The Nature of Products Done by McDonalds - Case Study Example

McDonald Company Institution Name Date McDonald’s Corporation Growth to an International Company Introduction McDonald’s is the largest fast food company in the world whose specialty is in the production and sale of hamburgers although over the years, more products have cropped up. The company was initially confined to the United States but today it is a global company spreading its wings as far as the Middle East where cultural religion has had a major setback in establishing alternative forms of fast foods due to cultural differences. This essay will also evaluate key competitors internationally as well as how McDonald’s has managed to remain at the top of the game despite stiff challenges met in the international market. Discussion McDonald’s Corporation in the United States McDonald’s was initially a hamburger producer and distributor when it was founded by two brothers in the 1940s. However, over the years the firm changed ownership and its variety of products also diversified to include snacks such as French fries, chicken, soft drinks and smoothies. Mostly the services at McDonald’s are sold over the counter to be consumed elsewhere but of late they have tried to establish seating areas where customers can relax as they enjoy delicacies from the firm (Derdak and Pederson, 2004). Some of the reason behind the successful growth of McDonald’s in the United States could be attributed to diversification in the line of business such that McDonald’s does not only offer fast foods, but also playgrounds allover the country. These playgrounds offer excellent sites to establish McDonald’s fast food restaurants so that as children play, they get to enjoy their favorite snacks conveniently. The other aspect that has contributed to the success could be variety of ingredients used to prepare the sandwiches among other stocked foods. For instance there are vegetarian sandwiches as well as those specifically made for non-vegetarians. Consequently, all preferences are considered and clients are never disappointed while they do not have to worry about infringement of rights (Smith, 2007). Locally McDonald’s Corporation has been a subject of several heated debates such as increased obesity levels among Americans which is attributed to increased consumption of fast foods. Consequently, the corporate ethics at McDonald’s have been questioned based on the elevated advertisements with juicy snacks which have led to more people succumbing to purchasing foods full of harmful calories. However, these are minor challenges which have not limited expansion of the fast food chain (Carrigan and Pelsmacker, 2009). McDonald’s Corporation internationally When it first opened its doors, McDonald’s had its target market in the United States but increased globalization and demand of its high quality products lead to penetration into international markets where warm reception has been accorded worldwide. Today the company operates franchises in more than 119 countries and serves up to 60million customer everyday. Consequently, McDonald’s is a major employer with over 2 million employee’s permanent and casual laborers (Smith, 2007). McDonald’s faces stiff competition locally and internationally from other fast food restaurants such as Burger King which specializes in the same snack as McDonald’s that is burgers. Consequently, the two rivals have similar other products which have made them compete for the same customers in all dimensions. However, McDonald’s has been able to edge Burger King out of its way by opening single branches in more countries while Burger King opens multiple branches in the same country. This has made Burger King a household brand in some countries while McDonald’s boasts of being a household name globally (Terry & Forrest, 2008). Wendy’s is yet another major rival in the fast food market and it has given McDonald’s a run for its money as it utilizes fresh meat in its sandwiches or burgers unlike the frozen pieces used by the other two competitors (Zuckerman, 1985). However, McDonald’s has managed to outdo Wendy’s as most of its products have customized brand names for instance McDonald’s sandwiches are branded Big Macs hence enhancing their presence in the market. Other signature products include McRice and McRibs which make McDonald’s products to stand out in a selection store. The other feature that has enabled McDonald’s to maintain its market share is through establishment of catchy slogans which are easy to identify with as well as developing logos that are unique. As a multinational, McDonald’s has been able to advertise its products in all countries where its stores are present. Consequently, the fact the brand name is used on a number of ventures by the corporation makes it easier for first time customers to remember it henceforth. Similarly, employees at McDonald’s are diverse as they are recruited from native countries hence making it