McDonald is one of the fast food operating in a dozen of destinations all over the world. The McDonald was started in the year 1937 by McDonald and Dick in Pasadena, California. During the early years of its establishment, McDonald specialized in offering shakes and hotdogs. The business recorded the successes that were not expected by the founders. In the year 1948, the business was temporarily closed down in order for the founders to come up with the new strategies that were meant to take the business to the greater heights. In the same year, the McDonald came with the model that was meant to ensure that the products that the company offered to the market are affordable to the families who want to eat away from their homes. In the same year, the McDonald launched "Speedy-Services-System" that was meant to provide fast services to the customers especially who were in employment and could not afford wasting time queuing for foods at the restaurants. The strategies that were introduced by the McDonald were very successful. In its strategy that was meant to expand their operations to other places, the McDonald sold the first franchise to Neil Fox in the year 1952. Neil Fox is known for creating the "golden arch" that has being used to identify the McDonald ever since (Kincheloe, 2002).
In analyzing the McDonald, trends, threats, weaknesses, strengths, and opportunities are important as they show the affairs of the company over the period that the company has being in operation. The McDonald's SWOTT analysis helps to show that despite the numerous threats that the company has to contend with over time, the company occupies a strong position in the fast-food industry all over the world. The SWOTT analysis of the McDonald helps to show that the company has a lot of strengths that has exploited to gain competitive advantage. However, the SWOTT analysis of the McDonald shows that the company has numerous weaknesses that can be turned around to ensure that the company adopts its strategy to win that was successfully implemented by Jim Cantalupo.
There are also numerous strategies that have being successfully being implemented by the McDonald that accounts for the success of the company. One of such strategy is franchising; about 60% of the total sales recorded by the company can be accounted for by the franchising endeavors by the company. Another strategy that has boosted the McDonald success is its "Plan to Win." The strategy identifies five factors in the company that ensures it success which include price, people, product place and promotion. The McDonald knows that people or the employees are the most important assets for the organization that ensures that the company meets its successes. The McDonald therefore ensures that it employees more employees during peak periods so as not to overwork its employees and at the same time ensure that the employees are given better pay as compared to other companies in fast-food industry (Love, 2005).
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One of the strength that is attributed to the McDonald is that it is known all over the world. The McDonald operates in more than 100 countries and employees more than 32,000 workers both directly and indirectly. This ensures that the McDonald has a global niche where it satisfies its customers in many destinations in the world. This has created a strong brand name for the company and thus loyal customers who would make repeat purchases from the company regardless of where the company is situated in the world.
Another strength that is attributed to the McDonald Company is the fact that the McDonald also operates in real estates industry. The real estate ensures that the company has more space where it can expand its operations. It is interesting to note that in many situations where the McDonald has a restaurant, it also owns that building where that restaurant is situated. The McDonald thus attracts the customers to let out space from the building and thus additional revenue to the company which helps the company finance the operation in some restaurants that are performing dismally (Love, 2005).
The McDonald strength comes from its ability to bring new products in the market that are not provided by other companies in the fast-food industry. The McDonald has the credit of being innovative among its competitors in the market. The company aims at provided the products of high quality to its customers and at the same time ensuring that the product are health conscious. In the market today, the fast food businesses have being castigated by the fact that they encourage unhealthy lifestyle especially among the youth. In the wake of the campaigns against obesity, the fast-food companies are forced to introduce new menu if they are interested in staying in the market for long (Kincheloe, 2002).
The success of the McDonald in the fast-food industry can be associated with its review on its operations by introducing quick-services restaurants. The services are aimed provided the products to the customers efficiently. The McDonald mostly targets the young-working class families who have no much time to waste. Therefore the speed at which the company serves its customers becomes a sure way of earning the company a competitive advantage in the market (Love, 2005).
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Another strength that is attributed to the McDonald is that it has large market size. The company thus is in a position to reap advantages of economies of scale. Due to it size, the McDonald is able to produce its product at low costs and thus the final products to the customers are sold at low prices. This is possible because the Company can bargain with its supplies to get the raw material at low costs. In the markets where the customers are price sensitive, a slight change in the prices will definitely affect the sales made by the company. Thus keeping the prices of the products low will create wide customer base for the McDonald and thus a competitive advantage to the company.
Another strength that ensures the success of the McDonald is the sound management the company has had over the year. One of the notable leaders in McDonald is Jim Cantalupo who successfully implemented "Plan to Win" strategy. The strategy emphasized on the factors such as people, products, price, place and promotion. According to Jim, the people who include the employees and the customers should be the focus of the company. The company has improved environment to its workers by employing more workers to handle the growing number of customers at the same time increasing amount of pay to its workforce. In recognizing the need to attract and retain customer, McDonald has added more products to its menu at the same time ensuring that the products they offer in the market are health-friendly (Kincheloe, 2002).
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There are numerous opportunities are available to the McDonald that should be exploited for the organization to achieve it goals and objectives. One of the opportunity that is available to the McDonald diversification of its operations. The company has the option of diversifying its operation to include providing other products that are not with the bracket of fast-food. The McDonald, for instance can provide meals that are taken inside the restaurants as opposed to its traditional fast food it offers to the market. The McDonald has the option of acquiring other companies in the fast-food industry to consolidate its market share (Porter, 2006).
The McDonald also has the opportunity of introducing low-cost menu. The fast-foods products are mostly targeted to the youth and the low-income members of the community. Thus lowering the prices of the products it offers to the market will endear the company to its customers and thus creating a strong brand name.
There are various weaknesses that are attributed to the McDonald. One of the weakness that face the McDonald is that poor customer-services among the companies that operate in the fast food industry. In fact, the McDonald is ranked Sixth in Customer services in fast-food industry. The accuracy of the services offered by the McDonald is also very low; in accuracy McDonald is ranked ninetieth in the fast-food industry.
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Another weakness that is attributed to McDonald is that the quality of the products it offers to the market is inconsistent. The customers to not now what to expect that thus reducing the confidence they have on the company's product. There is a common complain that the hamburger offered by the McDonald are of the lowest quality in the market (Porter, 2006).
The McDonald is facing stiff competition from other players in fast-food industry. The McDonald is faced by the price wars from the competitors, product innovation where the rival firms provide the products that are of high quality and the growth of market share recorded by the competitors.
Another threat facing the McDonald is the health issues surrounding the products produced by the McDonald. The consumers in the market are demanding for the health-conscious products. The weak economies in the market the McDonald is providing its products also pose a threat to the company (Porter, 2006).
The trend shows how the company performed financially over a period of time. The current ratio grew from 0.524368 in 1998 to 0.727829 in 2003. This show that the company ability to pay for short term liabilities improved with time. The return on equity declined from 0.162282 in 1998 to 0.123051 in 2003; this shows that the investors' return on the amount of investment they made reduced from 1998 to 2003. The company therefore is not the best to make investments in.
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In conclusion, McDonald occupies a strong position in the fast-food industry. The SWOTT analysis indicates that they are numerous strengths that the McDonald has adopted in order emerge the top in industry. The company has turned around the weaknesses that are available in the company to ensure that it succeeds. One of the strategies that have being applied by the McDonald is the "Plan to Win" that has being successfully implemented by Jim Cantalupo.
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