customers'
attitudes towards McDonald's and Burger King. This study assesses the opportunities and
challenges for Indian fast food businesses.
23
RESEARCH METHODOLOGY
Research Design
This study is descriptive in nature because it included survey questions, which are
characteristics of descriptive research.
Data Collection
Depending on the research need and the depth of information and coverage required, a
research can use either secondary or primary research methods, or both. To gather
information for this study, the researcher used both primary and secondary research methods.
Primary data
Sample Size: 30
Secondary data
Website
Newspaper
24
Magazines
Project Material
Books
Research Instrument
In this study, we used questionnaires in addition to other data collection methods such as
interviews and observations.
Questionnaires appear to be a logical and simple way of gathering information from people.
They are actually quite difficult to design, and due to the frequency with which they are used
in all contexts in the modern world, the response rate is almost always going to be a problem
(low) unless you have ways of forcing people to complete and submit them on the spot (and
this of course limits your sample, how long the questionnaire can be and the kinds of
questions asked).
25
from Likert's distinction between the underlying phenomenon under investigation and the
means of capturing variation that points to the underlying phenomenon. Respondents
specify their level of agreement or disagreement on a symmetric agree-disagree scale for a
series of statements when responding to a Likert questionnaire item. Thus, the range
captures the intensity of their feelings for a given item, whereas the results of analysing
multiple items (if the items are appropriately developed) reveal a pattern with scaled
properties of the type Likert identified.
1. Strongly agree
2. Agree
4. Disagree
5. Strongly disagree
Likert scaling is a bipolar scaling method that measures a statement's positive or negative
response. A four-point scale is occasionally used; this is a "forced choice" method because
the middle option of "neither agree nor disagree" is not available.
Analysis:
Analysis is classifying and rearranging the raw data to arrive at meaningful interpretation.
26
Interpretation:
Interpretation is important because it brings the results of the analysis to the forefront.
The researcher can understand the abstract principles at work beneath his findings only
through interpretation. This allows him to connect the same abstract to those of other
studies that share the same abstract principle.
The establishment of explanatory concepts that can serve as a guide or tutor for research
studies is led by interpretation.
Only through interpretation can research be appreciated, allowing others to understand the
researcher's findings in a specific project study. The collected data is analysed using a
simple percentage tool in comparison to the total number of respondents. The content
analysis presented in the form of pie charts.
27
CHAPTER 3
LITERATURE REVIEW
McDonald's vs. Burger King: A Competitive Study, Richel Marell, 2014 There are
thousands of businesses vying for market share with McDonald's. McDonald's is aware that
it competes with other significant burger and chicken chains as well as independently
owned fish and chip businesses and other eat-in or take-away restaurants. A corporation like
McDonald's must therefore create competitive tactics to set itself apart from its competitors.
Any organisation, in fact, must be aware of its business environment in order to ensure that
what it does meets the needs of its clients. Particularly, that standards vary throughout
cultures and time. Indeed, in order to stay at the top of their game, even large corporations
like them must keep a close eye on their backs. Furthermore, the market niche in which
McDonald's competes is getting more and more cutthroat. But how does this company
maintain its dominant position in the world market? In order to achieve this goal, let's
examine together how and why the American multinational continues to dominate in three
key global locations.
First off, the reason why McDonald's feeds almost 68 million people per day in 119
countries makes it the largest network of fast food restaurants in the world. But the key to
this achievement is a solid strategic competitive advantage that the business is still
developing today. The company's strong supply chain is well known, in fact. And that's
important because it enables them to provide the cheapest meal. Also, McDonald enters new
markets without hesitation and has an exceedingly ingenious distribution system.
The majority of Burger King's fast-food outlets are privately owned franchises that are
located abroad. While the bulk of such franchisees are tiny businesses, a few have
developed into substantial independent organisations. Burger King reported having 12,667
locations worldwide as of the conclusion of its fiscal quarter in September 2014, with 66%
of those locations being in the United States and 95% of them being privately owned and
run. More than 37,000 employees work at corporate facilities, which daily serve 11.4
million clients.
28
To reflect a more contemporary approach to food services, Burger King is also remodelling
its locations, altering its packaging, sanitising its cooking method, and changing uniforms.
