Syl Buss -Revised-Syllabus-2014-15 m com -Revised-Syllabus-2014-15 m com

1. 1
ENTREPRENEURSHIP
PROJECT
PROJECT REPORT ON
FRANCISING OF
MCDONALD’S

2. 2
INDEX
SL. NO. TITLE PAGE NO.
1
MCDONALD’S
an Introduction
3-4
2
History of Mcdonald’s & Key Landmarks - McDonald’s
India Journey 5-9
3 Goals and Objectives, Mission Statement & Awards 10-11
4
Corporate Social Responsibility 12
5 McDonald’s International & Business model
13-14
6
Marketing Mix 15-17
7
SWOT Analysis 18-19
8 McDonald’s Role in the Indian Economic Growth &
Consolidated Balance Sheet of McDonald’s 20-24
9 People … McDonald’s # 1 Resource in India & The
McDonald’s Promise 25-27
10 McDonald’s India… Culturally Sensitive & McDonald’s
Cold Chain in India 28-30
11 Questionnaire & Survey Analysis
31-32

3. 3
12 The Top Five Reasons Why McDonald’s is so Popular
33
13
Findings 34
14 Conclusion
35
15 Bibliography
36
MCDONALD’S
AN INTRODUCTION
McDonald's Corporation (NYSE: MCD) is the world's largest chain
of hamburger fast food restaurants, serving around 68 million customers daily in
119 countries.
Headquartered in the United States, the company began in 1940 as a barbecue
restaurant operated by Richard and Maurice McDonald; in 1948 they
reorganized their business as a hamburger stand using production
line principles. Businessman Ray Kroc joined the company as a franchise
agent in 1955. Ray Kroc subsequently purchased the chain from the McDonald
brothers and oversaw its worldwide growth.
A McDonald's restaurant is operated either by a franchisee, or an affiliate, or
the corporation itself. The corporation's revenues come from the rent, royalties
and fees paid by the franchisees, as well as sales in company-operated
restaurants.

4. 4
McDonald's revenues grew 27 percent over the three years ending in 2007 to
$22.8 billion, and 9 percent growth in operating income to $3.9 billion.
McDonald's primarily sells hamburgers, cheese burgers, chicken, French
fries, breakfast items, soft drinks, milkshakes and desserts. In responseto
changing consumer tastes, the company has expanded its menu to
include salads, wraps, smoothes and fruits.
An exterior view of the world's largest McDonald's restaurant built on 2012
London Olympics site
In July 2011, McDonald's announced that their largest restaurant in the world
will be built on the 2012 London Olympics site. The restaurant will contain
over 1,500 seats and is half the length of an American Football field. Over 470
staff will be employed serving on average (during the 2012 Olympics) 100,000
portions of fries, 50,000 Big Macs and 30,000 Milkshakes. This restaurant will
overshadow the current largest McDonald's in the world in Moscow, Russia. In
January 2012, the company announced revenue for 2011 reached an all-time
high of $27 billion, and that 2400 restaurants would be updated and 1300 new
ones opened worldwide.

5. 5
History of McDonald's
The McDonald's restaurant conceptwas introduced in San Bernardino,
California by Dick and Mac McDonald of Manchester, New Hampshire. It was
modified and expanded by their business partner, Ray Kroc, of Oak Park,
Illinois, who later bought out the business interests of the McDonald brothers in
the conceptand went on to found McDonald's Corporation.
McDonald's is the leading global foodservice retailer with more than 32,000
local restaurants serving more than 58 million people in around 130 countries
each day. 70 percent of our restaurants worldwide are owned and operated by
independent, local businessmen and businesswomen.
In India, the brand is managed by two business entities...
 Connaught Plaza Restaurants Private Limited, led by Mr. Vikram Bakshi,
JV Partner and Managing Director, North & East India
 Hardcastle Restaurants Private Limited, led by Ms. Smita Jatia, Managing
Director, South & West India
McDonald's philosophy of QSCV (Quality, Service, Cleanliness and Value) is
the guiding force behind its service to the customers in India. Following its
philosophy of being sensitive to local food and cultural preferences, India was
the first country in the McDonald's system where it served non-beef and non-
pork products. More than 70 percent of the menu in India has been locally
developed with complete segregation of vegetarian and non-vegetarian products
right from the food processing plants to the point of serving the customers.
McDonald's commitment to its Indian customers is evident even in development

