McDonald’s: “think global, act local” – the marketing mix
Focuses on the marketing mix of McDonald’s. Highlights how the company combines internationalisation and globalisation elements according to various fast food markets. Using the effect of strategical and tactical models, the case illustrates the effect of McDonald’s on the global environment and how they adapt to local communities. Describes future franchise plans for McDonald’s.
McDonald and Ray Kroc had various resources which may be termed as their business advantages over other enterprises in the same industry. First, they had a great innovation strategy especially in improving their menu and services. Secondly, they had already dominated the market. They were the market leaders in the restaurant industry and took this as one of their competitive advantages. Lastly, both had a strict focus on their business operation. Especially, Ray Kroc had much focus in making strategic management as the key to success.
One of the problems McDonald faced was choosing the wrong franchisor. Selecting Ray Kroc was the best choice they ever made. The second problem the Ray Kroc solved was the revenue problem of the franchisor. From the film, we have seen how Ray Kroc increased his value and wealth so that he could have full control of the business. Through this, he solved another problem that McDonald was facing. That is taking control of the business without allowing the franchisor to take control.
The contract is all about trust and being open to each other. In making an alliance, business people are supposed to have something that is guiding them in their alliance. Following that, I propose that Ray Kroc and McDonald should have a clause that dictated that McDonald should give and collect information of what they own and should let Kroc have full control over the properties. Failure to which, the subject should be fined a certain amount of money for not being open.
Harry Sonneborn became Ray Kroc main adviser. He showed him a new way of making extra money by creating real estate where Kroc could lease or sell them to McDonald for a more financial income. This made Kroc the main financier hence became so powerful and controlled almost all the business terms and conditions.
There are three main reasons why strategic alliances can fail. First, strategic alliances can fail because of a lack of trust. Trust is main and should be from both the franchisor and franchisee. Secondly, lack of adaptability may make strategic alliances fail. This is where both parties fail to adapt to the other party’s way of doing things. Lastly, they can fail because of a lack of resources such as time, money or expertise to spearhead the business. To end an alliance, there are three steps to be followed. First, one should involve all the stakeholders. Secondly, the alliance agreement or contract should be used to wind up an alliance. Lastly, one should incorporate the terminated alliance into the culture.
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