INTRODUCATION:

MC DONALD’S:

The McDonalds’ concept was introduced in San Bernardino,California by Dick and MacDonald of Manchester, New Hampshire. It was modified and expanded by their business partner, Ray Kroc, of Oak Park, Illinois, who later bought out the business interests of the McDonald's brothers in the concept and went on to found McDonald's Corporation.

The business began in 1940, with a restaurant opened by brothers Richard and Maurice McDonald in San Bernardino, California. Their introduction of the "Speedee Service System" in 1948 established the principles of the modern fast-food restaurant. In 1954, Ray Kroc, a seller of Multimixer milkshake machines, learned that brothers Richard and Maurice (Dick and Mac) McDonald were using eight of his high-tech Multimixers in their San Bernardino, California, restaurant. His curiosity was piqued, and he went to San Bernardino to take a look at the McDonalds' restaurant.

KFC: KFC, known as Kentucky Fried Chicken, is a chain of fast food restaurants based in Louisville, Kentucky.

In the midst of the depression, Harland Sanders who was born just outside Henryville( Indiana), opens his first restaurant in the small front room of a gas station in Corbin, Kentucky.Sanders serves as station operator, chief cook and cashier and names the dining area "Sanders Court & Café."

In 1936, Kentucky Governor Ruby Laffoon makes Harland Sanders an honorary Kentucky Colonel in recognition of his contributions to the state's cuisine.The Sanders Court & Café adds a motel and expands the restaurant to 142 seats.

In 1952,the Colonel began actively franchising his chicken business by traveling from town to town and cooking batches of chicken for restaurant owners and employees and awarded Pete Harman of Salt Lake City with the first KFC franchise.

In 1957 Kentucky Fried Chicken first sold in buckets.

OBJECTIVES:

MCDONALD’S: To serve good food in a friendly and fun environment To be a socially responsible company To provide good returns to its shareholders To provide its customers with food of a high standard,quick service and value for money.

KFC:

To have the biggest market share, and provide good service for customers. Also sell good food that help the aims and objectives of kfc are not only to sell chicken to make money and make a profit, they are to expand as a business whether that's to be a world wide business or just to open up a phew more restaurants around the country to provide a better service/faster service/better customer service to beat competitors/rivals such as mc donalds , burger king.

CHAPTER:

SUB CHAPTER 1:

A brief history of McDonald's

PHOTO: The first McDonald's was built in 1940 by the McDonald brothers (Dick and Mac).

1954

Ray Kroc became the first franchisee appointed by Mac and Dick McDonald in San Bernardino, California.

1955

Ray Kroc opened his first restaurant in Des Plaines, Illinois (near Chicago), and the McDonald's Corporation was created.

1957

Quality, Service, Cleanliness and Value (Q.S.C. & V.) became the company motto.

1959

The 100th McDonald's opened in Chicago.

PHOTO: The McDonald brothers (Dick right and Mac center) discussing plans with an executive.

1961

Ray Kroc bought all rights to the McDonald's concept from the McDonald's brothers for $2.7 million. Hamburger University opened in Elk Grove, near Chicago.

1963

One billion hamburgers sold

The 500th restaurant opened. The 500th student graduates from Hamburger University.

Ronald McDonald made his debut. McDonald's net income exceeded $1 million.

1964

Filet-o-Fish sandwich introduced.

1965

McDonald's Corporation went public. Per earning ratio varies from 10 to 22 during year; stock price range, 15 - 33.5.

1966

McDonald's listed on the New York stock exchange on the 7th May.

1967

The first restaurants outside of the USA opened in Canada and Puerto Rico.

1968

The Big Mac was introduced. The 1,000th restaurant opened in Des Plaines, Illinois.

1970

McDonald's restaurant in every US state. Ray Cesca (Director of Global Purchasing of the McDonald's Corporation) has admitted that when McDonald's opened stores in Costa Rica in 1970, they were using beef from cattle raised on ex-rainforest land, deforested in the 1950's and 1960's. New countries - Virgin Islands, Costa Rica.

PHOTO: The first Japanese McDonald's in Tokyo.

1971

The Egg McMuffin sandwich was test marketed in the US as McDonald's first breakfast menu item. McDonald's Japanese President, Den Fujita, stated "the reason Japanese people are so short and have yellow skins is because they have eaten nothing but fish and rice for two thousand years"; "if we eat McDonald's hamburgers and potatoes for a thousand years we will become taller, our skin become white and our hair blonde". New countries - Japan, Holland, Australia, Germany, Panama, Guam.

1972

Assets exceeded $500 million and sales surpassed $1 billion. A new McDonald's restaurant opening every day.

New countries - France, El Salvador. The 2,000th restaurant opened in Des Plaines, Illinois. The Quarter Pounder was introduced. Ray Kroc made a $250,000 donation to the controversial 1972 presidential campaign of Richard Nixon, a donation which was perhaps a subject of investigation during the Watergate corruption scandal. Passages in the 'Behind The Arches' book (written with McDonald's backing and assistance) state that the donation came around the very time that McDonald's franchisees were lobbying to prevent an increase in the minimum wage, and to get legislation (dubbed 'The McDonald's Bill') passed to be able to pay a sub- minimum wage to some young workers.

1973

McDonald's Golden Arches Restaurants Limited founded in UK as a joint venture partnership between the McDonald's Corporation and two businessmen; one British, one American. New country - Sweden. Egg McMuffin introduced.

1974

The 3,000th McDonald's restaurant was opened in Woolwich (south east London) in October, the first in the UK. The company admitted that NOBODY went in and later decided to target children with TV ads. The UK Head Office was sited in Hampstead, North London. Up to 1974, McDonald's employees in Puerto Rico were unionised, but the company was sold to a new franchisee. A dispute followed, closing all the stores and McDonald's pulled out of Puerto Rico. They reopened in 1980 with non-union labour. New countries - England, Netherlands, Antilles, Guatemala. The first Ronald McDonald House opened in Philadelphia. At a San Francisco Labor Board hearing, McDonald's workers testified that lie-detectors had been used to ask about union sympathies, following which the company was threatened with legal action.

PHOTO: McDonald's buildings have undergone dramatic changes from the first one opened by Kroc in 1955 (top) which is now preserved as a museum, to this ultra modern restaurant opened in 1983 in New Orleans (bottom).

1975

The company's first Drive-Thru opened in Sierra Vista, Arizona. New countries - Hong Kong, Bahamas, Nicaragua. Fred Turner becomes Chairman, Ray Kroc Senior Chairman, and Ed Schmitt becomes President. Broadcast advertising appeared in UK cinemas.

1976

McDonald's first UK TV advertisement was broadcast. 4,000th store opened in Canada. New countries - Switzerland, New Zealand. Largest restaurant opens - with 334 seats.

1977

New countries - Ireland, Austria. Breakfast menu introduced, nationally in America.

1978

The 5,000th restaurant opened in Kanagawa, Japan and it made US $1 million in its first year. Sundaes introduced in USA.