6. 6
of special sauces that use local spices and chillies. The mayonnaise and all other
sauces are egg-less. McDonald's also pioneered the establishment of Cold Chain
across India which helps maintain freshness and nutrition in every product.
McDonald's regular scrumptious menu includes wide range of products like
McAloo Tikki, Filet-O-Fish, Spicy Range, Chicken McGrill, McVeggie, Veg
Pizza McPuff, Chicken Mcnuggets®, Fries, Wraps, an assortment of Sundaes,
Soft Serve and refreshing beverages such as Ice Tea & Cold Coffee with
outstanding service in a vibrant and lively ambience, for which McDonald's is
known worldwide.
McDonald's had further reinforced the branded affordability mantra via the
introduction of the Happy Price Menu which starts at Rs 25 only.
McAloo Tikki, Veg Surprise and Pizza McPuff developed in India are now
being exported to the countries in the Middle East
McDonald’s introduced Coke’s Georgia Gold range of hot beverages which was
developed especially for the Indian market in 2002
As a leader in QSR segment (Quick Service Restaurant) McDonald’s has
pioneered various industry benchmark practices over the past decadeof serving
Indian customers, including new concepts suchas…
 Oil Alliances in India by inking with petroleum giants BPCL and HPCL.
The two such alliances with BPCL outlets are in Mathura (2000) (UP)
and Doraha (2002) (Punjab)
 Novel menu formats such as an Express Model with a limited menu and
Kiosks with a variety of dessert offerings
 Home Delivery (McDelivery™): Providing even more convenience to
our customers. In Oct 2006, McDelivery on bicycle at Chandni Chowk
was launched and in March ‘07 an all India single delivery number (66
000 666) was introduced
 First Drive Thru Restaurant at NOIDA (UP) in 1997
 First Restaurant with operational Kitchen at Delhi Domestic.
Keeping pace with the customer evolving needs McDonald's also functions on
models that drive convenience and create unique differentiation like
McDelivery, Drive thru, Breakfast Menu, high ways and extended hours.
(Currently, available in select cities).
At present, there are 300 McDonald's restaurants in India.
The strong foundation that Ray Kroc built... continues today with McDonald's

7. 7
vision and commitment for its internal as well as external customers. Since then,
it has evolved into a value driven brand, and recognizes that affordability of its
products is an attractive proposition for its customers along with taste.
McDonald's continues to strengthen it business model and progress with
customers evolving needs.
Key Landmarks - McDonald’s India Journey
1996 …the first McDonald’s restaurant opened on Oct. 13, at Basant Lok,
Vasant Vihar, New Delhi. It was also the first McDonald’s restaurant in the
world not serving beef on its menu
1997…
 the first Drive –Thru restaurant at Noida (UP)
 the first disabled friendly store at Noida (UP)
1999…thefirst Mall location restaurant at Ansal Plaza (New Delhi)
2000…thefirst highway restaurant at Mathura (UP)
2001…thefirst thematic restaurant at Connaught Place (New Delhi)
2002…
 The first restaurant in a food court at 3C’s, Lajpat Nagar (New Delhi)
 The first restaurant at the Delhi Metro Station at Inter State Bus Terminus
 The first fundraiser in association with ORBIS and Dr. Shroff’s Charity
Eye hospital.(Delhi)
2003...The first Dessert Kiosk – Faridabad (Haryana)
2004… McDonald’s Delivery Service (McDelivery) introduced in New Delhi
2003-04… Indigenous products like McAloo Tikki, McVeggie and Pizza
McPuff exported to Middle East countries

8. 8
2006
 McDelivery on Bicycles flagged off at Chandni Chowk (Delhi)- another
first initiative by McDonald’s India
 100th McDonald’s Restaurant in India
 10th Year Anniversary
2007
 The first McDonald’s open in Eastern Region at Park Street, Kolkata
 The first restaurant opened at Airport (Domestic Airport, New Delhi)
 The first MFY restaurant opened at Greater Noida, Uttar Pradesh
2008…
 The First restaurant to start extended hours procedure at Cyber Greens,
Gurgaon and Saket, New Delhi
 The first restaurant to start Breakfast Menu at Janpath, New Delhi
2009…Thefirst McDonald’s Restaurant opens at Old Delhi Railway Station
2010…Thefirst reimaged new look restaurant opened at Ambiance mall,
Vasant Kunj 6
2011…
 McDonald’s introduces premium products in it is menu – McSpicy range
of products
 McDonald’s introduces Mcflurry (premium desserts)in Oreo and
chocolate crispy flavors
 McDonald’s introduces Wi-Fi across Delhi/NCR region
McDonald’s currently has 235 restaurants in India
The Northern Regionhas 110 restaurants –
§ Delhi – 40
§ Haryana - 15
 Faridabad –3, Manesar – 2 (Highway and Drive - Thru), Gurgaon –7,
Karnal – 1 (Highway and Drive - Thru), Panipat -1, Ambala -1

9. 9
§ Rajasthan-6:
 Jaipur – 3, Jodhpur – 1, Kota -1, Udaipur - 1
§ Uttaranchal -1:
 Dehradun – 1
§ Uttar Pradesh–29:
 Noida – 5, Greater Noida – 1, Ghaziabad – 7, Mathura – 1 (Highway and
Drive - Thru), Kanpur – 2, Meerut – 2, Lucknow –5, Agra – 1, Allahabad
– 1, Varanasi -2, Gajraula – 1 (Highway & Drive Thru), Khatauli -
1(Highway and Drive thru)
§ Punjab – 13
 Chandigarh – 2, Ludhiana – 2, Doraha – 1 (Highway and Drive - Thru),
Jalandhar – 2, Patarsi – 1 (Highway and Drive - Thru). Dasuya (Highway
and Drive Thru) – 1, Amritsar -1, Patiala -1, Zirakpur-2
§ WestBengal-3:
 Kolkata- 3
§ Himachal Pradesh -1:
 Jabli-1
§ Madhya Pradesh-2
 Gwalior – 1, Bhopal -1
----------------------------------------------
The Western Region has 125 restaurants across the following states and cities –
Maharashtra - Mumbai, Pune, Nasik, Kolhapur –
Gujarat - Ahmedabad, Vododara, Surat, Indore, Vapi
Madhya Pradesh– Indore
Andhra Pradesh- Hyderabad
Karnataka - Bangalore
Tamil Nadu - Chennai