Finlay, these elements will make the customer experience more appealing. Yet, the absence
of the high-end chicken wraps, salads, and coffee drinks that have emerged as the "must-
haves" at a fast food establishment in 2014 makes Burger King appear somewhat outdated
and "out of touch." The struggle to remain relevant has undoubtedly suffered from not
having those things. Burger King's main concern should be how to deliver the value
proposition more effectively. How can we emphasise Burger King's advantages to clients
seeking fast food more effectively? In actuality, there must be something Burger King
specifically promised to its customers that McDonald's and Wendy's are not doing. If it
were made available on the market, that would offer a competitive edge. Burger King will
be truly distinctive in this way.
McDonald's offers more price reductions than Burger King. They have incredibly affordable
food prices. The "Value Mc Savers" and the "Mc Value Meal" are available. McDonald has
the most affordable fast food options. Nevertheless, McDonald's only provided this service
for a limited time, raising the issue of availability. McDonald's has 185 locations across the
country, according to distribution. Due to a trend of all Malaysians who prefer to shop in
malls, they are constructed or made available in retail spaces like shopping malls. Although
Burger King has more restaurants there, they also open in certain rural places.
29
goods. This might satiate the appetite of customers like working executives who are on the
go and drivers.
McDonalds sponsors events primarily to support their social responsibility. Typically, they
plan fundraisers for the Ronald McDonald Charity House. Burger King, on the other hand, is
more concerned with strengthening their position in the market than with charitable causes.
Lately, "they organise campaign, named "Good things come together with burger king," aims
to set burger king apart from its competitors and emphasises the presence and importance of
the fast food chain in regular Malaysian life. In Malaysia, McDonald's sends fliers to homes
and affixes coupons to newspapers as part of its marketing strategy. Coupons are also
provided by Burger King. Nevertheless, unlike McDonald's, Burger King coupons must be
obtained from the store.
Moreover, McDonald's uses billboards to promote its goods. They post their most recent ads
for "McDonald's Mc Value Meals" around thoroughfares that do get attention.
Burger King does not use this technique for advertising to advance their brand.
McDonald's offers more price reductions than Burger King. The "Value Mc Savers" and the
"Mc Value Meal" are available. McDonald gives the best price for fast food, compared to
Burger King.
Consequently, we can draw the conclusion that McDonald's invests a lot in marketing,
particularly their advertising, to establish their place in the market. This fits well with the
global advertising strategy of McDonald's to keep customers.
30
According to the literature analysis, five factors—service quality, food quality, price,
location, and environment—have an impact on restaurant patrons' decisions. Consequences
of the literature review included hypothetical connections between factors impacting
consumer behaviour, relationship quality, and loyalty. According to data study, the
following five factors affect loyalty building, with impact intervene by relationship quality.
By encouraging loyalty and boosting their degree of trust, these also capitalise on client
satisfaction. Also, compared to other criteria, the influence of service quality is larger and
has a direct or indirect impact on trust levels. Suggestions for managers are discussed. In the
US, there is fierce competition in the fast food industry, and this is only likely to get worse
over time.
Dr. Essam Ibrahim, Indian Fast Food Industry Analysis, 2012, This report analyses the
international marketing landscape of the global fast food sector and rates McDonald's, a
significant player, on its foreign marketing endeavours. McDonald's was selected as the
market leader based on the industry analysis, and their market entry strategies were
investigated. To determine the success elements, their global marketing mix was assessed,
with an emphasis on global branding, global distribution, global communications, and
uniformity vs. adaptability of the service offering. Although an external analysis looked at
potential and challenges to McDonald's as the market leader, an inside analysis assessed the
company's strengths and flaws. Lastly, recommendations for short- and long-term strategic
and tactical changes were provided in order to strengthen McDonald's position as a global
leader in the fast-food sector. Based on the analysis of their existing strategy and operations,
these suggestions are both practical and solidly substantiated. The fast food sector was
noted as a low-cost, high-turnover sector with fierce competition. McDonald's was chosen
as a key participant for an evaluation of their worldwide marketing activities after a
thorough examination of the market revealed it to be the market leader. Following the
identification of both internal and external elements, backed suggestions were developed to
strengthen McDonald's competitive position in the global market.