In one store in Chicago (USA), a majority of McDonald's workers joined a union. The company then took legal action to stop recognition for the union unless they could get a majority in the 8 stores run by the franchisee. New country - Belgium.

1979

A 7 month strike in Dublin (Ireland) lead to recognition of the ITGWU union. In 1985, two union activists won a victory at a labour court after claiming victimisation and unfair dismissal. New countries - Brazil and Singapore.

1980

The 6,000th restaurant opened in Munich. After workers in a store in Detroit (USA) joined a union, the company organised a visit by a top baseball star, staff disco, and 'McBingo' prior to elections for union representation. First floating restaurant on a steamer in Missouri. 1,000th international restaurant opened.

1981

New countries - Spain, Denmark and Malaysia.

1982

Geoffrey Guiliano, a main Ronald McDonald actor, quit and publicly apologised, stating "I brainwashed youngsters into doing wrong. I want to say sorry to children everywhere for selling out to concerns who make millions by murdering animals". 7,000th restaurant opened in Washington DC. McDonald's were responsible for food poisoning outbreak caused by E. Coli bacteria, which affected 47 people in Oregon and Michigan, USA. Egon Ronay calls McDonald's burgers 'uninspiring'. Breakfast was introduced to the British menu.

PHOTO: The $40 million 'Hamburger University'.

1983

The McDonald's Corporation became sole owners of McDonald's in the UK. The Company is named McDonald's Hamburgers Limited. Five consignments of Brazilian beef are secretly imported for McDonald's UK stores. The 100th UK restaurant opened in Market Street, Manchester. New country - Norway. Introduction of Chicken McNuggets in USA. New Hamburger University campus opens in Oak Brook, Illinois. Set in 80 wooded acres. Training is provided for every level of McDonald's management worldwide. A lodge with 154 rooms in also on the same site. In Arkansas (USA), the UFCW union, which was interested in recruiting McDonald's workers, was involved in a union dispute at a chicken processing plant supplying McDonald's. The union launched a boycott of McDonald's 'McNuggets' and picketed many of its stores. Stan Stein (McDonald's Head of Personnel and Labour Relations) spent up to '80%' of a whole year fighting the union's campaign.

1984

Founder Ray Kroc dies. James Huberty shoots 22 people dead at a McDonald's in San Diego (USA). 50 billionth hamburger sold. Ronald McDonald Children's Charities is founded in his memory to raise funds in support of child welfare.

A McDonald's pamphlet which is distributed to health professionals in the UK states: "There is a considerable amount of evidence to suggest that many of the diseases which are more common in the western, affluent world - diseases such as obesity, diabetes, high blood pressure, heart disease, stroke, and some forms of cancer - are related to diet. The typical western diet is relatively low in dietary fibre (roughage) and high in fat, salt and sugar."

McDonald's now serves 17 million customers a day - equivalent to serving lunch to the entire population of Australia and New Zealand. If McDonald's lined up all the hamburgers sold since 1955, they would:-

Circle the equator 103.75 times; Reach to the moon and back 5 times.

PHOTO: Ray Kroc demonstrating his fetish for cleanliness.

1985

London Greenpeace (a radical group of civil rights and environmental campaigners, independent of Greenpeace International) launches a campaign intended to expose the reality behind the advertising mask of the fast food chains, including McDonald's. Sergio Quintana, the sales director of Coop Montecillos (the sole supplier of beef to McDonald's stores in Costa Rica since 1970), stated on camera that his company's beef was being supplied to McDonald's in the USA.

1986

Drive-Thru restaurants opened in UK at Fallowfield, Dudley, Neasden and Coventry. Four workers in Madrid who had called for union elections were sacked by McDonald's. The company was forced to reinstate the workers after the labour court ruled that the dismissals were illegal. The 200th UK restaurant opened in lpswich.

PICTURE: Cover of the "What's wrong with McDonald's?" factsheet produced by London Greenpeace.

McDonald's became the first UK restaurant group to introduce nutritional information, throughout the country, for the benefit of customers. London Greenpeace published a 6-sided factsheet entitled "What's Wrong With McDonald's? - Everything They Don't Want You To Know". The first UK franchisee-operated restaurant opened in Hayes, Middlesex. The first World Day of Action Against McDonald's was held on 16th October (UN 'World Food Day').

1987

The Attorneys General of Texas, California and New York threatened to sue McDonald's under the consumer protection laws over an advertising campaign claiming that McDonald's food is nutritious. The Attorneys General concluded that the campaign was deceptive because "McDonald's food is, as a whole, not nutritious." McDonald's is serving 20 million people a day in nearly 10,000 restaurants in 47 countries. The UK Midlands regional training centre opened in Sutton Coldfield. McDonald's started legal proceedings against the Transnationals Information Centre (an independent research and action group based in London) over a booklet they produced called "Working for Big Mac" which was highly critical of the company's employment practices. The TIC backed down lacking resources to fight the case to trial, discontinued publication and distribution of the booklet (which was pulped), and the organisation itself went bust.

1988

McDonald's sponsored the Child of Achievement Awards. CFCs ceased to be used for most of McDonald's styrofoam packaging. 300th UK restaurant opened in Dagenham, Essex.

PHOTO:An ad in a German newspaper which aims to counter criticism that McDonald's is changing German restaurant traditions for the worse.

1989

Italian designer Valentino attempts in a Rome court to stop McDonald's opening near the Piazza di Spagna, complaining of "noise and disgusting odours". McDonald's is listed on the Frankfurt, Munich, Paris and Tokyo stock exchanges. The Bournemouth Advertiser (UK) is threatened with a libel action by McDonald's over an article which discussed the captive-bolt method of slaughter for cattle. The newspaper backed down and published an apology. Michael Quinlan is appointed Chairman and Chief Executive Officer. The UK company's name was changed to McDonald's Restaurants Limited. McDonald's send undercover private investigators to infiltrate London Greenpeace over a period of 20 months. McDonald's charity for child welfare fundraising, Ronald McDonald Children's Charities, was registered. McDonald's Child of Achievement Awards were presented by UK Prime Minister Mrs Margaret Thatcher. The UK Manchester regional training centre was opened. McDonald's stores in Philadelphia (USA) were independently surveyed and accused of having racist differential wage rates between the inner-city stores (mostly black workers) and the suburbs (mostly white workers).

1990

September - libel writs were served on five supporters of London Greenpeace, three of whom feel unable to fight the case. The McLibel Support Campaign is set up to generate solidarity and financial backing for the McLibel Defendants. McDonald's opened in Pushkin Square and Gorky Street, Moscow. McDonald's opened at a UK airport at North Terminal, Gatwick. The first Ronald McDonald House opened at Guy's Hospital, London. McDonald's Child of Achievement Awards attended by HRH The Princess of Wales.

1991

McDonald's were responsible for a serious food poisoning outbreak in Preston (UK), when several customers were hospitalised as a result of eating undercooked burgers contaminated by potentially deadly E.Coli 0157H bacteria. The 150th Ronald McDonald House opened in Paris. McDonald's opened in Beijing, China. The 400th UK restaurant (and first in Northern Ireland) is opened in Belfast. McDonald's opens in Hampstead (North London) despite strong opposition from local residents.

