McDonalds: Supply Chain ManagementTABLE OF CONTENTSntroduction.01It starts with01Some important facts02Indian markets02Supply chain is...03Supply chain in mc donalds india04Mc donalds distribution centre.04Concepts of cold chain..05Steps involved in cold chain concept..06List of suppliers and how cold chain concept works.07Different items are sourced from.09Three logistical drivers..10Three cross functional drivers..10Pull/push process11Supply chain process.12In lucknow we are at...13Page 3 of 17

INTRODUCTIONMcDONALDS IS .McDonalds is a name which is today synonymous with the fast food. McDonald'sis a fast food chain with restaurants all over the world with headquarters in oakbrooks, Illinois, US. It serves burgers and other fast food customized to localtastes. Its philosophy has been 'one world, one burger;' which meant that theburger ated supply chain, calledthe 'Cold Chain'.IT STARTS WITH.In 1954, Ray Kroc, 52, distributor of milk shake maker- multimixer, went tosee Mcdonalds brothers hamburger stall in California.With an opportunity, he thought to open several of such restaurants so asto sell his multimixer milk shake machine.Page 4 of 17

T STARTS WITH.In 1954, Ray Kroc, 52, distributor of milk shake maker- multimixer, went tosee Mcdonalds brothers hamburger stall in California.With an opportunity, he thought to open several of such restaurants so asto sell his multimixer milk shake machine.SOME IMPORTANT FACTSIn year 2004, mcdonalds was the largest marketer of fast food in theworld.31000+ restaurants.47 million customers served daily.1999- 8thmost valueable brand.2000- ranked amoung top 100 firms in the world.INDIAN MARKETIts a huge sub-continent.India is 4 times more populated than the US.India has 300 million strong middle class people.India is one of the largest economy.Incorporated in 1993, MIPL is Mcdonalds indias wholly ownedsubsidery.In India, Mcdonalds open its first restaurant in vasant vihar, South Delhi.50:50joint venturewith-(1) North- Connaught plaza restaurants( owned by Mr. Vikram Bakshi)and(2) West- Hardcastle restaurants ( owned by Mr. Amit Jatia).World map showing the presence of McDonalds and the year when itstarted. In India it started in year 1996.Page 5 of 17

McDonalds: Supply Chain Managementvegetables to 2C within 90 minutes. Then a large cold room (a refrigerated van)was used for transportation to the distribution centers. In the van, thetemperatureandrelativehumidityofcropwasmaintainedat1-4Cand95per cent, respectively and the flavors and freshness are lockedAt the suppliers' level, care was taken to guard against any possiblecontamination or interruption in the cold chain that can break the link and have adetrimental effect on the quality of our product.The iceberg lettuce from Ooty, mutton patties from Hyderabad and sesame seedbuns from Punjab were all delivered to Radhakrishna Foodland Private Limited(RFPL) distribution centre (cold storage) in its refrigerated vans. RFPL stored theproducts in controlled conditions in Mumbai and New Delhi and supplied them toMcDonald's outlets on a daily basis.By transporting the semi-finished products at a particular temperature, the coldchain ensured freshness and adequate moisture content of the food. Thespecially designed trucks maintained the temperature in the storage chamberthroughout the journey. Drivers were instructed specifically not to switch off thechilling system to save electricity, even in the event of traffic jam.LIST OF SUPPLIERS AND THE DISCRIPTION SHOWING HOWCOLD CHIN CONCEPT WORKS AND CONTRIBUTE TOWARDSEFFICIENCY.Dynamix dairy industry (cheese)Trikaya agriculture (iceburg lettuce)Vista processed food pvt ltd. (chicken and veg range of products)Page 9 of 17

