Mcdonalds Final

PROJECT ON SUPPLY CHAIN MANAGEMENT Perishable Products (Restaurant Chain)

Group Members Nikhil Jadhav (8126) Asif Shaikh (8150 ) Pooja Shetty (8153) Sunil Singh (8155) Imran Khan (8185) Ashwin Kodati (8187)

OBJECTIVE : Understand the markets basic requirements of the product. Market potential of the product Competitive environment of the chosen product market dynamics in terms of consumer behavior about the product Detail information on the Supply Chain Mfg locations in India How product reaches to consumer? Criticality/significance of the Supply chain Who are all intermediate in between of Mfg to final consumer e.g dealer, C&F agent, depot etc Describe role of each intermediate in the supply chain Understand the markets basic requirements of the product. Market potential of the product Competitive environment of the chosen product Market dynamics in terms of consumer behavior about the product Detail information on the Supply Chain Mfg locations in India How product reaches to consumer? Criticality/significance of the Supply chain Who are all intermediate in between of Mfg to final consumer e.g dealer, C&F agent, depot etc Describe role of each intermediate in the supply chain

McDonald’s Vision, Mission and Value

Quick Facts About McDonald’s • McDonald's was started as a drive-in restaurant by two brothers, Richard and Maurice McDonald in California,US in the year 1937. • By mid-1950s, the restaurant's revenues had reached $350,000. • Ray Kroc , distributor for milkshake machines, expressed interest in the business, and he finalized a deal for franchising with the McDonald brothers in 1954. • He established a franchising company, the McDonald System Inc. and appointed franchisees. • In 1961, he bought out the McDonald brothers' share for $2.7 million and changed the name of the company to McDonald's Corporation . In 1965, McDonald's went public…

McDonald's In India 1996 - First restaurant opens in India, at Basant Lok,Vasant Vihar, New Delhi. McDonald's India is a 50 – 50 JV partnership between McDonald’s Corporation (U.S.A) and two Indian businessman Amit Jatia (Hardcastle Restaurants Private Limited, Mumbai)and Vikram Bakshi (Connaught Plaza Restaurants Private Limited, Delhi). Two separate operations in Northern & Western India. Partners and their management teams trained extensively in Indonesia & the U.S. Approximately 75% of the menu available in McDonald’s in India is Indianized and specifically designed to woo Indian customers. The McDonald's philosophy of QSC&V is the guiding force behind its service to the customers.

Market potential of the McDonald’s

McDonalds has built up huge brand equity. It is the No. 1 fast-food company by sales, with more than 31,000 restaurants serving burgers and fries in almost 120 countries. Sales, 2007 (11,4009 million), 5.6% sales growth Joint ventures with retailers (e.g. supermarkets). Consolidation of retailers likely, so better locations for franchisees. Respond to social changes - by innovation within healthier lifestyle foods. Its move into hot baguettes and healthier snacks (fruit) has supported its new positioning. Use of CRM, database marketing to more accurately market to its consumer target groups. It could identify likely customers (based on modeling and profiles of shoppers) and prevent brand switching. Strengthen its value proposition and offering, to encourage customers who visit coffee shops into McDonalds. The new “formats”, McCafe, having Wifi internet links should help in attracting segments. Also installing children’s play-parks and its focus on educating consumers about health, fitness. Continued focus on corporate social responsibility, reducing the impact on the environment and community linkages. International expansion into emerging markets of China and India.

Competitive environment of the Restaurant Chain (MCD)

McDonald’s India: Channel Network

McDonald’s India: Network & competitors

How product reaches to consumer? Criticality/significance of the Supply chain

Geographically Diverse suppliers: Ensuring stringent quality standards

Supplier performance index Import Breath of supply process control equipment No direct control over issues, positive influence by raising questions, bringing people to the table and encouraging improvement The McDonald’s Supply Chain

VALUE CHAIN ANALYSIS OF MCDONALD’S

Inbound Logistics Organizing the supply of food and materials to restaurants through approved third party logistics operators. Production in huge plants denoted exclusive to McDonald’s control food distribution and packaging system Inbound logistics

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Service Relatively Few Management Layers to Reduce Overhead Effective Training Programs to Improve Worker Efficiency and Effectiveness Timing of Asset Purchases Efficient Plant Scale to Minimize Manufacturing Costs Selection of Low Cost Transport Carriers Delivery Schedule that Reduces Costs Products Priced to Generate Sales Volume Small, Highly Trained Sales Force Investments in Technology in order to Reduce Costs Associated with Manufacturing Processes Frequent Evaluation Processes to Monitor Suppliers’ Performances Policy Choice of Plant Technology Organizational Learning Efficient Order Sizes Operations R&D in field research needs of end users. quality development in collaboration with good suppliers Forward integration: through franchisees with control over store presentation, menu items etc. and enhance participation in process improvement Operations

Technological Development Human Resource Management Firm Infrastructure Procurement Outbound Logistics Marketing & Sales Service Selection of Low Cost Transport Carriers Delivery Schedule that Reduces Costs National Scale Advertising Products Priced to Generate Sales Volume Small, Highly Trained Sales Force Effective Product Installations to Reduce Frequency and Severity of Recalls Frequent Evaluation Processes to Monitor Suppliers’ Performances Efficient Order Sizes Interrelationships with Sister Units Outbound Logistics Is the concern of the franchisee. Outbound logistics are growing as a part of McDonald’s recycling system integrating in the logistics of distribution center Outbound logistics

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales Service MARGIN Marketing & Sales Long term marketing objectives are broken down into shorter term measurable targets, which McDonald uses as milestones. Country teams are given autonomy in marketing mix decision. Advertising & PR is outsourced (Mudra agency in India) Marketing

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales Service Service Services provided by the companies enrollment standards Service

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales Service Procurement Sought partners with expertise on down trade distribution Procurement

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales Service Technological Development Technology and development research in quality assurance, and packing readdressed at lower cost, faster delivery chain system and process control equipments, recycling system. R & D

Technological Development Human Resource Management Firm Infrastructure Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales Service Human Resource Management HRM specialists in R&D and expertise in food formulation, education to raise awareness of issues and raise demand. The addressing environmental issues and CRS. HRM

Support Activities Technological Development Human Resource Management Firm Infrastructure Inbound Logistics Operations Outbound Logistics Marketing & Sales Service Firm Infrastructure Strong real estate portfolio. International organization more than 50000 employees works in more than 50 countries, INFRASTRUCTURE

Who are all intermediate in between of Mfg to final consumer. Describe role of each intermediate in the supply chain

Vital links of Mc Donald’s cold chain. McDonald's spent a few years setting up a unique Cold Chain. The Cold Chain is necessary to maintain the integrity of food products and retain their freshness and nutritional value. Procurement warehousing Transportation Retailing of food product

SUPPLIERS Trikaya Agriculture Supplier of Iceberg Lettuce Vista Processed Foods Pvt. Ltd. Supplier of Chicken and Vegetable range of products (including Fruit Pies) Dynamix Diary Supplier of Cheese Amrit Food Supplier of long life UHT Milk and Milk Products for Frozen Desserts

Distribution Radhakrishna Foodland Distribution Centres and cold storages. • Completely dedicated distribution and supply chain. • Matching supplier production with deliveries using ERP. • Quality inspection Program, quality check at 20 different points in supply chain. • HACCP(Hazard analysis critical control points) food safety standards emphasizing prevention of faults.

The five main performance objectives are: • Speed • Cost • Quality • Dependability • Flexibility

Mcdonalds Final

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