10. 10
GOALS AND OBJECTIVES
1. McDonald’s vision is to be the world’s best quick service restaurants
experience.
2. McDonalds is committed to maintaining and developing the best food
products in the quick service restaurant market.
3. In order to deliver this, the company has made a number of commitments to
food safety and nutrition.
4. Lead the Quick Service Restaurant market by a program of site development
and profitable restaurant openings, and by attracting new customers. Increasing
sales through promotions will enable them to continue their program of
expansion.
5. McDonalds have an objective to continual enhance and improve their menu.
This will better satisfy their customers and give customers more reason to visit.
Many ideas for new items on the menu come from the franchisees responding to
customer demand. Consumer tastes change over time and McDonalds has to
respond to these changes.
MISSION STATEMENT
"McDonald's vision is to be the world's best quick service restaurant experience.
Being the best means providing outstanding quality, service, cleanliness, and
value, so that we make every customer in every restaurant smile."

11. 11
AWARDS
McDonald’s India has received many prestigious awards for its service and
performance including:
 The ‘MostRespectedCompany’ for four consecutive years (2003-2006)
in the Food Services sector, by Businessworld
 The ‘MostPreferredFastFood Outlet’ 2006 & 2007 by Awaaz
Consumer Award hosted by CNBC
 Star Retailer – the ‘Consumer Way, FoodServices Retailer’ ofthe
Year 2006 & 2007, 2008 by Franchise India
 ‘Retailerofthe Year’ Award for catering services (2004-2006) at the
Images Retail Awards
 The ‘Amity Corporate Excellence Award’ –in 2007 & 2008
 The ‘MostWanted Brand of the Year’ Award 2003 & 2004 by
Franchising Holdings India Ltd.
 The ‘MostAdmired F & B Retailerof the Year: QSRs Foreign
Origin’ – The Golden SpoonAwards by Images Retail
 The Company with the BestCorporate Conscience – 2008 by Business
& Economy
 ‘Value for Money’ brand – 2010 by Pitch Magazine
 The most trusted family restaurant brand in the country awardin
2010 byReader’s Digest

12. 12
Corporate Social Responsibility
Being responsible is at the core of everything that we do at McDonald's™. It is
a deep-rooted value and a tradition that dates back to our founder Ray Kroc. It is
also one of our top business priorities.
We believe that our continuing success depends onour stakeholders trust in
each and every aspectof our business, be it the quality and safety of the food we
serve; in the way we do our business; the way we connect and make the
difference in the communities we operate; being sensitive to environment and
being sustainable.
1 We are committed to doing what is right
2
We are committed to be a good neighbour and partner in the
community
3
We are committed to conducting our business ethically and with
complete transparency
4
We are committed to treating our entire internal and external
stakeholders with respectand dignity

13. 13
McDonald’s International
 McDonald’s has over 32,000 local restaurants in more than 100 countries
 70 percent of our restaurants worldwide are owned and operated by
independent, local businessmen and businesswomen
 McDonald’s serves nearly 50 million customers each day
 McDonald’s first franchised restaurant opened at Des Plaines, Illinois in
1955 by the founder Ray Kroc
 McDonald’s has its own Hamburger University in Illinois, and the first
batch graduated in 1961
 12 classes offered at Hamburger University are college accredited
 In 1963, McDonald’s sold its one billionth hamburger
 McDonald’s is listed on the New York, Frankfurt, Munich, Paris and
Tokyo stock exchanges
 McDonald’s aired its first network TV advertisement “McDonald’s -
Where Quality Starts Fresh Everyday”, in 1965
 The first McDonald’s Drive-Thru opened in Sierra Vista, Arizona in 1975

14. 14
 Happy Meals were added to McDonald’s menu in 1979
 McDonald’s launched the new worldwide Balanced Active Lifestyles
public awareness campaign in 2005
 McDonald’s celebrated its 50th Anniversary on April 15, 2005
Business model
McDonald's Corporation earns revenue as an investor in properties,
a franchiser of restaurants, and an operator of restaurants.
Approximately 15% of McDonald's restaurants are owned and
operated by McDonald's Corporation directly. The remainder are
operated by others through a variety of franchise agreements and
joint ventures.
The McDonald's Corporation's business model is slightly different
from that of most other fast-food chains. In addition to
ordinary franchise fees and marketing fees, which are calculated as
a percentage of sales, McDonald's may also collect rent, which may
also be calculated on the basis of sales.
As a condition of many franchise agreements, which vary by
contract, age, country, and location, the Corporation may own or
lease the properties on which McDonald's franchises are located. In
most, if not all cases, the franchisee does not own the location of its
restaurants.
The United Kingdom and Ireland business model is different than
the U.S, in that fewer than 30% of restaurants are franchised, with
the majority under the ownership of the company. McDonald's
trains its franchisees and others at Hamburger University in Oak
Brook, Illinois.
In other countries, McDonald's restaurants are operated by joint
ventures of McDonald's Corporation and other, local entities or
governments.

