JAIPURIA INSTITUTE OF MANAGEMENT

LUCKNOW-226010

Micro And Macro Environment Of

Mcdonalds
McDonald's is an American fastfood restaurant chain founded in 1940 as a barbeque reataurant
operated by Richard and Maurice. It has a worth value of 18 billion dollar. It is based in Oak
Brook, Illinios, Mc Donalds confirmed plan to move its global headquarters in Chicago b early
2018.

ENVIRONMENTAL FACTORS OF McDonald's

Environmental influence on companies global business platform. As area like political,social

economical, environmental and economical are sensitive and critical thats why , thise must be
addressed appropriately for companies success .meanwhile strategy is really important for
company because it is a direction and scope of company for the long period .
The environmental factors which are under micro and macro environment, whether directly or
indirectly impacting the company. Presently Mcdonalds is using lots of strategy which got
positive and negavtive effects on company. Mcdonald must keep effective and efficient strategy
to cope up with the failure strategy.

SWOT Analysis of McDonalds

INTERNAL ENVIRONMENT

Strengths
STRONG BRAND VALUE: McDonalds has one of the most recognizable brands in the
world.The company provides consistency in its food, so that you can get the same taste
whether youre eating a Big Mac
CULTURAL DIVERSITY : It offers food according to the location of the restaurant, thereby
increasing the sales in that particular region. Because of this it has the largest food chain
in the world.
DIVERSIFIED INCOME: Since the organization is so large, with so many location around
the world its total revenue in different areas tends to offset one another..

Weaknesses

NEGATIVE PUBLICITY: Mcdonalds has always maintained the perception that its food is
quite unhealthy , loaded with fat, carbs, salt and sugar. Well these perception are
generally on point as most item on its standard menu are relatively unhealthy. The chain

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has been widely criticize for promotiong unhealthy eating habits, taking ahead many of
its consumers to put on pounds.
HIGH EMPLOYEE TURNOVER: Most likely the jobs at Mcdonalds are low skilled and low
pay due to that as a result there is a singnificant amount of turnover. Some the emloyess
dont stay for a long period in the organization because of these factors mentioned above.

EXTERNAL ENVIRONMENT

Opportunities
UPGRADED MENU: The company is also trying to strengthen its position,In the high-
margined caffeine beverages industry. Mc caf which is its own Subsidiary has some
success by keeping prices very competitive. Now the Mc Caf includes fruits smoothies,
an appeal to more healthy consumers.
EXPANSION PLANS: McDonalds always try to expand its market share by introducing and
launching very effective and healthy products in the market so that more and more
consumers attract towards it.

Threats
Its competitors are working such as KFC, Burger King, Subway, Pizza Hut, etc for the same
population of the customers.

Fast food companies are criticized due to unhealthy food.

Variation of foreign currency effect its operation.
Because of low pricing competition is highly increasing.

MICRO AND MACRO ENVIRONMENT

Definition of Micro Environment

Microenvironment refers to the environment which is in direct contact with the business and can
directly effect routine activities it is associated with the small area in which the firms functions.

It is the collection of all the forces that are close to the firm, they influence the performance and
day to day operations of the company. It includes suppliers, competitors, marketing
intermediaries, cutomers and firm itself.

FACTORS OF MICRO ENVIRONMENT

1. Company- McDonalds is having most delicate and most costly outlets, e.g. airport
shopping mall.

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2. Suppliers- Suppliers helps in delivering food to the customers, therefore McDonald must
watch on supply and cost. So that the consumers are sastisfied.
3. Marketing Intermediaries- As the Big Organization of fast food retail chain is the
hospitality sector that is the reason Tour Operator, Hotel, are not required for promotional
event for promotional activity. The activity is done itself by the company.

4. Competitors- McDonalds main competitor are Hardees, Wendys, Burger king.

McDonalds always ready to treat competitors carefully.

5. Publics- Mc Donald work with the power and importance of many groups like media.

6. Customers- Consumers are main factors of McDonalds . It serves almost 54 bilion

customers daily because of the reason there are young generation company is very
peculiar about their choices, this is the reason the demand and choice are impacting
McDonalds.

Definition of Macro Environment

The general environment within the economy that influences the working, performance, decision
making and strategy of all business groups at the same time is known as Macro Environment. It
is dynamic in nature. Therefore it keeps on changing.

It constitutes those outside forces that are not under the control of the firm but have a powerful
impact on the firms functioning. It consists of individuals, groups, organizations, agencies and
others with which the firm deals during the course of its business.

TYPES OF MACRO ENVIRONMENT

1. Demographic The demographic of McDonald refers to the level of population growth,
age, gender, education patterns, family influences etc.

2. Economic- Ecnomical factors are very essential to business organization for e.g due to
international businesss operation Mc Donald faces different slabs of tax and
differentmonetary value in different countries. It also faces the difficulty in global food
distribution.

3. Natural- McDonald is rapidly increasing the number of restaurant. The main source of
ingredient and packaging is nature. McDonald's has a Rain Forest Policy, which declares its
commitment to beef purchasing practices that do not contribute to tropical de-forestation.
Everyday McDonalds using a huge amount of napkins, carryout bag, tray lines, clamshells. Oil
and water is other major ingredient using in McDonalds. . The continuous and enormous use of
natural resources can disturb the balance in the ecosystem.

In Europe, McDonald's has been recycling vegetable grease by converting it to fuel for
their diesel trucks Now, everybody are conscious about environment. So, McDonalds

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need to careful about environment that, what McDonalds are doing that's environmental
friendly.
4. Technological- McDonalds is producing their main product that means burger, salads in
their own kitchen space, they are cooking fries , nuggets and meat patties in their own
grill machine.So, the use of equipment, special control devices, temperature regulators,
point-of-sales systems, inventory upkeep, financial information and communications are
all linked to different technologies. In this way technology is impacting McDonalds.

5. Political & Social factors - The business operation of an firm is always effecting by the
policies of state and its government. McDonald's business is also under the control of
government rules and regulations. The main issue of controlling food business is health
and other issues are license, employee laws, tax issues etc. McDonald's follows the local
government's policies as well as foreign investment policies on its franchise business
strategy. Political instability of local state is also affects McDonald's business.

The life style of people is being changed and the demand of this change affects
McDonald's. The people of this modern urban society expect the highest level of service
and all the latest facilities from a hospitality organisation. In addition, this changing
demand is different in society to society and country to country. For example, in India,
Hindu people prefer vegetable, Muslim people avoid pork. To fulfil the customers'
expectation, McDonald's needs to research the market and also needs to provide effective
food menu.

6. Cultural- McDonalds is doing business worldwide. So, different regions customers got
different culture and religion. McDonalds need to think about, cultural and religion rules
and tradition. For example, in India, the non-vegetarian menu includes chicken and fish
items only. Beef is not on the menu in India because are considered sacred. Like that, in
Muslim McDonald's introduced halal meat for burger.

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