PHOTO: A 1950's newspaper advert.

1992

Mark Hopkins, a McDonald's worker in Manchester (UK), was fatally electrocuted on touching a 'fat filtering unit' in the 'wash-up' area of the store. The manager of a Newcastle store (UK) was jailed for 6 months for inducing a crew member to phone through a hoax bomb threat to nearby Burger King in order to boost sales at McDonald's. McDonald's Child of Achievement Awards attended by UK Prime Minister John Major. McDonald's opened in a railway station at Liverpool Street, London. A UK Health & Safety Executive report made 23 recommendations for improvements in the safety of employees. One of its conclusions was "The application of McDonald's hustle policy [ie. getting staff to work at speed] in many restaurants was, in effect, putting the service of the customer before the safety of employees."

Visitors to Salisbury Cathedral (UK) are offered two burgers for the price of one if they buy a commemorative parchment scroll. The idea is dropped when the bishop gets back from holiday. First restaurant in a European hospital opened at Guy's Hospital, London.

1993

The first McDonald's at sea opened aboard the Silja Europa, the world's largest ferry sailing between Stockholm and Helsinki. The Paris planning authorities refuse permission for a McDonald's under the Eiffel Tower. The second Ronald McDonald House opened at Alder Hey Children's Hospital, Liverpool. 500th UK restaurant opened in Notting Hill Gate, London. First UK operated restaurant on a ship opened on the Stena Sealink ferry "Fantasia" sailing between Dover and Calais. McDonald's sponsored athletics in the UK through the McDonald's Young Athletes' League and the International invitational meeting the McDonald's Games.

1994

McLibel Trial starts on 28th June. Restaurants opened in Bahrain, Bulgaria, Egypt, Kuwait, Latvia, Oman, New Caledonia, Trinidad and United Arab Emirates, bringing the total to over 15,000 in 79 countries on 6 continents. McDonald's celebrated twenty years of operating in the UK. McDonald's environmental image was revealed to be a sham, and customers being conned when it was discovered that rubbish which customers were asked to put into separated recycling bins throughout New Zealand stores was sent to the tip. McDonald's achieved the highest ever grade under the Royal Society for the Prevention of Accidents (RoSPA)Quality Safety Audit scheme. McDonald's was voted the 'Most Parent Friendly' restaurant in the UK for the second successive year by the Tommy's Parent Friendly Campaign, supported by the Daily Telegraph. Workers in an Ontario store (Canada) joined a union, but the company managed to avoid recognition by ensuring victory in Labour Board sponsored elections. The McLibel Defendants issue a countersuit for libel against McDonald's over the company's accusation in a leaflet that they are telling lies. Five McDonald's managers are arrested in Lyon, France for trying to rig union elections. On 1st October, McDonald's UK executives held a celebration along with a jazz band and clown at their Woolwich store to mark 20 years since this first store opened in the UK. Twenty five London Greenpeace and McLibel supporters gathered with a banner reading "20 Years of McGarbage" and handed out 4000 "What's Wrong With McDonald's?" leaflets to passers-by. In October, there is an demonstration at McDonald's European headquarters in London where sackfuls of the company's litter picked up off the streets are returned. 500 people attend the National March Against McDonald's through central London to protest against the company's exploitation of people, animals and the environment. The company threatens legal action against a topless restaurant in Australia called "McTits".

PHOTO:An ad in a German newspaper which aims to counter criticism that McDonald's is changing German restaurant traditions for the worse.

1995

McLibel Trial becomes the longest libel trial in British history on Day 102 in March. On 15th April, there were international protests to mark the 40th anniversary of the opening of the world's first store of the McDonald's Corporation, and to celebrate 10 years of co-ordinated international resistance to McDonald's. On the first anniversary of the McLibel Trial (28th June), it becomes known that McDonald's had initiated secret settlement negotiations and had twice flown members of their US Board of Directors to London to meet with the McLibel Defendants in an attempt to bring the case to an end.

12th October, the third anniversary of the death of Mark Hopkins, was a Day of Solidarity With McDonald's Workers in the UK. On 16th October, the 11th annual Worldwide Day of Action Against McDonald's, there were protests in at least 20 countries. In the UK, at least 250 of the company's 600 stores were leafletted. On 11th December (Day 199 of the trial), the McLibel Trial becomes the longest civil case in English history. Following widespread opposition by local residents, McDonald's were refused permission to open an outlet at their European headquarters in north London.

1996

February 16th 10am, the McSpotlight website was launched. In March, the public's intense concern over the links between the cattle disease BSE and its human equivalent CJD forced McDonald's UK to ban British beef. The company did not sell any beef products for a week while supposedly waiting for beef supplies to arrive from other EU countries. The "Vegetable Deluxe" was launched in the UK. McDonald's opened stores in India. McDonald's and Disney announced a deal giving McDonald's exclusive rights to use characters from Disney films in its promotions around the world for 10 years. Commentators called it the biggest global marketing alliance yet devised. McDonald's opened a store in Belarus, its 100th country. The movie star Robin Williams turned down a million-pound offer to advertise McDonald's. McDonald's threatened the owner of a UK sandwich bar called "McMunchies" with legal action for breach of trademark. A retired Scottish school-teacher called Ronald McDonald, and the chief of the McDonald clan in Scotland were both outraged at this further attempt by McDonald's to claim global dominion over the prefix "Mc" and the name "McDonald" which has been an Irish and Scottish family name for centuries. The Supreme Court of Denmark ruled against McDonald's claim that a sausage stand called "McAllan's" was in breach of its trademark. Following widespread opposition by local residents in Winchmore Hill (north London) which put a lot of pressure on the local MP (Michael Portillo, the Defence Secretary), McDonald's were refused permission to convert the local Conservative Association HQ into a Drive-Thru. McDonald's sued for breach of trademark a Jamaican fast-food company (called the McDonald's Corporation Limited) which had been operating in Jamaica since the early 1970's. The Jamaican company succeeded in getting information from the McLibel Trial taken from the Internet ruled admissible in the case, and in getting an order barring McDonald's from opening stores in the country until the courtcase was completed. McDonald's succeeded in its trademark battle in South Africa, when an appeal court prohibited competitors from using its name and the golden arches symbol. McDonald's began spending $200 million on a promotional blitz in the USA & Canada to lure adults to visit their outlets. This included the launch of the new adult burger, the "Arch Deluxe" in May. Despite this blitz, US sales continued to fall. The parents of a child, who died from E.Coli 0157 food poisoning after eating McDonald's burgers in Spain and England, began legal proceedings for compensation in the USA. Meanwhile, three children who suffered E.Coli 0157 food poisoning in England also from McDonald's burgers were granted legal aid to sue McDonald's and their supplier McKey's. McDonald's opened the world's first fast-food ski-through in the Lindvallen resort (Sweden). The McLibel Trial became the longest trial of any kind in English legal history in November. The evidence was completed in July, and the closing speeches in December, but the Judge reserved his Judgment until the following year.