15. 15
As a matter of policy, McDonald's does not make direct sales of
food or materials to franchisees, instead organizing the supply of
food and materials to restaurants through approved third party
logistics operators.
According to Fast Food Nation by Eric Schlosser, nearly one in
eight workers in the U.S. have at some time been employed by
McDonald's. It also states that McDonald's is the largest private
operator of playgrounds in the U.S., as well as the single largest
purchaser of beef, pork, potatoes, and apples. The selection of
meats McDonald's uses varies with the culture of the host country.
MARKETING MIX
The marketing mix of a company consists of the various elements as follows
which form the core of a company’s marketing system and hence helps to
achieve marketing objectives. The marketing mix of McDonald’s is as follows:-
The McDonald plains its marketing by simple keeping 4Ps in mind
 Product
 Price
 Promotion
 Place
Product: - McDonald’s places considerable emphasis on developing a menu
which customers want. Market research establishes exactly what this is.
However, customers’ requirements change over time. In order to meet these
changes, McDonald’s has introduced new products and phased out old ones,
and will continue to do so. Care is taken not to adversely affect the sales of one
choice by introducing a new choice, which will cannibalise sales from the
existing one (trade off). McDonald’s knows that items on its menu will vary in
popularity. Their ability to generate profits will vary at different points in their
cycle. In India McDonalds has a diversified productrange focussing more on
the vegetarian products as most consumers in India are primarily vegetarian.
The happy meal for the children is a great seller among others.
Price:-The customer’s perception of value is an important determinant of the
price charged. Customers draw their own mental picture of what a productis
worth. A productis more than a physical item; it also has psychological
connotations for the customer. The danger of using low price as a marketing
tool is that the customer may feel that quality is being compromised. It is

16. 16
important when deciding on price to be fully aware of the brand and its
integrity.
In India McDonalds classifies its products into 2 categories namely the branded
affordability (BA) and branded corevalue products (BCV). The BCV products
mainly include the McVeggie and McChicken burgers that costRs 50-60 and
the BA products include McAloo tikki and Chicken McGrill burgers which cost
Rs20-30. This has been done to satisfy consumers which different price
perceptions.
Promotion:- The promotions aspectof the marketing mix covers all types of
marketing communications .One of the methods employed is advertising,
Advertising is conducted on TV, radio, in cinema, online, using poster sites and
in the press for example in newspapers and magazines. Other promotional
methods include sales promotions, point of sale display, merchandising, direct
mail, loyalty schemes, doordrops, etc. The skill in marketing communications
is to develop a campaign which uses several of these methods in a way that
provides the most effective results. Forexample, TV advertising makes people
aware of a food item and press advertising provides more detail. This may be
supported by in-store promotions to get people to try the productand a
collectable promotional device to encourage them to keep on buying the item.
At McDonalds the prime focus is on targeting children. In happy meals too
which are targeted at children small toys are given along with the meal. Apart
from this, various schemes for winning prices by way of lucky draws and also
scratch cards are given when an order is placed on the various mean combos.
Place:- Place, as an element of the marketing mix, is not just about the
physical location or distribution points for products. Itencompasses the
management of a range of processesinvolved in bringing products to the end
consumer. McDonald’s outlets are very evenly spread throughout the cities
making them very accessible. Drive in and drive through options make
McDonald’s products further convenient to the consumers.

17. 17
Other than the main four elements mentioned above there are a few other
elements too in the marketing mix, whichare as follows:-
People:-The employees in McDonald’s have a standard uniform and
McDonald’s specially focuses on friendly and promptservice to its customers
from their employees.
Process:-The food manufacturing process at McDonald’s is completely
transparent i.e. the whole process is visible to the customers. In fact, the fast
food joint allows its customers to view and judge the hygienic standards at
McDonald’s by allowing them to enter the area where the process takes place.
The customers are invited to check the ingredients used in food.
Physical evidence: - McDonalds focuses on clean and hygienic interiors of
is outlets and at the same time the interiors are attractive and the fast food joint
maintains a proper decorum at its joints.

18. 18
SWOT ANALYSIS
Strengths
 McDonald’s holds a very strong brand name worldwide.
 They have large partnerships with other companies that provide them
with their desired products;this increases the goodwill of the company.
 McDonald’s is one of the most reputed firms who are socially
responsible.
 Loyal employees & management & customer are their biggest strength.

