MacDonald Restaurant: Principles, Challenges, and Role in Entrepreneurship

This report discusses the principles, challenges, and role of MacDonald restaurant in entrepreneurship. It provides a brief description of the restaurant, explores its foundation and principles, and discusses the industry sector it belongs to. The report also examines the application of entrepreneurship at MacDonald restaurant and the challenges it faces. Additionally, it discusses the role of MacDonald restaurant in satisfying customer needs, creating job opportunities, and contributing to the growth of towns. Overall, the report highlights the significance of MacDonald restaurant in the business context.

Running Head: ENTREPRENEURSHIP 1
BSMAN3004 Entrepreneurship
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ENTREPRENEURSHIP 2
Introduction
The following topics are discussed in the report about MacDonald restaurant; Brief description of MacDonald
restaurant, principle, and foundation of entrepreneurship, role, and nature of entrepreneurial activities, industry
sector it belongs to, application of entrepreneurship, challenges facing entrepreneurs, level of entrepreneurship
and factor that contribute probability of new ventures.

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MacDonald Restaurant
A brief description of MacDonald restaurant
It is one of the largest American fast-food chains in the world, and the headquarters are located at Oak
Brook, Illinois. In 1948 two brothers Richard McDonald and Maurice (“Mac”) started the first
McDonald’s restaurant in San Bernardino, California. Salesman Ray Kroc sold them appliances which they
used for their small restaurant which they sold hamburgers, the needs of the two brothers for shake mixers and
eight malts made them intrigued with Ray Kroc. In 1954 Kroc discovered that the brothers produced huge food
quantities at prices which were very low through an efficient wrong, simple format that allowed them and also
how the two brothers could sell so many pints of milkshakes at their small shop, he discovered all this during
his visit.
Kroc on seeing the restaurant great promise concept he offered the MacDonald brothers to start a franchise
program. In Des Plaines, Illinois Kroc opened franchise program which was the first in the MacDonald and
launching of McDonalds Corporation in 1955.1961 he bought the McDonalds brothers eventually
(Mallapragada & Srinivasan 2017).

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Principles and foundation of McDonald restaurant
The following are the factors that contributed to the success of the McDonald restaurant;
a. Suitable location
The location of a business is the key to success.MacDonalds restaurants have been included in
strip malls and shopping centers where it is easily accessible to customers since it is only
walking distance or just a few minutes’ drives.
b. Selling meals rich in Nutrition
The commitment of McDonald’s restaurant to its customer’s wellbeing has a part of its
success. In order to provide wellbeing and nutrition expert guidance McDonald comes up
with a council that would provide advice globally in the year 2004. The company also
came up with an idea of providing a menu in order to satisfy customers health
consciousness. McDonald’s customer’s health acknowledgment has helped the fast food
company to succeed.
c. Affordable prices
McDonald has attracted many customers by the use of the affordable meal and the availability
of meals through the day. The company also provides customers with a menu that offer full
meals and the customers only pay at a meager price.
d. Availability of customers
A critical factor in the success of McDonald’s is its ability to appeal to a wide range of
customers. McDonald provided a variety of choices for the parents since they came up with
meals that will appeal to children and make them happy and also meals that are healthy for
their bodies.
Role and nature of McDonald’s restaurant

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McDonald restaurant has played a significant role in the business context, which includes;
a) Satisfying customer’s need
McDonald restaurant has played a significant role in the organization context since it can satisfy
their customers’ needs by providing the fast food which is available across the whole world at
affordable prices and of which are healthy for human consumption.
b) Creation of job opportunities
McDonald restaurant has created many job opportunities for people across the world since the
company is found globally. This has helped increase the living standards of people and reduced
poverty levels.
c) Growth of towns
The towns where these restaurants are located have developed industrial wise since there is job
creation and helps motivate entrepreneurs to start a business.

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Application of entrepreneurship at McDonald restaurant
McDonald restaurant started as a small business enterprise through the creativity and innovation of the two
McDonald brothers and Ray Kroc the small developed (Schmid & Gombert 2018). Ray Kroc came up with new
products that the business would sell. Ray Kroc bought an already existing business from the McDonald
brothers and developed it from the small business it was to a worldwide fast food restaurant. McDonald’s
restaurants are located in urban areas where they are close to the customers, and they have a unique symbol that
helps it distinguish itself from the rest. In case of need for improvement for the company, new creative ideas are
implemented in order to attract and retain its customers (Laužikas, Miliūtė, and Tranavičius & Kičiatovas
2016).
Level of entrepreneurial activities
MacDonald restaurant is a worldwide organization since it serves various countries which imply that it is an
international level enterprise.
The industry sector McDonald restaurants belong to
MacDonald restaurant belongs in the secondary sector industries. Secondary industry is also known as the
production sector, and these sector activities include human activity branches. This is an industry that processes
raw materials that are provided by the primary sector to products and commodities that are later sold to the
customer's .some examples of this industries include; food processing industries, energy, and oil refining
industries, light manufacturing industries and heavy manufacturing (Fukushima, 2016). MacDonald restaurant
is a food processing industries it uses products like wheat flour, cooking oil and many others products from the
primary industries to manufacture and produce products like; burgers, chicken and sandwiches, salads, desserts
and shakes, apple pies and cookies.

