McDonald’s Expansion to China Business & Marketing Essay (Essay Sample)
Read the proposal and answer the following three questions. CAGE
McDonald’s Expansion to China Proposal
McDonalds started in 1940 as a family restaurant in San Bernardino, California by Richard and Maurice McDonald. From a single shop serving a local community, the company has grown into a multi-billion dollar corporation spanning into numerous countries with thousands of storefronts. What helped to propel the company forward amongst its first local competitors was its ability to serve customers quickly by having the food previously prepared and kept warm under a heat light. This is what led McDonalds to start a revolution for fast food and give a comparative advantage that not many other restaurants couldn’t compete with at the time. Additionally, as McDonalds expanded outside of America, the company learned and adapted to their new host countries by serving a fast-food version of foods found within that country.
Our group has chosen to research the business practices of McDonalds in one of its biggest markets abroad, the Chinese market. The first McDonald's in China opened in 1990. More prominently, the largest McDonald's opened on April 23, 1992, in Beijing. We will be researching how McDonald's has been able to find a demand in China, how it has been able to adapt American food and an American business model to China, and how it has been able to be successful abroad.
1. Does the firm possess core competencies?
2. Why should it expand abroad (or what were the motives the firm had when it expanded to your chosen or focal country)?
3.Where should it expand given II., cross national distances, AND the opportunities of the country market (if you are doing this retrospectively, assess whether it made sense for the firm to expand to China)?
McDonald's Expansion to China
McDonald's Expansion to China
Rui (2016) acknowledged that two years after McDonald's entered China's mainland (Shenzhen) in 1990, it grew to form several other branches. Thirty years later, China is now the third country with several McDonald's locations globally, followed by Japan and others. The Chinese McDonald's slogan is 'affordable prices, good service and tasty flavors,' attributes that have made them sell in large for the company in a country with diverse culinary heritage.
McDonald's core competencies.
McDonald's got into the Chinese food market when there was little competition for Western food. This is perhaps one of the reasons why it gained much popularity over a short period. Other factors determined the competency of the company in China, like its production of great quality foods. Though McDonald's is known for tasty burgers, crispy French fries, and milkshake, they have, over time, made impressive local tastes to keep their customers. The restaurant conformed to Chinese foods, which has increased its demand in the market. They also have excellent customer service and friendly employees, whom they place on the forefront of useful services. With frequent checks, they ensure that the food served meets the recommended safety standards. The Chinese McDonald's Slogan of 'Get together at McDonald's...' makes families and friends always want to share meals at their outlets. They promote the feeling of togetherness amongst the locals. For those who wish to have celebrations of either birthdays or wedding anniversaries, McDonald's provides the locals with an affordable venue.
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