Case Study: MacDonald's.

Essay by adam25ukUniversity, Bachelor's January 2004

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Case Study:



For any business, becoming and staying the market leader is a huge task, even for household names such as McDonald's. Keeping ahead involves continuous hard work to enhance the reputation of the brand, together with product innovation based on detailed market research that indicates how to please customers.

When the McDonald brothers, Dick and Mac opened their first restaurant in 1940 in San Bernardino, California, they could never have imagined the phenomenal growth that their company would enjoy. From extremely modest beginnings, they hit on a winning formula selling a high quality product cheaply and quickly. However, it was not until Ray Kroc, a Chicago based salesman with a flair for marketing, became involved that the business really started to grow. He realised that the same successful McDonald's formula could be exploited throughout the United States and beyond. There are now more than 29,000 McDonald's Restaurants in over 120 countries.

In 2001, they served over 16 billion customers, equivalent to a lunch and dinner for every man, woman and child in the world! McDonald's global sales were over $38bn, making it by far the largest food service company in the world.

Today, many people live busy lives and place great importance on convenience when buying and paying for goods and services. Modern, quick service products such as mobile phones and ready made meals attract them. For many people this emphasis on instant service is a winning formula, particularly for younger people and young families.


In 1955, Ray Kroc realised that the key to success was rapid expansion. The best way to achieve this was through franchises. Today, over 70 percent of McDonald's restaurants are run on this basis. In the UK, the first franchised restaurant opened in 1986 - there are now over 1,200...