PHOTO: Ray Kroc

A Brief History Of KFC:

1939 Colonel Harland D. Sanders perfects secret blend of 11 herbs and spices in Corbin, Ky., restaurant.

1952 Pete Harman in Salt Lake City becomes the first Kentucky Fried Chicken franchisee.

1956 Colonel Sanders sells Corbin, Ky., restaurant and goes on the road to enlist new franchisees. The Colonel signs his first international franchisee in Canada.

1964 KFC sold to a group of investors including John Y. Brown Jr. and Jack Massey for $2 million.

1969 KFC listed on New York Stock Exchange. Colonel Sanders buys first 100 shares.

1971 KFC acquired by Heublein Inc.

1980 Colonel Sanders dies and is buried in Louisville's Cave Hill cemetery.

1982 KFC becomes a subsidiary of R.J.Reynolds Industries when Heublein Inc. is acquired by RJR (now RJR Nabisco, Inc.).

1986 KFC becomes a subsidiary of PepsiCo, Inc. for $840 million. Grand opening of Colonel Sanders Technical Center in Louisville, Ky.

1987 KFC opens first Western-style quick service restaurant in China.

1991 A new logo is introduced to emphasize chicken variety -- replacing "Kentucky Fried Chicken" with "KFC".

1993 KFC adds non-fried chicken to menus in the U.S. and Australia.

1994 KFC officially opens its 9,000th restaurant in the world- in Shanghai, China- and announces a $200 million investment over the next four years for 200 restaurants in 48 Chinese cities.

1995 KFC introduces Colonel's Crispy Strips® and smashes Guinness record with "World's Largest Pot Pie" in New York City to introduce Chunky Chicken Pot Pie. Opens first restaurant in Moscow.

1996 KFC introduces Tender Roast® chicken pieces and brings back one of the world's most recognized packages -- the bucket.

1997KFC introduces Honey BBQ-flavored Tender Roast®, Spicy Buffalo Crispy StripsTM and Chicken TwisterTM -- chicken and veggies "like a meal all wrapped up and ready to go."

SUB CHAPTER 2:

MARKETING STRATEGIES OF MCDONALDS:

CHALLENGES IN ENTERING INDIAN MARKET:

REGIOCENTRICISM:Re-engineering the menu-McDonald’s has continually adapted to the customer’s taste ,value system ,lifestyle ,language and perception .Globally McDonald’s was known for its hamburgers ,beef and pork burger .Most Indians are barred by religious not to consumer beef and pork burgers .To survive ,the company had to be responsive to the Indian sensitivities .So McDonald came up with chicken ,lamb and fish burgers to suite the Indian palate.

THE VEGETARIAN CUSTOMER-Indian has a huge population of vegetarians. To cater to this customer segment ,the company came up with a completely new line of vegetarian items like Mc Aloo Tikki. The separation of vegetarian and non-vegetarians sectors is maintained throughout the various stages.

SEGMENTATION, TARGETING AND POSITIONING:

McDonald’s uses demographic segmentation strategy with age as the parameter. The main target segments are children ,youth and the young urban family.

CHARTS TO BE DONE”

As shown above, kids reign supreme in FMCG purchase related to food products. So to attract children McDonalds has Happy Meal with which toys ranging from hot wheels to various Walt Disney characters are given (the latest in this range is the toys of the movie Madagascar). For this, they have a tie-up with Walt Disney. At several outlets, it also provides special facilities like ‘Play Place’where children can play arcade games, air hockey, etc. This strategy is aimed at making McDonald’s a fun place to eat. This also helps McDonald’s to attract the young urban families wanting to spend some quality time while their children have fun at the outlet. To target the teenagers, McDonald’s has priced several products aggressively, keeping in mind the price sensitivity of this target customer. In addition, facilities like Wi-Fi are also provided to attract students to the outlets like the one at Vile Parle in Mumbai.

“Mc Donald’s mein hai kuch baat”projects McDonald’s as a place for the whole family to enjoy. When McDonald’s entered in India it was mainly perceived as targeting the urban upper class people. Today it positions itself as an affordable place to eat without compromising on the quality of food, service and hygiene. The outlet ambience and mild background music highlight the comfort that McDonald’s promises in slogans like “You deserve a Break Today” & “Feed your inner child”. This commitment of quality of food and service in a clean, hygienic and relaxing atmosphere has ensured that McDonald’s maintains a positive relationship with the customers.

CUSTOMER PERCEPTION AND CUSTOMER EXPECTATION:

Customer perception is a key factor affecting a product’s success. Many potentially revolutionary products have failed simply because of their inability to build a healthy perception about themselves in the customers’ minds. McDonalds being an internationally Customer renowned brand brings with it certain expectations the children.

TARGET SEGMENT WHA IS MCDONALD’S FOR ME?A family with children A treat to children, a fun place to be for the children.Urban customer on the move

Great taste ,quick services without affecting the work schedule.

Teenager Hangout with friends , but keep it affordable.

Customers expect it to be an ambient, hygienic and a little sophisticated brand that respects their values. The customer’s expect the brand to enhance their self-image. Customer responses obtained at the Vile Parle, Mumbai outlet confirmed the fact that they connect strongly with the brand. However, fulfilling some of the customer expectations like a broader product variety provide McDonald’s a great scope for improvement.

MCDONALDS MARKETING MIX(5 P’S):

After segmenting the market, finding the target segment and positioning itself, each company needs to come up with an offer. The 5 P’s used by McDonalds are:

1. Product

2. Place

3. Price

4. Promotion

5. People.

PRODUCT: How should the company design, manufacture the product so that it enhances the experience? Product is the physical product or service offered to the consumer. Product includes certain aspects such as packaging, guarantee, looks etc. This includes both the tangible and the non-tangible aspects of the product and service. McDonalds has intentionally kept its product depth and product width limited. McDonalds studied the behaviour of the Indian customer and provided a totally different menu as compared to its International offering. It dropped ham, beef and mutton burgers from the menu. India is the only country where McDonalds serve vegetarian menu. Even the sauces and cheese used in India are 100% vegetarian. McDonalds continuously innovates its products according to the changing preferences and tastes of its customers. The recent example is the introduction of the Chicken Maharaja Mac. McDonalds bring with it a globally reputed brand, world class food quality and excellent customer specific product feature

PLACE: Where should be the product be available and the role of distribution channels?The place mainly consists of the distribution channels. It is important so that the product is available to the customer at the right place, at the right time in the right quantity. Nearly 50% of U.S.A is within a 3 minute drive from a McDonald’s outlet.

There is a certain degree of fun and happiness that a customer feels each time he dines at McDonalds. There are certain value propositions that McDonalds offer to its customers based on their needs. McDonalds offers hygienic environment, good ambience and great service. Now McDonalds have also started giving internet facility at their centres and they have been playing music through radio instead of the normal music. There are certain dedicated areas for children where they can play while their parents can have some quality time together.

PRICE: What should be the pricing strategy?

