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External and Internal Environment of McDonald

University: University of Chester

  • Unit No: 3
  • Level: Undergraduate/College
  • Pages: 9 / Words 2197
  • Paper Type: Assignment
  • Course Code:
  • Downloads: 129
Organization Selected : McDonald

INTRODUCTION

Strategic management is the management of an enterprise resource in terms to achieve the goals and objectives of the entity (Litman, 2018). Thus, it involves setting objectives, analyzing the competitive environment, evaluating strategies, and analysis of internal enterprise and various engagement roles so that things can be done in an effective manner. In this, it is essential to formulate and implement the strategies there is also a need to take initiatives in terms to introduce corrective measures. The present report is based on McDonald's, which is the largest food chain and provides attractive services to the customer by providing quality products. The present report will look over upon things as are strategic analysis of both external and internal environments and possible strategic choices for McDonald's.

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Background and strategic information on McDonald's

The McDonald's is world largest Fast food chain and it is one of world leading firm and has restaurants in more than 100 countries. In order to enhance it brand image, this firm provides the quality food to its customers. Thus, they use to take number of modifications in the products so it will attract the more buyers. The strategic information of McDonald is that this firm has adopted generic strategy and it also helps to determine the basic approach to bring development in the enterprise and to have competitive advantage (Gassmann and et.al., 2018). This will helps to bring systematic operation of the organisational activities. With help of effective strategy formulation, it is possible to maximise the revenue of the enterprise.

External and fast food industry analysis in the UK

The Pestle analysis is helpful framework in order to determine the external environment of the enterprise. With help of it, firm can able to perform its function effectively. This is defined in below presented manner as are-

  1. Political- The functions of McDonald's is operating its business in more than 100 countries. This industry has also been complied with the number of the health and hygiene regulations. There are some legal authorities that are pressuring over the fast food industry and this industry seen as junk food. The government policies towards issues such as trade or public health can increase the cost or impact the operation of the organisation.
  2. Economic- There are number of factors as are international, national and local condition due to it being a global brand. The Quoted firm should also be aware about the terms as global supply and currencies exchanges. In this, it can be said that to cope with the fall of selling the firm need to take intransitives in terms to attributable to changing taste and increase competition in the industry (Meyer & Xin, 2018).
  3. Socio culture- In this, it can be said that the changing taste of customer has also highly impacted over the profitability of the enterprise. To have changes in customer demographic means the firm need to take innovating initiatives in terms to meet out the need and demand of the customers. In terms to have long term sustainability and to enhance sales there is need to inclusion of low fat products.
  4. Technological- with the advent of technological advancement, the enterprise is able to improve its business process. It is assistive in terms to improvise the business relation with the customers. With help using of effective social media strategies the firm is able to engage with the customers.
  5. Environmental- The environmental issues also barricades the future growth of the enterprise. There are number of the environmental issues are being faced in terms to issues in food production and deforestation and food miles (Bryson, 2018).
  6. Legal- Higher level of rules and regulation are impacting the growth of the enterprise in the huge context. There are number of issues as are minimum wages, holiday, sick pay, rate of pay and other benefits are need to be considered.

Three competitors analysis on for McDonald's

The competitor analysis will be conducted in the following manner as are-

Porter's five forces

McDonald

KFC

Burger king

Competitive rivalry

The fast Food restaurants is one of the most competitive enterprise in the present scenario. The competitors of Mcdonald's are other fast food restaurants as Burger king, KFC etc. the each firm is taking initiatives in terms to spend on advertising and continue open of new franchise to enhance the potential customers. In addition to this, enhancement in the number of the competitors has made Mcdonald's the effective and strong force.

In this, KFC is also facing intense competition and the main competitor of this enterprise is In order to attract the customer KFC offers membership card to the kids. With help of it this firm is able to attract the customer in the market. McDonald's. Thus, the competitive rivalries of the KFC is intense.

The enterprise as Burger King compete with major firms as Mcdonald's and Windy's. It consider the variety of firm in terms of types of products, market focus and other characteristics.

The threat of new entrants-

There are number of issues in terms to enter into the new market. Thus, to enter the McDonald in the glob requires the massive capital investment and time and it also helpful in order to create the awareness among the market. In addition to this, it also can be said that it requires the effective marketing to attract the customers (Greer, 2018).

The fast food industry requires the number of investment at time of taking entry into the new market. In addition to this, it can be said that KFC and McDonald's has it brand image so strong.

