University Assignment: International Business Report on McDonald's

This report provides an in-depth analysis of McDonald's international business operations, focusing on its strategic and operational considerations. It explores the company's use of a transnational strategy, its approach to local market responsiveness, and its implementation of an ERP system. The report also examines the competitive environment, highlighting key rivals and McDonald's competitive strategies. Furthermore, it addresses the company's ethics and corporate governance, along with a SWOT analysis that identifies strengths, weaknesses, opportunities, and threats. The report concludes with recommendations for McDonald's, emphasizing the importance of exploring emerging markets and adapting to local consumer preferences. The study is supported by references to academic research and industry sources.

Running Head: INTERNATIONAL MARKETING
International Marketing
Name of the Student
Name of the University
Author Note

Running Head: INTERNATIONAL MARKETING
Executive Summary
The study explores the international business of McDonald’ and also focuses on the operational
and the strategic aspects of the company. The competitive environment of the company is also
briefly analyzed along with outlining the ethics and governance. The competitive environment
of the company is also highlighted along with providing a SWOT analysis. The conclusion part
is led by a brief recommendation.

Running Head: INTERNATIONAL MARKETING
Table of Contents
Introduction......................................................................................................................................4
Operational and Strategic consideration..........................................................................................4
The competitive environment..........................................................................................................5
Ethics and the Corporate Governance.............................................................................................6
SWOT..............................................................................................................................................6
Conclusion and Recommendation...................................................................................................7
References........................................................................................................................................8

Running Head: INTERNATIONAL MARKETING
Introduction
McDonald’s Corporation is one American fast food company which was founded in the
year 1940 in the form of a restaurant that was operated by Maurice McDonald, Richard
McDoland in California (US). They are found to be cherishing the business in the form of a
hamburger stand that turned later into a franchise with a Golden Arches logo introduced in the
year 1953. In terms of the revenues, McDonald’ is considered as the largest restaurant chain of
the world. It serves over 69 million customers every day in almost 100 countries. It is best
known for the cheeseburgers, the hamburgers, the French fries and chicken products too. As per
the reports of 2018, McDonald’ has been considered as the second largest private employer
having 1.7 million employers (Mcdonalds.com 2020).. Since, it is a global brand, it is quite
common that it will be present worldwide. Because of the globalization, McDonald’ is
developing many strategies in order to penetrate the global market and new countries. In this
report, the operational and the strategic considerations of McDonald’ will be analyzed along
with outlining the competitive environment.
Operational and Strategic consideration
It has been found that McDonald makes use of a transnational strategy for responding
locally and integrating globally. The company has identified that the market overseas needs and
extreme degree of local responsiveness and they are required to manage the business across
various regions efficiently and effectively that cannot be achieved through some other
strategies. This is the reason behind their focus on the local business management for some
better responsiveness to external ambience. They also hire some locals for bringing more

Running Head: INTERNATIONAL MARKETING
acceptance of the organization in the local market through the customers (Jeon et al. 2016). It is
useful for bringing out the culture if accountability, innovation along with the customer
responsiveness. The local department of management further helps the franchisee for addressing
the issues of the staffs considering the local culture. The use of the franchise model has
supported McDonald’ in reducing the price of developing some new businesses in few regions.
The strategy of McDonald’ in terms of the eco-friendliness is a type of new emerging idea. The
environmental sensitivity and friendliness has brought the company a goodwill and more
opportunities.
Since it is a transnational company, they have a standardized process and system in its
area for the business management efficiently. They have further implemented the ERP system
across the businesses of different countries. It is likely to help the company in reducing the cost,
reducing the manual work, efficiency and transparency regarding the sharing of the information
to the stakeholders (Allen and Carlson 2018). It company usually opens its outlet in the
metropolitan cities where there are middle class and the upper class citizens who can easily
afford the prices. Notably, their strategy of growth is founded on three such elements such as
increasing the number of the restaurants, maximizing the profits and the sales in previous
restaurants and also through improvement of the international profitability.
The competitive environment
It has been found that McDonald’ has many competitors each of which is in search of a
share of the market. McDonald’ identifies that it is not for the large chicken and burger chain but
the independently owned chips shops and fish shops too. Hence, McDonald’ is on the verge of