LOW QUALITY HIGH

LOW

PRICE

Pricing includes the list price, the discount functions available, the financing options available etc. It should also take into the consideration the probable reaction from the competitor to the pricing strategy. This is the most important part of the marketing mix as this is the only part which generates revenue. All the other

Expenses incurred. The price must take into consideration the appropriate demand-supply equation.

McDonald’s came up with a very catchy punch line “Aap ke zamane mein ,baap ke zamane ke daam”. This was to attract the middle and lower class consumers and the effect can clearly be seen in the consumer base McDonalds has now. McDonalds has certain value pricing and bundling strategies such as happy meal, combo meal, family meal etc to increase overall sales volumes

PROMOTION: What is the suitable strategy and channels for promotion of the product?

The Various promotion channels being used by McDonald’s to effectively communicate the product information are given above. A clear understanding of the customer value helps decide whether the cost of promotion is worth spending. There are three main objectives of

advertising for McDonald’s are to make people aware of an item, feel positive about it and remember it. The right message has to be communicated to the right audience through t he right media. McDonald’s does its promotion through television, hoardings and bus shelters. They use print ads and the television programmes are also an important marketing medium for promotion. Some of the most famous marketing campaigns of

LOW QUALITY HIGH

LOW

PRICE

ECONOMY PANETRATION

SKIMMING PREMIUM

Sales promotion

Adveritising

Direct marketing

Public relation

Personal selling

Marketing communication

McDonald’s are“You Deserve a break today, so get up and get away- To McDonald’s”• “Aap ke zamane mein ,baap ke zamane ke daam”.•“Food, Folks, and Fun”•“I’m loving it”.

PEOPLE: How to converge the benefits of internal and external marketing?

McDonald’s understands the value of both its employees and its customers. It understands the fact that a happy employee can serve well and result in a happy customer. McDonald continuously does Internal Marketing. This is important as it must precede external marketing. This includes hiring, training and motivating able employees. This way they serve customers well and the final result is a happy customer.

The level of importance has changed to be in the following order (the more important people are at the top):

1. Customers

2 .Front line employees

3. Middle level managers

4. Front line managers

The punch line “I’m loving it” is an attempt to show that the employees are loving their work at McDonalds and will love to serve the customers.

THE MCDONALD’S EXPERIENCE:

Marketing in a services industry is becoming an increasingly complex challenge. The paradigms of service marketing demand a passionate understanding of customer expectations and perceptions, and linking them to product design & delivery as well as operational planning. This is where McDonald’s has excelled due to its ability to successfully integrate the customer’s perspective in its products and operations in a comprehensive manner. The revamped menu in India is an example of McDonald’s strategy of integrating the customer’s perspective in its products. And, the operational integration is evident from McDonald’s emphasis on its suppliers as its customers as well as its treatment of its consumers as co-producers of services. The ultimate aim of Service Marketing is not just to become a Service Leader but to create a Service Brand. The Service Delivery Process is the key to achieving this aim of Service Marketing.

S

During the Service Delivery Process, each moment of interaction between the firm and the customer, called Moments of Truth”, helps understand the opportunities that a firm has to win or lose the customer. For example, these “moments of truth” are created for McDonald’s every time the guard at the McDonald’s outlet

SUPPLEMENTARY PROCESS

SVC DELIVERY PROCESS

CORE PRODUCT

meets the customer, every time an attendant takes down the order from the customer waiting in the queue, every time the cashier interacts with the customer, every time the attendant helps the customer guided the

customer towards the table, every time the attendant cleans the table, etc.

MOMENT OF TRUTH:

CUSTOMER

SERVICES PROVIDER SERVICES DRLIEVERY POINTS

Managing these “moments of truth” is a great challenge in Service Marketing especially due to customer’s involvement as a co-producer of services (e.g. McDonald’s self-service concept wherein the customer not only collects the order but also cleans the table after consuming the food). However, McDonald's has been able to create a great experience for its customers by understanding the nature of the entire Service Delivery Process and the various stages in the process that are exposed to the customers. Transparency in the processes at its outlet has helped McDonald’s bring the back office in its outlet at the front so that the customer is able to know the operations and provide feedback on service design improvements. Internal Customer Focus is equally important as External Customer Orientation in order to win these “moments of truth”. McDonald’s focus on its People and their service delivery methods therefore plays a very important role in creating a

successful Service Brand. The quality and the consistency of the service delivered by McDonald’s have been greatly enhanced by the combination of the factors mentioned above. This has helped McDonald’s become Service Leader and a successful Service Brand. This is evident from the fact that very few of its customers opt for take-home parcels or home deliveries while most of them prefer to eat at the outlet and enjoy the McDonald’s experience.

MCDONALDIZING THE SUPPLIERS:

McDonald’s has changed the nature of not only the food service industry but also the food processing industry as well. McDonald’s realized that the battle between fast food chains would increasingly be one of efficiency of supply, lower cost production and greater desire to innovate. It pioneered with innovative and sophisticated food distribution and packaging systems when the traditional food processors were unwilling or unable to supply food items that McDonald’s demanded. They achieved amazing consistency by devoting more attention than anyone else to field service and training at store level. Production was concentrated in huge plants devoted exclusively to McDonald’s. McDonald’s also started with tiny suppliers and grew with them displaying great loyalty.

Nowhere is the supplier loyalty more evident than in development of new, improved products. Some of McDonald’s classic food items like Filet-o-Fish, French Fries, Chicken Nuggets etc. are results of supplier innovation. Interestingly, it took KFC more than three years before in finally introduced its own version of chicken nuggets. Thus supplier technological expertise had given McDonald’s a product which was not a mere marketing innovation but a technical one. McDonald’s attempted to squeeze labour out of the stores by moving more preparation back into the processing plant, creating the opportunity to develop unique products based on suppliers’ processing skills. For the first time, McDonald’s suppliers became the focal point of new

product development. This converted the fast-food industry’s most fragmented distributed system into more efficient one which helped McDonald’s reduce its inventory and manage costs effectively.

IMPORTANCE OF PRODUCT LIFE CYCLE IN MC DONALDS:

The requirements of customers change over time and thus the product offering has to be changed accordingly. What is the fashion today may be out of market within few weeks. Thus continuous innovation is required.

To counter these changes McDonalds has continuously introduced new products and has phased out the old ones which were at the decline stage of their PLC. The introduction is timed such that the new product does not cannibalize the product already in the maturity or growth stage. Thus the secret lies in getting profits with different products in the different stages of the PLC.

COMPETITOR ANALYSIS:

McDonald’s has been a leading fast-foods outlet in Vile Parle. But the outlet understudy has other competitors eating away into its market share. In addition to its traditional rivals—KFC, Dominos, Pizza Hut—the firm encounters new challenges. Jumbo King competes using a back-to-basics approach of quickly serving up burgers for time-pressed consumers. On the higher end, the KFC has become potent competitor in the quick service field, taking away customers from McDonald’s. Perhaps in the new environment, fast, convenient service is no longer enough to distinguish the firm. At this time, a new critical success factor may be emerging: the need to create a rich, satisfying experience for consumers. This brings us to service and experience based competition which McDonald’s can use for competitive advantage against Jumbo King. Keeping in mind the demographics of the area, McDonald’s has Wi-Fi enabled the outlet to cater to the student community .It is for this overall “Food, Fun & Folks” experience that customers pay a premium over the other competitors.