McDonalds: Supply Chain ManagementTRIKAYA AGRICULTURE (SUPPLYING ICEBURG LETTUCEAdvanced agricultural practices helps them to grow speciality crops likelettuce and herbs.Pre cooling room and large cold room for post harvest.Refrigerated transportation.VISTA PROCESSED FOOD PVT. LTD. (FORSUPPLYING FROZENCHICKEN AND VEG PRODUCTS)For chicken, temperature maintained is -35 degrees Celsius.Refrigerated transportation.RADHA KRISHNA FOODLAND (DISTRIBUTION CENTRE)Specialized in handling large volumes.Activities involved are procurement, quality inspection, storage, inventorymanagement, deliveries, data collection, recording and reporting.One stop shop for all distribution management services.Both dry and cold storage facility.AMRIT FOODSAn ISO 9000 firmSupplies long life UHT milk/ milk products for desserts.DIFFERENT ITEMS ARE SOURCED FROMDIFEERENTGEOGRAPHY IN INDIA..Page 11 of 17

Facilities- they are the actual physical location in the supply chain networkwhere the product is stored, assembled, or fabricated. The two mainfacilities are production sites and the storage sites.In McDonalds, because the products are perishable, storage time wasminimal so as to reduce the wastage.2.Transportation- it is the process where the inventory is moving from placeto place. Refrigerated vans are used here in this case.3.Inventory- it includes rawmaterials, work inprogress, and finished goodswithin a supply chain.THREE CROSS-FUNCTIONAL DRIVERS1.sourcing- who will perform which activity( production, storage,transportation, and distribution) in a supply chain.This activity was taken care by mcdonalds corporation.2.information- it includes data and analysis related to facilities, inventory,transportation, cost, prices and customers in the whole supply chain.This activity was done by Radhakrishana food land that acts as theirdistribution centre.3.pricing- how much a firm could charge for a particular goods and servicesthat it makes available in the supply chain.Here it was done by the mcdonalds only.PULL/PUSH PROCESSPage 13 of 17THREE CROSS-FUNCTIONAL DRIVERS1.sourcing- who will perform which activity( production, storage,transportation, and distribution) in a supply chain.This activity was taken care by mcdonalds corporation.2.information- it includes data and analysis related to facilities, inventory,transportation, cost, prices and customers in the whole supply chain.This activity was done by Radhakrishana food land that acts as theirdistribution centre.3.pricing- how much a firm could charge for a particular goods and servicesthat it makes available in the supply chain.Here it was done by the mcdonalds only.PULL/PUSH PROCESSPage 13 of 17

McDonalds: Supply Chain ManagementPull processes are initiated by a customer order while the push processes areinitiated by the anticipation of customer order.Mcdonalds use both pull as well as push process, to a certain extent push iscreated and after that level the pull created by the firm did its task. One importantquestion can be asked to what level that push can be applied.The products willbe pushed to the restaurants where the customers automatically demand thatproduct and hence a pull is created.Fig. showing the boundry of pull and push, push last till the product reaches therestaurant and pull starts when a customer orders the product.SUPPLY CHAIN PROCESS CYCLE..The processes in the supply chain are divided into a series of cycles, eachperformed at the interface between 2 successive stages of supply chainPage 14 of 17Various Suppliers supplies the materialsProducts delivered to Distribution centresProducts delivered to restaurantCustomer order at restaurant,Push stops ,pull starts here

McDonalds: Supply Chain ManagementPage 15 of 17customersRetailer/ McDonalds restaurantsdistributorsuppliersCustomer order cycleReplenishment cycleProcurement cycle

Activity(218)FILTERSPULL/PUSH PROCESSPull processes are initiated by a customer order while the push processes areinitiated by the anticipation of customer order.Mcdonalds use both pull as well as push process, to a certain extent push iscreated and after that level the pull created by the firm did its task. One importantquestion can be asked to what level that push can be applied.The products willbe pushed to the restaurants where the customers automatically demand thatproduct and hence a pull is created.Fig. showing the boundry of pull and push, push last till the product reaches therestaurant and pull starts when a customer orders the product.SUPPLY CHAIN PROCESS CYCLE..The processes in the supply chain are divided into a series of cycles, eachperformed at the interface between 2 successive stages of supply chainPage 14 of 17Various Suppliers supplies the materialsProducts delivered to Distribution centresProducts delivered to restaurantCustomer order at restaurant,Push stops ,pull starts here