Running Head: INTERNATIONAL MARKETING
developing some competitive strategies which differentiates the company from the market rivals
such as Burger King, KFC, Subway and the like (Shabbir 2018)..
Ethics and the Corporate Governance
In McDonald’ they have declared that their business is founded on the truthfulness, ethics
and the dependency (Shabbir 2018). They do business with people having a solid, constructive
and permanent ethical program which will be in the style. The board of directors of McDonald’
is extremely responsible for the oversight of the corporation in a fair, honest, ethical and diligent
manner. The board also has believed in good corporate governance as critical for fulfilling the
obligations of the company on its shareholders (Shamah et al. 2018). The governance principles
are reviewed annually with a perspective of consistent improvement. The board of the directors
of McDonald’ have stood behind the commitment for ensuring that the integrity of the system of
McDonald is maintained.
SWOT
The strengths – The company has rolled out successfully the new items such as smoothies and
Angus burger having expanded the range of the menu choices. The operations of the company
are spread all around the world suggesting that McDonald’ is not limited to one economy or
currency (Allen and Carlson 2018)..
The weaknesses- It is becoming quite difficult for the company to identify the prime locations
for establishing a set of golden arches. Notably, the US has become saturated with the restaurants
and the growth will happen internationally driving some cultural changes.

Running Head: INTERNATIONAL MARKETING
Opportunities- There are many scopes for the company outside of the United States and it is
taking huge advantage of this fact. The leading scope for the company is in China. There are
low interest rates which provide cheap capital for the growth (Aleem 2019).. Additionally, it has
recently become the first foreign company for issuing the yuan bonds in the Hong Kong.
The Threats- It is facing huge competition in the market from Burger King and Yum! Brands.
The governments of different countries are putting regulations on the fast food.
Conclusion and Recommendation
On a concluding note, it can be said that McDonald’ is the pioneers of the franchising and
a leader of the fast food market. It is taking advantages of the growing opportunities out of the
US and globalizing a lot. It is recommended that the company should look out for the emerging
markets where the labour is quite cheap and the raw materials are available readily. Also, the
company should add some domestic treats with main products for catering to the tastes of the
consumers.

Running Head: INTERNATIONAL MARKETING
References
Aleem, A.A., 2019. A Study on Consumers Changing Consumption Habits, Preference &
Satisfaction Towards Fast food Centres. International Journal of Management, IT and
Engineering, 7(5), pp.88-97.
Allen, N. and Carlson, M.J., 2018. Focus: Why McDonald's Tax Practices Matter to the Global
Labour Movement. International Union Rights, 25(1), pp.8-28.
Jeon, H.J., Meiseberg, B., Dant, R.P. and Grünhagen, M., 2016. Cultural convergence in
emerging markets: The case of McDonald's in China and India. Journal of Small Business
Management, 54(2), pp.732-749.
Mcdonalds.com (2020). McDonald's: Burgers, Fries & More. Quality Ingredients.. [online]
Mcdonalds.com. Available at: https://www.mcdonalds.com/us/en-us.html [Accessed 15 Feb.
2020].
Schmid, S. and Gombert, A., 2018. McDonald’s: Is the Fast Food Icon Reaching the Limits of
Growth?. In Internationalization of Business (pp. 155-171). Springer, Cham.
Shabbir, M.S., 2018. Innovation Strategy of McDonald Business from Historical perspectives.
International Journal of Global Business, 11(2), pp.9-28.
Shamah, R.A., Mason, M.C., Moretti, A. and Raggiotto, F., 2018. Investigating the antecedents
of African fast food customers' loyalty: A self-congruity perspective. Journal of Business
Research, 86, pp.446-456.