Competition also reduces product lifecycle; inducing firms to revise their products portfolios and to revisit their product market to understand changing needs, expectations and perception of different market segments. The new Mc Breakfast would be introduced between 6 to 11 am as a pilot project. This would open up a whole new revenue stream for McDonald’s by tapping into the student and working population by providing a healthy and wholesome breakfast. This shows how demographic shift can affect the demand for products and services. McDonald’s has anticipated these changes to maintain its competitive edge.

SWOT ANALYSIS:

STRENGTH1.Strong brand2. customer intimacy3.Product innovation4. Supplier Integration.

WEAKNESS1.Low depth and width of product.

OPPORTUNITY1. Expand into tier 2 and tier 3 cities.2. Entry into breakfast category.

THREAT1. Changing customer lifestyle and taste.2. Increased competition from local fast food outlets like Jumbo king.

THE ROAD AHEAD:

Entry to Tier 2 and Tier 3 cities –The main target customer for McDonald’s is the new urban Indian family. With the customer demographics constantly changing and tectonic social and cultural shifts being observed in Tier 2 and Tier 3 cities due to globalization, the company is now expanding to Tier 2 cities like Pune and Jaipur.

Rolling out McBreakfast across all outlets – In India, the company has recently launched its entry into the breakfast food category. This is now launched on a pilot basis on select stores. In Mumbai, it available at the Vile Parle outlet. The company views this category as a key growth driver in future.

EXHIBITS:

1.MCDONALD’S INDIAN MENU

VEGETARIAN NON VEGETARIANMc Veggie Chicken maharaja macMc Aloo Tikki McChicken BurgerPaneer salsa wrap

Shahi chicken mc curry

Cripy Chinese Wrap chicken MexicanMc curry pan Fillet-o-FishPizza mc puff

SUB CHAPTER 2:

MARKETING STRATEGIES OF KFC:MARKETING MIX:

The marketing mix is generally accepted as the use and specification of the 'four Ps' describing the strategic position of a product in the marketplace.

‡ 1.Product

‡ 2.Price

‡ 3. Place

‡ 4.Promotion

PRODUCT:

Product variation

Product differentiation

Product innovation

PRICE:

Cost recovery pricing

Penetration Pricing

Price skimming

PLACE:

Distribution channel

Direct sale

Indirect sales

PROMOTION:

Individual communication

Mass communication

Brand management

Marketing

Mix

PRODUCT: Anything that can be offered to a market to satisfy a want or need. KFC's specialty is fried chicken served in various forms. KFC's primary product is pressure-fried pieces of chicken made with the original recipe. The other chicken offering, extra crispy, is made using a garlic marinade and double dipping The chicken in flour before deep frying in a standard industrial kitchen type machine.PRICE: Price is the any amount of money that customers have to pay while purchasing the product. More broadly, price is the sum of all the values that consumers exchange for benefits of having or using the product or services.. ECONOMIC FACTOR:

Income: Income is an important key factor for KFC. This factor decides which class is to be targeted. In the early rise of KFC they focused on the upper class but slowly are introducing economy meals that attract the lower to middle classes.

Consumption behaviour: Its estimates the behaviour of people their liking and disliking towards the pricing of the product.DEMOGRAPIC FACTOR: ‡

Age: Generally there is no age limit focus by the KFC. The target and focus is on each and every individual in a society. KFC finds its largest demographic in the young of any society.

Gender: Both male and females are focused by KFC, gender does not play any role here.

Household Size: This plays a vital role in the demographic factor of the KFC. Generally they target whole families rather than single persons. This being the reason for their Family Meals which are basically bundled items served at a nominally cheaper rate

GEOGRAPIC LOCATION PREFERENCE: Urban Semi urban

BEHAVIOUR SEGMENTATION:

Taste conscious Quality conscious Class

Combination of product and quality.

PRICING STRATEGY:

MARKETING SKIMMING: KFC globally enters the market using market skimming. Their products are priced high and target the middle to upper class people. Gradually they trickle down the prices focusing on the middle to lower class people to penetrate both sides of the market.

COMPETITION:

We can compare the price of their products with McDonald, Dominoes and Pizza Hut. If the competitor provides the same product at a lower price then the organization usually lowers the price of its product too. In the case of KFC, Fried Chicken is its main selling point and controls a monopoly over the Indian fast food market (only with fried chicken). It prices its burgers, French fries and soft beverages with relation to its competitors.

COST BASED:

KFC price their product keeping different points in view. They adopt the cost base price strategy. Pricing of the product includes the govt. tax and excise duty and then comes the final stage of determine the price of their product. The products are bit high priced according the market segment and it is also comparable to the standard of their product. In the cost based method we include the variable and fixed cost.

PLACE:

TARGET AREAS:

“Free home Delivery” strategy -They provide free home delivery to offices & homes (select countries).

“Accessibility”- Resulting in several outlets to cater to the needs of people in & around the city.

“Hectic lifestyle”-Due to the hectic lifestyle of office going individuals the fast food concept saves times of preparing food and gives the customer a full meal quickly.

“Economically convenient”-The pricing appeals to the many classes of a society.

TARGET MARKET:

1. Location: ± Hectic lifestyle of individuals giving them more time at work and less stress about waiting for food.± Commercialization of urban and sub - urban markets leading to more mid-sector people that find high-end eating joints very to expensive.± Mid-sector people are always looking for change which KFC provides in their range of fast food.± Quality conscious people in urban areas are more conscious about the quality of food than rural areas.± Urban areas are more populated therefore they help with attracting higher revenues.

2. Placement of outlets: Due to KFC placing itself close to schools, colleges, cinemas and markets which are mostly populated by the young and those who are in a hurry, KFC enjoys a large number of footfalls every day. In addition, they also have outlets close to non-vegetarians (mostly Muslim populated areas).

STRATEGY:

Given the competitive nature of fast food joints, KFC uses the Push Strategy to help them create

±Awareness

±Be different

±Sound attractive

CHANNALS:

KFC believes in first level channels in the order given below:

± Manufacturers

± Retailers

± Consumers.

CHANNELS PROCESS:

KFC works on the flow of good operation techniques i.e. Good Operating Manager leads to Good Team Selection Good Services Good Targets Good Revenues through the following internal strategies:

� Training Incentives based targets Recognition for good work Performance based bonus Employee benefits to keep them motivated Promotion

PROMOTION:

Promotion is the method used to inform and educate the chosen target audience about the organization and its products. Using all the resources of promotion:

‡Advertising

‡Sales Promotion

‡ Public Relations

‡ Events and Experiences

‡ Coupons, Discounts and Bundled packages

‡An organization finds most of its meanings and survival through promotion.