19. 19
 McDonald’s makes sure that cultural & regional barriers are kept in mind
while providing food to different countries.
 Clean environment and play areas for children where they can enjoy their
time.
Weakness
 The weakness that hits the list of employee turnover rate. Every year
many of their employees are fired out of the restaurant.
 McDonalds mostly advertises products and food items that targets
children.
 Health conscious people often complain that they do not provide us with
the organic and healthy food. This becomes their weakness when they
get in the complaints.
 They also face quality issue at times. This affects the business as they are
running the outlet worldwide, if one franchise gets affected others also
get a bad name.
Opportunities
 It can open up online services for their customers so that they can easily
order their desired meals sitting at home.
 Discounts given on every food item may help them gain more customers.
 They can go for a joint venture with the retailers they work with.
 They can introduce healthy hamburgers and healthy drinks for the people
who are health conscious.

20. 20
 In order to be environment friendly, they can use packing material which
can be recycled later or material that does not create pollution.
Threats
 Emerging competition of similar outlets is becoming a problem for
McDonalds.
 Health issue also becomes a problem when it comes to food.
 As it is a multinational food outlet, fluctuations in the currency of other
countries becomes a problem for such companies.
 Recessionin any country would definitely affect the whole outlet
worldwide.
 People facing heart problems and obesity accuse McDonalds for not
providing them with the healthy food.
 They have a threat of local food outlets in different countries.
 McDonalds is operating in a fully fledged economy where competition is
increasing day by day therefore they should work effectively to overcome
their drawbacks because of the recession.
McDonald’s Role in the Indian Economic Growth
In 1990, six years before the opening of the first McDonald's restaurant in India,
McDonald’s and its international supplier partners worked together with local
Indian companies to develop products that meet McDonald's vigorous quality
standards. These standards also strictly adhere to Indian Government
regulations on food, health and hygiene. Part of this development has involved
the transfer of state-of-the-art food processingtechnology, which has enabled
Indian businesses to grow by improving their ability to compete in today's
international markets.

21. 21
Prior to McDonald’s arrival in India, the conceptof a Cold Chain for the
distribution of food and dairy products from the farm to the end supplier in
predetermined and stringently enforced climactic and hygienic conditions was at
a very nascent stage of development. Forfive years prior to opening the first
restaurant, McDonald’s pioneered the effort to develop this aforementioned
Cold Chain so that trademarked high standards would be assured. This concept
has today been adopted by various Indian and International players to deliver
quality produceto consumers.
For instance, Cremica Industries worked with another McDonald's supplier
from Europe to develop technology and expertise, which allowed Cremica to
expand its business from baking to also providing breading and batters to
McDonald's India and other companies. Another benefit is expertise in the areas
of agriculture, which allowed McDonald’s, and its suppliers to work with
farmers in Ooty, Pune, Dehradun and other regions to cultivate high quality
Iceberg lettuce. This includes sharing advanced agricultural technology and
expertise like utilization of drip irrigation systems, which reduce overall water
consumption, better seeds & agricultural management practices, which result in
greater yields.
In some cases, these Indian suppliers had the technology - but no market for the
products they produced. Forexample, Dynamix Dairies - through its
relationship with McDonald's - was introduced to a large customer of milk
casein and other milk derivatives. McDonald's local supply networks through
Radhakrishna Foodland, to get products from the various suppliers to
restaurants across India.
McDonald’s North India alone contributes Rs.30.7crore(USD 7.76
million)/annum approximately as sales tax to different State Governments
where we have our operations.
COMPANY’S FINANCIAL INFORMATION
Company Name: McDonald's Corporation
Ticker Symbol: MCD
Web Address: www.mcdonalds.com
CEO: Mr. Donald Thompson
No. of Employees: 420,000
Common Issue Type: CS
Business Description: McDonald's Corporation franchises and operates McDonald's
restaurants in the food service industry. The Company and its
franchisees purchase food, packaging, equipment and other

22. 22
goods from numerous independent suppliers.
Industry Information: LEISURE - Restaurants
Price Day Change Bid Ask Open High Low Volume
87.18 -0.02 - - 87.43 87.43 86.76 3658828
Market Cap (mil) Shares Outstanding (mil) Beta EPS DPS P/E Yield 52-Wks-Range
87,526.7 1,004.0 0.39 5.27 2.53 16.4 3.5 102.22 - 83.31
KEY FIGURES (Latest Twelve Months -
LTM)
Yesterday's Close 87.06 $
PE Ratio - LTM 16.4
Market Capitalisation 87,526.7 mil
Latest Shares Outstanding 1,004.0 mil
Earnings pS (EPS) 5.27 $
Dividend pS (DPS) 2.53 ¢
Dividend Yield 3.5 %
Dividend Payout Ratio 48 %
Revenue per Employee 64,300 $
Effective Tax Rate 31.3 %
Float 1,015.3 mil
Float as % of Shares Outstanding 99.9 %
Foreign Sales 18,478 mil
Domestic Sales 8,528 mil
Selling, General & Adm/tive (SG&A) as %
of Revenue
9.10 %
Research & Devlopment (R&D) as % of
Revenue
0.00 %
Gross Profit Margin 44.7 %
EBITDA Margin 35.6 %
Pre-Tax Profit Margin 29.1 %
Assets Turnover 0.8 %
Return on Assets (ROA) 16.1 %
Return on Equity (ROE) 39.2 %
Return on Capital Invested (ROCI) 20.4 %
Current Ratio 1.0
Leverage Ratio (Assets/Equity) 2.4
Interest Cover 16.6
Total Debt/Equity (Gearing Ratio) 0.96
LT Debt/Total Capital 48.0 %
Working Capital pS 0.06 $
Cash pS 2.17 $
Book-Value pS 13.83 $
Balance Sheet (at a glance) in Millions
DIVIDEND INFO
Dividend Declared Date 09/20/2012
Dividend Ex-Date 11/28/2012
Dividend Record Date 12/02/2012
Dividend Pay Date 12/16/2012
Dividend Amount 770
Type of Payment Cash Payment
Dividend Rate 3.08
Current Dividend Yield 3.5
5-Y Average Dividend Yield 3.1
Payout Ratio 48.0
5-Y Average Payout Ratio 53.0
Share price performance previous 3 years
Share price performance intraday