The burger king provides its customer the effective service at the lower price. In order to take the entry into market this entity is also requires huge investment.

Bargaining power of suppliers-

In this, number of suppliers are there who wishes to be part of Mcdonald's and want to render them services. Furthermore, supplier are in no position to the bargain with the firm in order to enhance its price.

This firm has also strong brand reputation in the market. In order to run its business function effectively it is essential to have effectiev supplier and due to lack of production variation, large size of orders supplier cannot attempt to raise the prise.

The Burger is also glovbal leading brtand and provide effective services to customer. Thus, they require large number of supplier to carry out their operational ac activities in the market.

Threat of substitutes

There are number of substitutes of this enterprise as are KFC, burger king etc. Among this, most of the substitutes are competitive in terms of consumer satisfaction and quality. In this, it can be said that to compete with the substitute it is essential to provide product with the health concern.

This firm is facing competition mainly with local restaurant as Arabic Fried chicken in the middle east region. To cope up with it, KFC decided to provide free Wi- Fi services so that things can be done effectively and efficiently.

Burger king is also facing tough competition in the market. This firm has also number of rivalries in the market. In order to cope up with it, they also need to bring innovation taste of products. This will helps to enhance brand image of the enterprise.

Strategic direction option discussion

The Mcdonald's cooperation should use Ansoff Matrix growth strategies in order to give major focus over the present and potential products of the customer's. Thus, it has been defined in the following presented manner as are-

Market penetration- This strategy will be adopted at the time when the enterprise enters and penetrates the market with the existing products. In this, the one of the best way to achieve more amount of profitability is to attracting the competitors customer with providing innovative offers. This will also help to enhance market share of the enterprise (Song and et.al., 2018).

Product development- In this, it can be said that McDonald has always provided its customer the new and innovative strategy. With help of undertaking the innovation effectively the growth of the firm can be enhanced. This strategy will be assistive in terms to attracting the customer's in the market.

Market development- The quoted firm is providing its services in more than the 119 countries. It work as to produce the additional market segments on the geographical basis. With help of entering into the new market the enterprise is able to enhance its revenue.

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Diversification- The McDonald's can also introduce new products and brand in new market. This strategy is also inclusive some sort of risk. In order to attract the customer's they may also offer number of opportunities so that things can be done effectively.

Selection for one future McDonald's strategy for the UK

The revenue growth is goals of the enterprise and it is effective in terms to grab stronger position in the market. Thus, new customers, new markets, and creation of new products and doing a better job serving and this all are viable in terms to growth strategies. In addition to it, this can be defined in following manner as are-

In order to run the function effectively, the McDonald's will adopt two strategies in future that is market expansion and product expansion. With help of Market expansion the firm is able to analyse the success of the firm in market. With help of entering into the new market, it is possible to have room for growth. In this way, the firm is able to cover the number of market and it will be helpful in order to have expansion of firm and enhancement in the profitability of the enterprise. On the other hand, it can be said that product expansion will also be suitable in order enhance the operational functions of the enterprise (Hunt, 2018). In terms to add new features to the product it is possible to increase sales and profits of the enterprise. With help of this strategy, the firm is able to bring modifications and innovation in the products and services. In order to add new taste and flavours the firm can able to attract the number of customer in the market. This all kind of strategy will be helpful to attract the customers of competitive firm. Get the best teaching assistant level 2 coursework help for students in UK.

Recommendation for McDonald's /conclusion

CONCLUSION-

By summing up the above report it can be concluded that strategic management is the term that works as to focussing on long term planning and provides ultimate direction to the enterprise. In addition to it, strategic goal of the enterprise will be helpful to achieve desire aim and objectives. The present report is based on the business activities of the McDonald's and it is global leading brand. Thus, report has covered the various things as are Pestle analysis, strategic direction, Ansoff strategies and selection of future strategies so that growth of the firm can be expanded. The main aim of this report is to focus over strategic manager so that long term growth and sustainability can be enhanced.

RECOMMENDATION-

On the basis of above report, there are some following kind of recommendation and it has to be presented in the below context manner as are-

  1. The McDonald should work as to provide quality products to the customers so that the brand image of the firm can be sustained for the longer period. With help of providing services in the affordable manner will helps to maintain customer retention to firm.
  2. Quoted firm should offer discounted services and attractive offer this will be assistive in terms to grab the attention of buyers in market.
  3. The Mcdonald's should adopt modern technical advancement to provide services to customer. It can be done with help of strategic management planning and this works as to maintain long term sustainability and profitability.
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