Burger king swot analysis 2017

Institution

McDonald’s Corporation commonly referred to as McDonald is one of the most successful companies dealing with fast-food chain distribution globally with most of its able and functional SWOT analysis depending on continued domination of fast-food competitive advantage. The SWOT analysis determines the operates on identification of the company’s strengths, weaknesses, opportunities and threats that affects the operations and functions of the company in different ways. The restaurants operate under franchise merchants to deliver quality food and beverages to the customers globally. The McDonald’s systems basically operate on basis of franchise restaurants and Company owned restaurants. The franchise operations enable the McDonald’s to control marketing and pricing globally in form of decision making to benefit the company (McDONALD, 2016). The franchising also helps in strengthening the global products in terms of resource financing and operations. McDonald’s operations ensure consistency and rigorous standards that are met to satisfy customers globally in terms of quality and creation of proper business relationships.

Strengths

The McDonald’s Corporation enjoys being the second largest restaurant globally in terms of food chain (food and beverages) and it operates in more than 120 countries across the globe. It has a total of more that 37, 241 restaurants globally that meets with its large networking in the world. It competes with other large restaurants such as the Subway, KFC and the Starbucks. The McDonald’s enjoys increased sales in terms of food chain distribution which ensures that the company operates in a better network that is advantageous over most of its competitors. Another strength of the McDonald’s is its economies of scale which allows the company to share most of its fixed costs with almost all of the restaurants that is affordable to the customers. It also enjoys a huge gain in terms of implementing best exercises through better methods of performing tasks and managing them.

The best practices implemented by the McDonald’s ensures vast networking of restaurants. McDonald’s also enjoys some market power and domination over its competitors and suppliers globally to exercise market power due to its large size. Its agreement with the Coca Cola Company also places it in a better market power over its competitors and suppliers by allowing it to lower prices. No other restaurant can sell Coca Cola products at a lower price except for McDonald’s. The McDonald’s also effectively triggers and favors competition through underpricing policies on some of its commodities and taking them to the best locations (McDONALD, 2016). McDonald’s also enjoys a wide range of audience reach which is made possible through its networking policies to reach more customers globally. The wide audience advantage helps the company to enjoy a better ability to reach more target customers and increase the products awareness globally through some services that are special in nature such as home delivery services.

The other strengths of the McDonald’s are that it is one of the most famous and recognizable brands in the field of food chain and restaurant industry. It has been one of the largest restaurants that operate on food chain distributions globally. It enjoys a better revenue base through its ability to reach more customers in terms of its recognizable brands in the market. The revenue of operations of the company ranges on a worth of over USD 41 billion which makes it one of the most valuable companies and restaurants globally. The brands and products of the McDonald’s are widely recognized and have a better reputation which plays a vital role in the detection of a wide customer base worldwide.

The McDonald’s Corporation plays a vital role in the detection of the brand in marketing and recognition of customer basis globally to assist in worldwide distribution of resources (Jurevicius, 2017). McDonald’s creates a wide range of operations globally that ensures the welfare of the customers and has a better global recognition in terms of creation of awareness and competitive advantage. McDonald’s enjoys a wide range of creation of awareness to help the company sell and introduce new products to new customers and spend little money on advertising its products entirely. The other strengths are that the McDonald’s has created a better reputation to assist it in creation of customer bases especially through the creation of an innovative recognitions in the field of fast food chain delivery. McDonald’s enjoys a good reputation that basically rely on innovations in the delivery of fast foods globally to its customers and it has generated more revenue to many countries in its lanes of operations.

Weaknesses

The McDonald’s enjoys some weaknesses in its lines of operations that have challenged its operations in one way or the other. The McDonald’s finds it hard to locate some of its prime locations and sites to set operations and develop golden arches which normally is a weakness and disadvantage for the company. In the United States of America, for instance, the company is faced with existence of diverge and saturated markets and locations to set up new operations. The challenge to open new points of locations in USA since the markets there are saturated with its own products and other restaurants. It is therefore forced to diverge to other countries which is a challenge culturally and economically for the McDonald’s Company.

McDonald’s also faces another huge weakness in its progression that is on the hiking annual rates of dividends which actually ruin the operations of the company in the US and globally. The annual dividend hikes and changes have affected and slowed the rates of growth of dividends among the shareholders of the company and are even depicted and expected to slow further. The slowed growth rates of dividends have posed a huge weakness to the operations of the company.

Opportunities

The McDonald’s enjoys huge opportunities especially outside the US in terms of global operations and market nature. The new opportunities have placed the McDonald’s in an advantageous position to compete with other companies and restaurants in the fresh grounds. The McDonald’s Corporation is also exposed to growth opportunities in Asia especially in China which has expanded its sales and profit margins (Jurevicius, 2017). The other opportunity is the menu innovations utilized by the McDonald’s are highly limited in terms of imagination. McDonald’s enjoys extreme opportunities for growth and expansion in the countries of its operations which makes it profitable and one of the leading companies in food and beverages supply and sales.

McDonald’s enjoy low interest rates to increase development and opportunities that focus on the provision of cheap capital for growth and expansion. The McDonald’s is associated with dollar denominated debts and loans to restaurants in the United States of America as well as in the Asian countries through the issuance of the yuan-denominated bonds and debts in Hong Kong. The opportunities have increased sales and operations in all the regions and restaurants globally for a competitive and advantageous capacity. The innovations have opened the economic statuses of operations of the company in the US and globally.

Threats

The McDonald’s Corporation is also exposed to major threats in its line of operations and functioning. Some of the threats revolve about the formulation of policies and government rules and regulations that pose a huge challenge to the company’s operations in the US and in other country of operations (McDONALD, 2016). The governments are imposing rules and regulations to affect the food products in terms of quality and extensive measures of operations. McDonald’s face increased competition from other companies and restaurants that deal with similar products and commodities such as the strongly peered Burger King, Yum! brands and other stocks. The McDonald’s also face a major threat from well established and competitive companies which have often launched new products that are more liked and preferred by the customers which include the coffee products by the Starbucks and smoothies by Jamba which are normally better in terms of establishment and competitive advantage. The increase in prices of products and commodities is normally associated with increasing a number of challenges to the McDonald’s including changing costs and weakened economy of operations. Weak economies are generally associated with limited ability to pass price hikes over to its consumers.

In conclusion, it is clear that the McDonald’s Corporation enjoys better strengths and opportunities as compared to the weaknesses and threats which mean that the company is enjoying huge profit margins and systems of operations as compared to the other companies and restaurants that deal with food chain delivery in United States of America. The SWOT analysis of the company implies that it has been leading in operations and has continuously dominated the field of fast-foods and beverages delivery to customers.

References

Jurevicius, O. (2017). McDonald's SWOT analysis 2017.

McDONALD, M. A. L. C. O. L. M. (2016). Strategic marketing planning: theory and practice. In The marketing book (pp. 108-142). Routledge.