mcd
TRANSCRIPT
STRATEGIC BUSINESS UNIT-
McDonalds
Submitted by:Shally hundal
CMBA 5
Porter Competitive Model
Intra-Industry Rivalry
Strategic Business Unit
BargainingPower
of Buyers
Bargaining Power
of Suppliers
Substitute Products
and Services
PotentialNew Entrants
RIVALRY AMONG COMPETITIVE FIRMS
• Focus on competitive advantage.• Strategies by firm.• Conditions that cause rivalry
among competing firms:High number of competing firms.Consumers switch brands easily.Rivals sell similar
products/services.
POTENTIAL ENTRY OF NEW COMPETITORS
• Barriers to entry are important.• Quality, pricing, and marketing can
overcome barriers.• New firms sometimes easy to enter
the industries because of high quality products, lower price and substantial marketing resources.
SUBSTITUTE PRODUCTS
• Refers to products in other industries.
• Its threat occurs when a products demand is affected by the price change of a substitute product.
BARGAINING POWER OF SUPPLIERS
• Suppliers are the business that supply material and other products.
• If supplier has high bargaining power company is less attractive.
BARGAINING POWER OF CONSUMERS
• Bargaining leverage• Buyer volume• Brand information• Price sensitivity
INTRODUCTION• Founded in 1948• Mr. Ray Kroc in San Bernardino,
California sold 100 millionth hamburger in 1958 and bought the rights to the McDonalds Corporation name.
• 58 million customers all age all gender per day
• Found in 119 countries.• Operates over 31000 restaurants.• Current strategy is cutting labour, food
and utility costs through implementing Technology and Innovation.
POTENTIAL NEW ENTRANTS
SUBSTITUTE PRODUCT OR
SERVICE
BARGAINING POWER OF
BUYERS
BARGAINING POWER OF SUPPLIERS
•Threat of new entrance HIGH•Regulation of limit•Easy access market and low start up cost
•Power of suppliers LOW•Industry limitations•Low quantity purchase•Less chances of switching, high brand image thru differentiation and uniqueness
•Bargaining power of suppliers LOW•Worlds largest restaurant chain in sales•Most of them owe MCD for their existence•LOW the power of suppliers-lower the cost of raw materials and HIGH competitive price
•Threat of substitutes low-moderate•Availability of MCD products•Choose MCD for eating and entertainment•Introduction of local taste products
•Threat of competition HIGH•Very competitive fast food chain•Location of outlets•Major competitor- BURGER KING and KFC
SWOT ANALYSIS Strengths
• Has a good image in the minds of consumers.
• Strong product value• Innovative in
producing new product lines.
Weaknesses
• Children as their main target audience.
• Slow drive-thru services
SWOT ANALYSIS Opportunities
• Partners with UAE government to reduce carbon footprint.
• Advertising strategy.• Have ability to add healthier
lines of food
Threats
• Changes in commodity prices.
• Emergence of other fast food.
• Competitor BURGER KING and KFC
• Heavy investments on promotional campaign
“IN BUSINESS FOR YOURSELF, BUT NOT BY
YOURSELF”