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Mcdonald's Swot Analysis

838 words - 4 pages

SWOT ANALYSIS

S – Strengths or Core Competencies

* Strong global presence, considered a market leader in all markets.

McDonald’s is a global company that “operates more than 23,500 restaurants in 109 countries.”1 The company’s strong global presence is an significant advantage for them, because it gives them the ability to “play” with economic fluctuations of each country.

By being spread out in different regions, the company is able to contest the economic fluctuations which are localized by country. McDonald’s has an advantage as it can operate effectively even in an economic downturn as at such times people seek out comfort food more.

* Relies upon economies of scale ...view middle of the document...

Workers in the fast food industry are paid low wages. McDonald's do not pay overtime rates even when employees work very long hours. Pressure to keep profits high and wage costs low results in understaffing, so staff have to work harder and faster. As a consequence, accidents (particularly burns) are common. The majority of employees are people who have few job options and so are forced to accept this exploitation, and they're compelled to 'smile' too! Not surprisingly staff turnover at McDonald's is high, making it virtually impossible to unionise and fight for a better deal, which suits McDonald's who have always been opposed to Unions.

* Not adapted yet to the trend of organic food.

McDonald's promote their food as 'nutritious', but the reality is that it is junk food - high in fat, sugar and salt, and low in fibre and vitamins. A diet of this type is linked with a greater risk of heart disease, cancer, diabetes and other diseases. Their food also contains many chemical additives, some of which may cause ill-health, and hyperactivity in children. Don't forget too that meat is the cause of the majority of food poisoning incidents. In 1991 McDonald's were responsible for an outbreak of food poisoning in the UK, in which people suffered serious kidney failure. With modern intensive farming methods, other diseases - linked to chemical residues or unnatural practices - have become a danger to people too (such as BSE). 3

* Locked in price competition with competitors - low revenue margin.

* Lack of innovative products.

O – Opportunities

* Has the ability to adapt to the...

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