23. 23
Tangible Book-Value pS 11.10 $
Cash Flow pS 6.89 $
Free Cash Flow pS 1.25 $
KEY FIGURES (LTM): Price info
Price/Book Ratio 6.30
Price/Tangible Book Ratio 7.85
Price/Cash Flow 12.6
Price/Free Cash Flow 69.9
P/E as % of Industry Group 42.0 %
P/E as % of Sector Segment 77.0 %
PRICE/VOLUME High Low Close % Price Chg % Price Chg vs. Mkt. Avg. Daily Vol Total Vol
1 Week - - - 0.0 101 54,041 66,217
4 Weeks 87.43 83.31 84.74 2.7 101 57,129 856,929
13 Weeks 94.16 83.31 91.02 -4.4 98 61,288 3,554,700
26 Weeks 94.16 83.31 87.75 -0.8 93 59,419 7,189,758
52 Weeks 102.22 83.31 98.03 -11.2 79 59,272 14,521,666
YTD 102.22 83.31 - -13.2 77 59,774 13,807,695
Moving Average 5-Days 10-Days 10-Weeks 30-Weeks 200-Days Beta (60-Mnth) Beta (36-Mnth)
86.61 86.31 88.25 89.31 91.74 0.39 0.31
GROWTH RATES
5-Year
Growh
R² of 5-Year Growth
3-Year
Growth
Revenue 3.81 77.6 6.66
Income 20.17 81.1 9.78
Dividend 15.36 94.7 10.16
Capital Spending 6.97 NA 10.52
R&D 0.00 NA 0.00
Normalized Inc. 11.58 NA 9.79
CHANGES
YTD vs.
Last YTD
Curr Qtr vs.
Qtr 1-Yr ago
Annual vs.
Last Annual
Revenue % 2.1 -0.2 12.2
Earnings % -1.4 -3.5 11.3
EPS % 1.0 -1.4 15.1
EPS $ 0.04 -0.02 0.69
SOLVENCY RATIOS
SHORT-TERM SOLVENCY RATIOS
(LIQUIDITY)
Net Working Capital Ratio 2.71
Current Ratio 1.3
Quick Ratio (Acid Test) 1.0
Liquidity Ratio (Cash) 0.67
Receivables Turnover 21.5
Average Collection Period 17
Working Capital/Equity 6.2
Working Capital pS 0.88
Cash-Flow pS 6.77
Free Cash-Flow pS 2.09

24. 24
FINANCIAL STRUCTURE RATIOS
Altman's Z-Score Ratio 4.85
Financial Leverage Ratio (Assets/Equity) 2.3
Debt Ratio 56.4
Total Debt/Equity (Gearing Ratio) 0.87
LT Debt/Equity 0.84
LT Debt/Capital Invested 56.9
LT Debt/Total Liabilities 65.2
Interest Cover 17.3
Interest/Capital Invested 1.67

25. 25
People … McDonald’s # 1 Resource in India

26. 26
McDonald's India is an employer of opportunity, providing quality employment
and long-term careers to the Indian people. A McDonald's restaurant employs
around 50 people on an average, performing 25 different job responsibilities -
from the counter crew to the restaurant manager. Starting with 50 employees in
1996, McDonald’s world-class training inputs to its employees can today be
seen in close to 10.000+ employees currently employed directly with
McDonald's restaurants across India. Additional indirect employment
contributes to over 2000 people (Suppliers /service agents etc.)
The training centers at Delhi & Mumbai provide world-class training to every
employee. It is ensured that each employee who has undergone an extensive
training program is judged at the end of every courseinvolving assessmentat
regular intervals. Some of the courses are the Basic Shift Management Course
(BSM), Advance Shift Management Course (ASM), Effective Management
Practices Course (EMP) and candidates who were till now attending the
Restaurant Leadership Practices Course (RLP) in Australia can now do the
same, here in India with the supportof McDonalds Hamburger University.