The Business Strategy of McDonald's, Jing Han, 2013, As one of the most prosperous
fast food chains in the world, McDonald's has successfully implemented numerous business
31
strategies over the course of its history. In this essay, I'll talk about some important business
tactics that are related to the internal structure of the organisation and the external
environment. The structure of this essay is as follows: I shall provide a brief overview of
McDonald's achievements in the first section. I will examine specific methods employed by
McDonald's in the second section and how these strategies are appropriate for their business
structure. The reason McDonald's chose these tactics in response to the shifting external
environment will then be examined. I'll wrap up by summarising the methods McDonald's
employed to meet their strategic objectives. In conclusion, there is a good chance that the
company will lose market share if it ignores new competitors, evolving customer interests,
social trends, or innovative technologies. More than 50% of the rise in new restaurants
opened during the nearly five years that McDonald's placed emphasis on creating new
locations. The sale of the food only increased by 2%, which is regrettable. Consequently, in
2003, McDonald's made the decision to shift its emphasis to growing sales at existing
restaurants and cutting capital spending, which enables a sizable sum of money to be
returned to shareholders. The goal for McDonald's should strive to draw in more new
consumers, entice current customers to visit more frequently, foster brand loyalty, and
eventually provide sustained profitable growth for the business.
The amount of power given to local management and the impact of the innovation process
are positively correlated. The amount of control that franchisees and managers in company-
owned outlets have in these areas varies depending on the organisational structure, with
32
franchisees having the most authority in medium-sized innovations and managers in
company-owned outlets having the most power in minor innovations. Although the
communication was seen as effective and enjoyable generally, there are still plenty of
opportunities for improvement. The authors think that by establishing more horizontal
communication within local management, the overall internal communication will benefit.
This would especially help the franchise system, where improved local cooperation and
communication would result in more effective communication across the board.
Mounia Belkoura, Market Analysis of McDonalds, Burger King, 2014, In this study,
Burger King and McDonald's, two publicly traded companies, are the subjects of a business
examination. They are both competitors in the fast food market. One of the major food
service industries in the world is the fast food industry. To draw customers from all around
the world, this industry concentrates on a reduced price strategy. Because of this, the S&P
Industry Study on the Restaurant Industry predicts that "Our estimate is that restaurants will
be mainly unable or reluctant to raise prices substantially, if at all, for fear of losing
consumers to the competition.". Contrarily, the fast food sector is receiving harsh criticism
from numerous health organisations, and many people believe that fast food is to blame for
the current epidemic of obesity and diabetes among teenagers and adults. The San Francisco
Board of Supervisors has "approved a restriction on restaurant gift-giving unless the
aforementioned meals fulfil particular healthy nutritional guidelines for calories, sodium,
and fat." The fast food business was advised by the authority to balance the nutritional
requirements for children.
Despite the economic downturn, the fast food industry is still profitable because "during a
recession, an increase in unemployment generally leads to a decrease in consumption
levels." Consumers are more likely to spend money on fast food restaurants when personal
consumption expenditure is high.
As a result, in order to mitigate the effects of these criticisms, fastest food restaurants have
begun to offer healthier options such as yoghurt, salads, and fruits. Even though people
have realised the importance of health, the fast food industry continues to generate
significant profits in the US market. Currently, the fast food industry is attempting to sell
healthier food in order to improve the corporation's image and provide more options to the
33
public. McDonald's and Burger King are not only competing against each other, but they
must also contend with other types of restaurants. For example, most dine-in restaurants,
such as TGI Friday's and Chilies, offered low-cost menus last year, reducing the appeal of
McDonald's and Burger King's food to customers. When the economy is bad, there is a lot
of competition in the fast food industry because people spend less money on food and often
choose the cheapest option with the best value. The Economist reports that "fast food was
once thought to be recession-proof." When consumers' budgets are tight, the logic goes,
cheap meals like Big Macs and Whoppers become even more appealing. Furthermore, it is
more difficult to expand the fast food industry in European countries. Fast food is
associated with American culture and tradition throughout the world. As far as we know,
most Europeans prefer their traditional cuisine and are hesitant to try American fast food.
For example, most Europeans would rather shop locally than eat at McDonald's. They are
always critical of McDonalds' monopolistic behaviour and the unfair labour contracts
provided to employees. Furthermore, some Europeans simply value the time spent cooking
and eating, and they do not prefer eating a 5-minute wrap-up meal with an excessive
amount of calories in fast food restaurants.
34
CHAPTER-4
Dear Sir/Madam,
DISCLAIMER: All of the questions in this questionnaire are for academic purposes only
and will not be used against you in any way. The information shared will be kept private.
INSTRUCTIONS:
2 Your feedback is highly valuable. Hence, kindly be honest about your views. Name-
Age – Gender –
35
1. On a scale of 1-3 , How will you rate the following:
Sales
Mcdonalds
KFC
BURGER KING
36
2. Do you think ambience of the food joints influences your choice for a particular food
joint?
