Business Policy and Strategy

Business Policy and Strategy
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Business Policy and Strategy
To survive in a highly competitive business environment such as that of fast food industry, a company must adopt vigorous strategies capable of creating a competitive advantage over other companies in the same industry. McDonalds Company has been very effective in establishing and implementing such strategies enabling the company to rank as one of the most profitable fast food and retail business. In essence, the company has been able to overcome economic huddles both in the domestic market as well as in the international markets. The strategies have also been designed subdue the competition posed by industrial competitors such as Chipotle. The following discussion examines the strategy adopted by McDonalds’s strategy and its implications on the fast food market.
McDonalds’ strategy is focused more on its value end price continuum especially following the decline in sales that the company has been facing the recent past (BurgerBusiness, 2013). This implies that the company will focus more on marketing its products and innovation in terms of product variations. As one of the core components of the company’s global strategy, the company hopes to use promotion to push up sales and to increase its customer base as well as to stay ahead of industrial competitors such as Chipotle.
Chipotle’s strategy is guided by its objective which it defines as striving to do few things but doing them well (Lutz, 2015). This has in turn helped increase the quality of products and services that the company offers in the market as compared with other players in the industry. In fighting with such upcoming competitors, McDonalds has introduced innovative products such as the "Dollar Menu + One" in which most products are priced between one and two dollars (BurgerBusiness, 2013). The company is also cutting down on its capital expenditures primarily in regard to expansion in developing markets. Chipotle on the other hand has been focusing on perfecting their recipes to offer quality and sophisticated products to their clientele.
Comparing the two competitors, McDonalds is in a good position to overcome competition from Chipotle especially in the low income market segment given its low pricing strategies and increased marketing. Chipotle may however pose a competition problem for McDonalds in the middle and high income market segments as the former is increasingly becoming popular for its recipes and design of restaurants which some people consider as being more than those of McDonalds (Lutz, 2015).
In conclusion, McDonalds’ strategy is focused on increased competition and reduced capital expenditures in regard to overseas expansion. The company has been aiming at creating value end in its price continuum by bringing ...