At KFC, Promotion is the main tool to bring all chicken lovers attention towards its delicious one-of-a-kind product, the Fried Chicken.

ADVERTISING:

The logo of the smiling Colonel is probably one of the most recognized faces in the world and instantly brings the image of fried chicken to one’s mind.

KFC and its new company jingle ,finger lcikin good´ is a frequent announcement on televisions, billboards, flyers and radio. The concept of showing a normal customer deeply involved in devouring his piece of chicken usually turns on the drool factory in everybody’s mouth and makes them rush to the nearest KFC. In India where chicken lovers are plenty abound these ads featuring normal people connect instantly and create a rush at their outlets. Using the following methods KFC spreads its message of finger further licking good.

Using Reminder advertisements KFC stimulates repeat purchases of its products. The company anthem ³finger linkin good´ is just a wake up call to the consumer to remind them how good they felt the last time they ate KFC chicken

Sponsorship is another tool to strengthen an organizations image. KFC is currently the sponsor of the Australian Cricket Team and the colonel logo can be seen on their uniforms throughout.

SALES PROMOTION:

KFC uses the following tools to further enhances its sales

Premiums Exhibits Coupons Entertainment

‡

SEGMENTATION TARGETING AND POSITIONINGSEGMENTATION:

GEOGRAPHIC SEGMENTATION: KFC has outlets internationally and sells its products according to geographic needs of the customer. In India KFC focuses how geographically its customers demand different products. In north India Chicken is the main selling product, while in the south the Veg. items sell more than the chicken.

DEMOGRAPIC SEGMENTATION: In demographic segmentation, the market is divided into groups based on an age, gender, family size, income, occupation, religion, race and nationality.KFC divides the market on demographic basis in this way:Age is between 6 - 65. Gender is both males and females. Family size is 1-2, 3-4, 5+Income is Rs 10,000 n above. Family lifestyle is almost all.

PSYCHOGRAPIC SEGMENTATION:

Dividing a market into different groups based on social class, lifestyle, Or personality characteristics is called psychographic segmentation.KFC divides market on the basis of psychographic variables like Social class - Upper and Middle class. Lifestyle is not specific. Personality ambitious and authoritarian.

TARGETING:“The process of evaluating each market segment’s attractiveness and selecting two or more segments”. As the outlets of KFC are in posh area and prices are too high (overhead expenses-rent, air-conditioning, employees), so KFC targets upper and middle classes. Target market depends upon size and growth rate of population, Company resources and structural attractiveness of market segment.

POSITIONING:

KFC uses its attributes to Position its Product (Fried Chicken). For a product to occupy a clear, distinctive and desirable place relative to Competing products in the minds of target Consumer . In KFC feedback is taken from the customer in order to know the customer demands and then improvements are made in products. KFC focuses on pure and fresh food in order to create distinct and clear position in the minds of customers KFC has a strong brand name and they are leading the market in fried chicken.

SUB CHAPTER 3:FINANCIAL STATEMENT OF MC DONALD’S:

Currency in As ofMillions of U.S Dollars

Dec 31 2006Restated

Dec 31 2007

Dec 31 2008Reclassified

Dec 31 2009

4 -Year Trend

Revenues 20,895.2 22,786.6 23,522.4 23,522.4TOTAL REVENUES 20,895.2 22,786.6 23,522.4 23,522.4

Cost of goods sold 13,963.2 14,881.4 14,883.2 14,883.2

GROSS PROFIT 6,932.0 7,905.2 8,639.2 8639.2

Selling General &Admin Expenses ,Total

2,295.7 2,367.0 2,355.5 2,234.2

OTHER OPERATING EXPENSES,TOTAL

2,295.7 2,367.0 2,355.5 2,234.2

OPERATING INCOMES 4,636.3 5,538.2 6,283.7 6557.6

Interest Expenses -401.9 -410.1 -522.6 -473.2

Interest and Investment Income 152.0 124.0 85.0 19.0

NET INTEREST EXPENSES -249.9 -286.1 -437.6 -437.2Income (loss) on Equity Investment 76.8 115.6 110.7 167.8Currency Exchange Gains(loss) - -1.0 5.0 32.0Other Non-Operating Income(Expense)

-28.7 -19.8 -12.4 -26.7

EBT,EXCLUDING USUSUAL ITEMS 4,434.5 5,346.9 5,949.4 6,276.5Merger & Restructuring Charges -134.2 - - -Gain(loss) on sales of investment - - 160.1 94.9Gain (loss)on sales of asset -145.9 -1,759.5 54.5 54.5Other unusual items, Total - -15.3 -6.0 61.1Other unusual item - - - 65.2EBT,INCLUDING UNUSUAL ITEMS 4,154.4 3,572.1 6,158 6,487.0Income Tax Expense 1,288.3 1,237.1 1,844.8 1,936.0Earnings from continuing operation

2,866.1 2,335.0 4,313.2 4,551.0

EARNINGS FROM DISCOUNTING OPERATIONS

678.1 60.1 - -

NET INCOME 3,544.2 2,395.1 4,313,2 4,551.0NET INCOME TO COMMON INCLUDING EXTRA ITEMS

3,544.2 2,395.1 4,313.2 4,551.0

NET INCOME TO COMMON EXCLUDING EXTRA ITEMS

2,866.1 2,335.0 4,313.2 4,551.0

ANNUAL BALANCE SHEET OF MC DONALD’S:

Financial data in U .S. Dollar

Values in Millions (Except for per share items)

2009

2008 2007 2006 2005

Period End Date 12/31/2009 12/31/2008 12/31/2007 12/31/2006 12/31/2005

Stmt Source 10-K 10-K 10-K 10-K 10-K

Stmt Source Date 02/26/2010 02/25/2009 02/25/2008 02/25/2008 02/26/2007

Stmt Update Type Updated Updated Updated Restated Reclassified

           

Assets          

Cash and Short Term Investments 1,796.0 2,063.4 1,981.3 2,128.1 4,260.6

Cash & Equivalents

Total Receivables, Net 1,060.4 931.2 1,053.8 806.9 793.9

Accounts Receivable - Trade, Net

Total Inventory 106.2 111.5 125.3 112.4 144.3

Prepaid Expenses 453.7 411.5 421.5 318.6 640.2

Other Current Assets, Total 0.0 0.0 0.0 1,826.2 380.0

Total Current Assets 3,416.3 3,517.6 3,581.9 5,192.2 6,219.0

           

Property/Plant/Equipment, Total - Net 21,531.5 20,254.5 20,984.7 19,438.1 19,573.3

Goodwill, Net 2,425.2 2,237.4 2,301.3 2,073.6 1,924.4

Intangibles, Net 0.0 0.0 0.0 0.0 0.0

Long Term Investments 1,212.7 1,222.3 1,156.4 1,035.4 1,035.4

Note Receivable - Long Term 0.0 0.0 0.0 0.0 0.0

Other Long Term Assets, Total 1,639.2 1,229.7 1,367.4 1,235.2 1,236.7

Other Assets, Total 0.0 0.0 0.0 0.0 0.0

Total Assets 30,224.9 28,461.5 29,391.7 28,974.5 29,988.8

           