27. 27
The McDonald’s Promise
QUALITY, SERVICE, CLEANLINESS & VALUE
When asked to explain McDonald's success, founder Ray Kroc used to say, "We
take the hamburger business more seriously than anyone else."
Kroc was a perfectionist. From the day he opened his first restaurant, he vowed
to give his customers high quality products, served quickly --and with a smile,
in a clean and pleasant environment, and all at a fair price. Quality, Service,
Cleanliness and Value (QSC&V)became the philosophy that drove McDonald's
business.
QUALITY
McDonald's India serves only the highest quality products. Theattention to food
quality started long before the first restaurant opened. McDonald's India has
established close relationships with local suppliers who provide McDonald's
with the highest quality, freshest ingredients to make its products.
All suppliers adhere to Indian government regulations on food, health and
hygiene while continuously maintaining McDonald's own recognized standards.
McDonald's has established an extensive "cold chain" distribution system in
India to ensure that the products, which arrive at the restaurant from suppliers
all over India, are absolutely fresh. In the restaurants, products and supplies are
used on a "first-in, first-out" basis to ensure freshness. All McDonald's products
are prepared using modern, state-of-the-art cooking equipment to ensure quality
and safety.
SERVICE
McDonald's India provides fast, friendly service -- the hallmark of McDonald’s,
which sets its restaurants apart from others. At McDonald's, the customer
always comes first. Every employee strives to provide 100 percent customer
satisfaction -- for every customer -- every visit. This includes friendly and
attentive service, accuracy in order taking, and anticipation of customer's needs
-- such as napkins or straws. The McDonald’s promise is “With a sense of fun
and youthful spirit, we will proudly serve an exceptionalMcDonald’s
eating experience that makes all people feel specialand makes them smile –
every customer, every time.”

28. 28
CLEANLINESS
McDonald's restaurants provide a clean, comfortable environment especially
suited for families. McDonald's stringent cleaning standards ensure that all
tables, seating, highchairs and trays are sanitized several times each hour. The
attention to cleanliness extends from the lobby to the kitchen to the sidewalk
and immediate areas outside the restaurant.
In addition to urging customers to disposeof their litter properly and offering a
number of trash bins (both inside and outside the restaurants) for their
convenience, McDonald's "Litter Patrols" walk around the restaurants several
times each day picking up litter -- even if it isn't from McDonald's.
Restaurant managers walk through the dining areas each hour, to ensure that it
is clean and well stocked. All restaurants provide a variety of comfortable
seating arrangements to accommodateanyone -- from a single individual to a
large family. The environment is warm, inviting, and well lit.
VALUE
McDonald's menu is priced at a value that the largest segment of Indian
consumers can afford. McDonald's does not sacrifice quality for value -- rather
McDonald's leverages economies of scale to minimize costs while maximizing
value to customers.
McDonald's definition of value is broader than most restaurants of its kind -- it
is more than price. Value at McDonald's is the sum of the total McDonald's
experience:quality food; fast, friendly service;a cleanand pleasant
environment, and products priced at very affordable prices for the largest
segmentof Indian consumers possible. Thatis value at McDonald's.

29. 29
McDonald’s India… Culturally Sensitive
Indianisation of Menu
With the opening of the first McDonald’s restaurants in India- there is much
that is consistent with other McDonald’s restaurants around the world, suchas
the quality of the food and the attention to service.
The dedication to local cultures is not new for McDonald’s. Forthe past 50
years, McDonald’s has opened restaurants in more than 120 distinctly different
countries and cultures. With guidance from its local partners, McDonald’s is
able to adapt- where necessary-its menu and restaurant operations to
complement existing eating-out options. McDonald’s local owners understand
what their customers want perhaps more importantly, what is acceptable within
local customs and values.
There is much, too, that is very different- such as the first beef-less and pork-
less menu in the world and special productformulations to cater to Indian
culture and palate. Vikram Bakshi, the joint venture partner for McDonald’s
India, says “We know the Indian culture, because we were born in it,
inherited its richness, and respectit greatly. It is the respectfor this culture
and the sentiments of many of our customers’, that we do not serve any
beef and pork items in our restaurants.”
McDonald’s commitment to its Indian customers is evident even in
development of special sauces that use local spices and chillies. The
mayonnaise and all other sauces are egg-less.
In India, vegetarianism is in many cases more than a lifestyle choice. Many
people are vegetarians due to religious reasons, and in some cases even the
vegetarian productthat has come into contact with a non-vegetarian productis
unacceptable. Hence, McDonald’s India has also changed its operations to
address the special requirements of our vegetarian customers by having
processes that ensure that a physical separation of veg and non-veg products is
maintained right from farm to the customer. Vegetable products are prepared
separately, using dedicated equipment and utensils. Also in India, McDonald’s
uses only vegetable oil as a medium for cooking.