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
strongly agree, 27% of customers agree, 17% of customers neither agree nor disagree,
37
3. Does McDonald’s have better ambience in terms of cleanliness and crowd as compared
to Burger King
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
strongly agree, 23% of customers agree, 27% of customers neither agree nor disagree, 10%
38
4. Customer service of McDonalds’ is more prompt than Burger King
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
strongly agree, 23% of customers agree, 10% of customers neither agree nor disagree, 17%
39
5. The food products provided by Burger King are more reasonably priced than that of
McDonald’s
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
strongly agree, 27% of customers agree, 33% of customers neither agree nor disagree, 10%
40
6. Burger King provides frequent discounts relative to McDonalds’
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
customers it states that 17% of customers strongly agree, 20% of customers agree, 25% of
the customers neither agree nor disagree,30% of customers disagree and 8% strongly
disagree.
41
7. McDonalds’ food is quite oily, compared to Burger Kind Food
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
42
8. When it is about fresh chicken, I prefer Mc Donald’s as the chicken tastes not only fresh but juicy
and yummy?
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
agree, 23% of customers agree, 14% of customers neither agree nor disagree, 23% of customers
43
9. Home Delivery Services of McDonalds’ are better than of Burger King.
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
13% of customers agree, 10% of customers neither agree nor disagree, 10% of customers disagree, and
44
10. As far as the size of the burger is concerned, the Burger King wins with the size of its burger being
almost 20% bigger than that of McDonalds.?
Sales
Strongly Agree
Agree
Neither Agree Nor Disagree
Disagree
Strongly Disagree
states that 44% of customers strongly agree,25% of customers agree,19% of the customers neither
45
CHAPTER 5
SUGGESTION, CONCLUSION & REFERENCES
SUGGESTION
There is a lot of competition in the fast food industry in India, and it is only getting worse. So we're
looking at the competitive situations with McDonald's by comparing one of the biggest names in the
fast food industry, Burger King. These businesses want to know where the fast food seekers are and
how to find them. As a result, McDonald's offers their customers high-quality, fresh fast food. There are
many things to learn about the competition within a given market because it serves as a barometer of
how difficult or easy it is to work within that market. Unrelenting competition will undoubtedly affect
marketing working outflow; as a result, it is useful to know what type of struggle will occur to face
within that market. It is critical to understand the market in which the company operates, as well as the
potential for entering the market and potential customers. Furthermore, it is prudent to consider the
macro environmental factors influencing the market.
Customer service is a collaboration to meet the needs and desires of their customers. A businessman
can offer promotions and price cuts to attract as many new customers as possible, but if the
businessman wants his customers to return, the business will not be profitable for long. Superior
customer service is primarily intended to entice customers to return and to make business owners
happy. It is a sign of positive feedback to business from others who may be trying a businessman's
product or service. Building customer loyalty will be easier if the business owner has loyal
employees. Tradespeople are critical for manufacturers to protect those workforces who interact
with customers. The current trend is to route customer service and technical hold-up calls to the next
available person.
McDonald's sales have increased by more than $6.42 billion per year, and the company has received
numerous awards and honours over the last 42 years. McDonald's has over 36,899 locations
worldwide, and its rapid expansion has attracted many investors. As a part of this international
market where these large corporations compete, McDonald's is taking a challenge to face the market
by giving their customers a beneficial advantage and increasing profitability and sales.
McDonald's can compete in the fast food market with burger chains and other big names in the
international market. McDonald's changes by creating a more casual and appealing menu and adding
some new menu items based on customer preferences.
46
In the preceding discussion, we came to the conclusion that by employing various marketing
strategies in the McDonald's chain, we can establish customer loyalty to our customers. The purpose
of this research is to express the market status of McDonald's in comparison to Burger King. This
study also explains how you should act in order to keep your customers and turn them into long-
term customers.
According to the evaluation, the most important goal of the McDonald's chain is to be ranked as the
number one restaurant in terms of consumers and also in each market segment in which McDonald's
operates.
In addition to this, McDonald’s does not purposely select the new countries to enter. It is also found
from the evaluation of the secondary data that the product policy so undertaken is global in nature
by using the such techniques that can assist in branding and also to establish the name worldwide.
According to the marketing theory, McDonalds also applied the services marketing concepts in the
form of different elements of promotion mix with a specific reason to supplement the level of brand
awareness as well as awareness about product offerings so concern.
The overall objective of the organization is to enhance brand awareness among customers and also
to establish its name in the market it serves so that the total sales can be raised significantly.