Liabilities and Shareholders' Equity          

Accounts Payable 636.0 620.4 624.1 668.7 678.0

Payable/Accrued 0.0 0.0 0.0 0.0 0.0

Accrued Expenses 1,854.8 1,633.0 1,635.3 1,459.5 1,316.6

Notes Payable/Short Term Debt 0.0 0.0 1,126.6 0.0 544.0

Current Port. of LT Debt/Capital Leases 18.1 31.8 864.5 17.7 658.5

Other Current Liabilities, Total 479.8 252.7 248.0 805.7 910.6

Total Current Liabilities 2,988.7 2,537.9 4,498.5 2,951.6 4,107.7

           

Total Long Term Debt 10,560.3 10,186.0 7,310.0 8,389.9 8,934.3

Long Term Debt

Deferred Income Tax 1,278.9 944.9 960.9 1,076.3 949.2

Minority Interest 0.0 0.0 0.0 0.0 0.0

Other Liabilities, Total 1,363.1 1,410.1 1,342.5 1,098.4 851.5

Total Liabilities 16,191.0 15,078.9 14,111.9 13,516.2 14,842.7

           

Redeemable Preferred Stock 0.0 0.0 0.0 0.0 0.0

Preferred Stock - Non Redeemable, Net 0.0 0.0 0.0 0.0 0.0

Common Stock 16.6 16.6 16.6 16.6 16.6

Additional Paid-In Capital 4,853.9 4,600.2 4,226.7 3,445.0 2,720.2

Retained Earnings (Accumulated

Deficit)

31,270.8 28,953.9 26,461.5 25,845.6 23,516.0

Treasury Stock - Common -22,854.8 -20,289.4 -16,762.4 -13,552.2 -10,373.6

ESOP Debt Guarantee -134.6 -98.1 -37.7 0.0 0.0

Other Equity, Total 882.0 199.4 1,375.1 -296.7 -733.1

Total Equity 14,033.9 13,382.6 15,279.8 15,458.3 15,146.1

           

Total Liabilities & Shareholders’

Equity

30,224.9 28,461.5 29,391.7 28,974.5 29,988.8

           

           

Total Common Shares Outstanding 1,076.7 1,115.3 1,165.3 1,203.7 1,263.2

Total Preferred Shares Outstanding 0.0 0.0 0.0 0.0 0.0

10 YEARS SUMMARY OF MC DONALD’S:

Income Statement - 10 Year Summary (in Millions)  Sales EBIT Depreciation Total Net Income EPS Tax Rate (%)

12/09 22,744.7 6,487.0 1,216.2 4,551.0 4.11 29.84

12/08 23,522.4 6,158.0 1,207.8 4,313.2 3.76 29.96

12/07 22,786.6 3,572.1 1,214.1 2,335.0 1.93 34.63

12/06 20,895.2 4,154.4 1,249.9 2,866.1 2.29 31.01

12/05 19,117.3 3,660.2 1,249.5 2,577.6 2.02 29.58

12/04 18,594.0 3,200.7 1,201.0 2,277.5 1.79 28.84

12/03 17,140.5 2,346.4 1,148.2 1,508.2 1.18 35.72

12/02 15,405.7 1,662.1 1,050.8 992.1 0.77 40.31

12/01 14,870.0 2,329.7 1,086.3 1,636.6 1.25 29.75

12/00 14,243.0 2,882.3 1,010.7 1,977.3 1.46 31.4

Balance Sheet - 10 Year Summary (in Millions)  Current Assets Current Liabilities Long Term Debt Shares Outstanding

12/09 30,224.9 16,191.0 10,560.3 1.1 Bil

12/08 28,461.5 15,078.9 10,186.0 1.1 Bil

12/07 29,391.7 14,111.9 7,310.0 1.2 Bil

12/06 28,974.5 13,516.2 8,389.9 1.2 Bil

12/05 29,988.8 14,842.7 8,934.3 1.3 Bil

12/04 27,837.5 13,636.0 8,357.3 1.3 Bil

12/03 25,838.0 13,856.1 9,342.5 1.3 Bil

12/02 23,970.5 13,689.6 9,703.6 1.3 Bil

12/01 22,534.5 13,046.1 8,555.5 1.3 Bil

12/00 21,683.5 12,479.1 7,843.9 1.3 Bil

SNAPSHOT OF MC DONALD’S CORPORTION:

Quick Quote

Latest price 70.88

Change +0.30

% Change +0.43%

Previous Close 70.58

Day's Low 70.13

Day's High 70.96

Volume1,064,32

8

Stock Scouter Rating 9

ADVANCED CHARTS:INTRADAY 1YEAR 3

YEAR:

COMPANY REPORT:

Industry : Restaurants

Employees : 385,000

Exchange : NYSE

McDonald’s Corporation franchises and operates McDonald’s restaurants in the food service industry .These restaurants serve a varied, yet limited, value-priced menu in more than 100 countries worldwide. All restaurants are operated either by the Company or by franchisees, including conventional franchisees under franchise arrangements, and foreign-affiliated markets and developmental licensees under license agreements. Independently-owned and operated distribution centers , approved by the Company, distribute products and supplies to most McDonald’s restaurants. In addition, restaurant personnel are trained in the storage, handling and preparation of products and in the delivery of customer service. In February 2009, the Company sold its interest in Redbox Automated Retail, LLC.

Financial Highlights

Sales23.28

Bil

Income 4.66 Bil

Revenue/Share 21.18

Earnings/Share 4.24

Book 13.12

Net Profit Margin

20.03%

Return on Equity

34.79%

Debt/Equity Ratio

0.74

Value/Share

Dividend Rate 2.20

Payout Ratio49.00

%

Revenue - Quarterly Results (in Millions)

 FY

(12/10)FY

(12/09)FY

(12/08)

1st Qtr 5,610.1 5,077.4 5,614.8

2nd Qtr

NA 5,647.2 6,075.3

3rd Qtr NA 6,046.7 6,267.3

4th Qtr NA 5,973.4 5,565.0

Total 5,610.1 22,744.7 23,522.4

Earnings Per Share - Quarterly Results

 FY

(12/10)FY

(12/09)FY

(12/08)

1st Qtr $1.01 $0.88 $0.83

2nd Qtr

NA $1.00 $1.05

3rd Qtr NA $1.16 $1.07

4th Qtr NA $1.13 $0.90

Total $1.01 $4.17 $3.85

Qtr. over Qtr. EPS Growth Rate

FY (12/10) FY (12/09)FY

(12/08)

1st Qtr -11% -2% ---

2nd Qtr NA 14% 27%

3rd Qtr NA 16% 2%

4th Qtr NA -3% -16%

Yr. over Yr. EPS Growth Rate

FY (12/10) FY (12/09)

1st Qtr 15% 6%

2nd Qtr NA -5%

3rd Qtr NA 8%

Qt 4th Qtr NA 26%