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Challenges McDonald restaurant face
According to Wade, Holmes, and Gibbs (2018), McDonald restaurant faces several challenges during its
operation. Some of these challenges include:
a) Lack of discounts.
McDonald consistency in the products has been a long attraction for its customers. When
someone buys a tremendous product, they are curious to know what they will be offered
as a discount or what to be given as compensation for the large purchase. Unlike
McDonald Chipotle offers the customers a place to hang around as they wait for their
orders to be delivered.
b) They experience price changes.
According to Harrington, Ottenbacher and Fauser (2017) it’s a challenge for the restaurant
to increase their prices for their products and at the same time retain all their customers,
for example, the prices of cheese and beef were raised, and they used them to make the
tasty big which was included in the dollar popular menu
c) Increased competition
New restaurants like Taco Bell has introduced and launched menu breakfast which has
posed a significant challenge to McDonald restaurant since it was the only company
offering special meals for breakfast another example of fast food company raising
competition is the Chipotle, Wendy's and the king burgers which have been
revived( Miller,2016).

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d) Quality issues
After McDonald invited its customers to question through a social media campaign that
was launched last week requesting them to ask questions concerning their foods. The
customer's questions that were first asked included why their foods do not rot and if the
chickens they use they are real.
e) Services that are Slow and inaccurate
The introduction of too many activities at the same time have caused their services to slow
down which has led the orders to be inaccurate.
Factors which influence the probability of a new venture
Factors that may influence a new venture in McDonald restaurant includes; change of customers tastes this will
lead the restaurant to change what they are offering and start to sell what the customers want since they want to
retain and attract more customers (Boo, 2017), creativity of new ideas if new ideas come up that will help
improve and develop the business the fast-food company has to venture in the new business opportunity.

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Conclusion
McDonald restaurant is a food processing industry; it belongs to the secondary sector. It started as a small
business belonging to the two McDonald brothers and which was later sold to Ray Kroc. Through Ray Kroc
creativity and innovation the small hamburger and milkshakes shop developed to a substantial fast food
company that is found everywhere across the world.it is well known for its nutrition affordable meals, however
it experiences some challenges like completion, lack of flexibilities to new changes, a bad image for the foods
they sell and many others. The company plays an essential role in the business context like creating jobs,
improving living standards for the employees, encourages entrepreneurship around the places they are located
and helps in the growth of towns and industries.

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References
Boo, H. V. (2017). Service environment of restaurants: findings from the youth customers. Journal of ASIAN
behavioral studies, 2(2), 67-77.
Fukushima, Y. (2016). Primary and Secondary Sectors of Industry. Energy Technology Roadmaps of Japan:
Future Energy Systems Based on Feasible Technologies Beyond 2030, 368.
Harrington, R. J., Ottenbacher, M. C., & Fauser, S. (2017). QSR brand value: Marketing mix dimensions among
McDonald’s, KFC, Burger King, Subway and Starbucks. International Journal of Contemporary
Hospitality Management, 29(1), 551-570.
Laužikas, M., Miliūtė, A., Tranavičius, L., & Kičiatovas, E. (2016). Service innovation commercialization
factors in the fast food industry. Entrepreneurship and sustainability issues, 4, 108-128.
Mallapragada, G., & Srinivasan, R. (2017). Innovativeness as an Unintended Outcome of Franchising: Insights
from Restaurant Chains. Decision Sciences, 48(6), 1164-1197.
Miller, C. (2016). An Analysis of the International Expansion of Burger King.
Schmid, S., & Gombert, A. (2018). McDonald’s: Is the Fast Food Icon Reaching the Limits of Growth?.
In Internationalization of Business (pp. 155-171). Springer, Cham.
Wade, R., Holmes, M. R., & Gibbs, C. (2018). The Challenges of Full-Service Restaurant Brand
Internationalization: The United States/Canada Perspective. Journal of foodservice business
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