easier for them to sell the McDonald’s products to their own people. This attributes have given McDonald’s an opportunity to adapt to several cultures around the world as failure to meet the cultural expectations of the customers may hinder growth of the business in such regions (Derdak, 2004). Cultural adaptation of McDonald’s Corporation internationally The Middle East is inhabited by people of Islamic or Arab origin whose religious and cultural practices are different from those of other religions. Consequently, the nature of products or marketing done by McDonald’s in the United States or other European countries is very different from that conducted in the Middle East. It is apparent that over the years, Muslims and Americans have held a long time feud which would be worsened by failure of McDonald’s to meet the requirements of these people according to their culture (Gannon, 2004). A number of problems are likely to arise if the cultural requirements are not met by McDonald’s in the Middle East. For instance, McDonald’s risks being banned from establishing its franchise in the Middle East region. Similarly, poor or no sales will be recorded as Islamist leaders have a way of revolutionizing followers against making purchases from the food store. The other risk posed could be prohibition against setting up McDonald’s establishments near the Middle East on ethical grounds. This would in turn elicit terrorism attacks against the parent country of McDonald’s which is the United States. Therefore, McDonald’s had to comply with all set ethics and religious practices in the Middle East before setting shop there (Gannon, 2004). One of the setbacks or cultural shock that was witnessed include providing an alternative to pork hamburgers as Muslim and Arab faithful do not consume pork. This was replaced with beef and chicken hence custom made to meet the cultural needs of consumers in the Middle East (Gannon, 2004). McDonald’s also had to develop specially prepared burgers for its clientele in Indonesia where beef is prohibited. This was made possible by use of pork and chicken instead of beef. It is also vital to note that Indonesians would rather buy sandwiches filled with food they are familiar with such as rice than filings from other parts of the world. Similarly, the corporation has had to develop snacks suited for strict vegetarians especially those practicing to Hinduism and Buddhism. However, at some point, McDonald’s distributed French fries that were laced with beef broth and this resulted into a legal suit (Carrigan, 2009). McDonald’s also faced cultural challenges in France due to the increased levels of obesity in the country. Over the years, the French government has always advocated for healthy living where consumption of a balanced diet has always been regarded highly. However, upon introduction of McDonald’s fast food restaurant, a lot of questions were raised on the ethics employed in McDonald’s advertising. This is because most of the advertising by McDonald’s targets children who are victims of obesity. Similarly, McDonald’s also distributes toys to children which are accompanied by fast foods hence going against the French culture of healthy eating (Katz, 2010). Conclusion McDonald’s Corporation has not only spread its wings all over the United States but also around the world to attain a multinational status. However, this fete has not been smooth as challenges were present in each step but McDonald’s being a firm run by competent managers has overcome the setbacks and barriers to get to where it is today. Similarly, competitors have being sources of opportunities for McDonald’s to enhance its services hence allowing it to maintain its position in the market. In conclusion, although McDonald’s has been through a lot of cultural shocks in different corners of the world, it has emerged successfully in the international scene. References Carrigan, Marylyn & De Pelsmacker, Patrick (2009). Will ethical consumers sustain their values in the global credit crunch? International Marketing Review, 26(6), pp. 674–687,(p.7) Derdak T. & Pederson Jay P., ed (2004). "McDonald's". International directory of company histories. 67 (3rd ed.). St. James Press Gannon, M. J., (2004), Understanding Global Culture: Metaphorical Journeys Through 28 Nations, 3rd Edition, (Thousand Oaks, CA: Sage Publications Katz, Neil (2010). "McDonald's and Toy Lawsuit: Are "Happy Meals" Tricking Kids?". CBS News. Retrieved on December 8, 2011 from: www.cbsnews.com/8301- 504763 Smith, A. F. (2007). The Oxford companion to American food and drink. Oxford University Press Terry, A & Forrest, H. (2008). "Where's the Beef? Why Burger King Is Hungry Jack's in Australia and Other Complications in Building a Global Franchise Brand". Northwestern Journal of International Law and Business, 2008 28 (2): pp. 171– 214 Zuckerman, D., (1985). "Wendy's enters breakfast arena; chain faces fierce competition". Nation's Restaurant News. Read More