It also adopted the advertisement plan which is distinctive so that it can easily avail the benefits from
the market so concerned and thus creating opportunities to expand its business. The promotion
techniques to be adopted should carry a differentiated and a unique message.
Thus it is recommended for the McDonalds that it should concentrate on its message which is to be
carried with regard to its taste, food, affordability and quality to be delivered to the customers.
It should also focus on the target groups such as family, teenagers and students as these target groups
spend lot of time on social networking sites or other sites. So McDonald’s can add banners on such
networking sites which are regularly visited by the target groups so concerned.
The publications such as newspapers can also be used for this purpose. It should also concentrate on
the differentiated ideas and also the potentialities so that more of the benefits can be achiev
47
LIMITATIONS
The main three limitations of this research are time, finance and access. The research is time crucial
due to the deadline placed on the submission of the final research findings. Therefore, starting from
sampling till data collection everything needs to be done as quickly as possible thus leaves
researcher with limited amount of time.
Access to Companies data may be an issue because the researcher will not be able to reach customers
due to limited time.
48
CONCLUSION
One of today's major issues is unbalanced growth in customer loyalty programmes. This paper
exemplifies the environment and the approaches loyalty managers can take to meet this difficult
challenge. This can only be accomplished by creating a business plan and optimising business process
design to compute those strategies that are maintained by highly technological individuals. For business
processes that are fully covered by business strategies, overall coverage at each level is required.
Technology meets all of the needs of business processes while also meeting all of the technological
requirements.
The fast-food industry has been identified as a low-cost, high-turnover industry with fierce competition.
Following a thorough industry analysis, McDonald's was identified as the market leader and chosen as a
key player to evaluate their international marketing activities. Following the identification of internal
and external factors, supported recommendations were developed to improve McDonald's competitive
position in the international market.
In 2014, burger fast food from the two major chains McDonald's and Burger King remained very
popular. Traditional sausage fast food, such as hot dogs and grilled sausages, which were previously
sold primarily by a large number of independent grill bars, as well as at various fixed and mobile street
stalls, also disappeared. Traditional sausage fast food sales have been declining in these traditional
outlets for several years, but they have been increasing in convenience stores
49
REFERENCES
BOOKS
• Kubendran, V. and Vanniarajan, T., 2005, Comparative analysis of rural and urban consumers on
milk consumption. Ind. J. Mktg, 35 (12) : 27-30.
• Kumar, K., Ambarish, Jordan, B.B. and Barker Tansu, A., 1987, Made in India, what it means to
Indian consumers ? Ind. J. Mktg, 17 (9) : 26-34.
• Ragavan, R., 1994, A study on the consumer response towards franchise vegetable outlets – A case
of just picked. M.Sc. (Agri.) Thesis, Tamil Nadu Agric. Univ., Coimbatore.
• Ramasamy, K., Kalaivanan, G. and Sukumar, S., 2005, Consumer behaviour towards instant food
products. Ind. J. Mktg., 24 (2-3) : 55-59.
INTERNET
• www.burgerkingindia.in
• www.mcdonaldsindia.com
• www.investopedia.com
NEWSPAPERS
50
ANNEXURE
Dear Sir/Madam,
DISCLAIMER: All the questions asked in this questionnaire are solely for academic purposes and
won’t be used against you in any case. The information shared will remain confidential.
INSTRUCTIONS:
2 Your feedback is highly valuable. Hence, kindly be honest about your views. Name-
Age – Gender –
2. Do you think ambience of the food joints influences your choice for a particular food joint?
o Strongly agree
o Agree
51
o Strongly disagree.
3. Does McDonald’s have better ambience in terms of cleaniness and crowd as compared to Burger
King
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
.5. The food products provided by Burger King are more reasonably pricedthan that of McDonald’s.
o Strongly agree
o Agree
52
o Disagree
o Strongly disagree.
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
8. When it is about fresh chicken, I prefer Mc Donald’s as the chicken tastes fresh but not only juicy
and yummy?
o Strongly agree
o Agree
53
8. When it is about fresh chicken, I prefer Mc Donald’s as the chicken tastes fresh but
not only juicy and yummy?
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
9. Home Delivery Services of McDonalds’ are better than than of Burger King
o Strongly agree
o Agree
o Disagree
o Strongly disagree.
10. The presentation of food of Mcdonald’s is more appealing than that of Burger King? o
Strongly agree
o Agree
o Disagree
o Strongly disagree.
54