30. 30
McDonald’s Cold Chain in India
McDonald's India is characterized by a unique sense of dedication and commitment –
‘to be driven by the leadershipof local owners.’This commitment has translated
into enduring benefits to the businesses at the grass root level, in the areas of
introduction of new crops, new agricultural practices and food processing methods
and procedures.
McDonald's unique 'cold chain', on which the QSR major has spent more than six
years setting up in India, has brought about a veritable revolution, immensely
benefiting the farmers at one end and enabling customers at retail counters get the
highest quality food products, absolutely fresh and at great value.
Setting up this extensive cold chain distribution system has involved the transfer of
state-of-the-art food processing technology by McDonald's and its international
suppliers to pioneering Indian enterprises, which are today an integral part of the
McDonald’s cold chain.
From Fieldto -2⁰C in90 Minutes
Trikaya Agriculture, a major supplier of iceberg lettuce to McDonald's India, is one
such enterprise that is an intrinsic part of the cold chain. Initially lettuce could only be
grown during the winter months but with McDonald's expertise in the area of
agriculture they are now able to grow this crop through the year.
Post harvest facilities at Trikaya include a cold chain consisting of a pre-cooling room
to remove field heat, a large cold room and a refrigerated van for transportation where
the temperature and the relative humidity of the crop is maintained between 1º C and
4º C and 95 per cent respectively. Vegetables are moved into the pre-cooling room
within half an hour of harvesting. The pre-cooling room ensures rapid vacuum cooling
to 2º C within 90 minutes. The pack house, pre-cooling and cold room are located at
the farms itself, ensuring no delay between harvesting, pre-cooling, packaging and
cold storage.
Trikaya is not associated with us any longer and iceberg lettuce is now locally sourced
from our partners Vista ProcessedFoods Pvt. Ltd
Flavour and Freshness lockedin at - 35°C
Vista ProcessedFoods Pvt. Ltd., McDonald's suppliers for the chicken and vegetable
range of products, is another important player in this cold chain. This includes hi-tech
refrigeration plants for manufacture of frozen food at temperatures as low as - 35° C.
This is vital to ensure that the frozen food retains it freshness for a long time and the
'cold chain' is maintained. The frozen product is immediately moved to cold storage
rooms.

31. 31
Our Backbone:Cold Chain & Suppliers
McDonald’s Cold Chain In India
From Farm to Bulk Cooler in less than 90 Minutes
McDonald's suppliers of cheese, Dynamix Dairy, too, recognizing the need for
quality milk to make quality cheese, has set up a dedicated quality program for
milk procurement. They have made significant investments in setting up bulk
coolers at all milk collection centres in the Baramati area, where they are based.
On receipt, the milk is immediately stored in the bulk coolers at the collection
centres, to prevent growth of bacteria in the milk and preserve its freshness -
thus, maintaining the 'cold chain'.
All leading to the Consumer
McDonald's local supply networks through Radhakrishna Foodland, which
operates distribution centres (DCs) for McDonald's restaurants across India. The
DCs have focused all their resources to meet McDonald's expectation of 'Cold,
Clean, and On-Time Delivery' and plays a vital role in maintaining the integrity
of the products throughout the entire 'cold chain'.
Ranging from liquid products coming from Punjab to lettuce from Pune, the DC
receives items from different parts of the country. These items are stored in
rooms with different temperature zones and are finally dispatched to the
McDonald's restaurants on the basis of their requirements. The company has
both cold and dry storage facilities with capability to store products up to -22º C
as well as delivery trucks to transport products at temperatures ranging from
room temperature to frozen state.
All these suppliers share McDonald's commitment and dedication to satisfying
customers by supplying them the highest quality products. Theyare working
cohesively to ensure that the final productreaches the customer consistently
each time and every time. At their level, every care is taken to guard against any
interruptions in the cold chain, which can break the link and have a detrimental
effect on the quality of the product. And more products reaching the market
fresher and quicker not only benefit the economy but also help the farmer earn
more.

32. 32
QUESTIONNAIRE
1. How often do you visit fast food restaurants?
Everyday Alternatedays Weekends Once in a
month Once every threemonths
2. Which of the following fast food chain do you visit the most?
Subway McDonald’s KFC PizzaHut
BurgerKing
3. Are you satisfied with the services provided by them
Yes Sometimes Notat allsatisfied
4. How often do you eat at McDonald’s?
Everyday Alternatedays Weekends Once in a
month Once every threemonths
5. Which among the following is your favourite productat McDonald’s?
BigMacBurger MacVeggie BigMacChickenBurger
MaharajaMac MacFiletoFish
6. Is the productline of McDonald’s adequate?
Yes No Haven’t ThoughtAboutThat
7. Whattime of the day do you prefer to eat at McDonald’s?
Morning Noon Evening Night
8. Whatis the main problem you faced at McDonald’s?
Longqueues Wrongorders Hygienicproblems
Otherproblems No problems
9. Whatare the unique selling prepositions of McDonald’s?
Productvariety Hygiene Ambience Quick service
Location Other
10.Do you think McDonald’s will be triumphant over all its competitors?

33. 33
Yes Maybe Haven’tThoughtAboutThat Never
Thank You!!
SURVEY RESPONSE ANALYSIS

34. 34
THE TOP FIVE REASONS WHY MCDONALD’S IS SO
POPULAR
Frequency of visits
made to fast food
centers
Everyday
Alternate
days
Weekends
Once in a
month
Fast food chain
visited the most
Subway
MacDonald's
KFC
Pizza Hut
Burger King
Favourite product at
Macdonald’s
Big Mac
Burger
Mac
Veggie
Big Mac
Chicken
Burger
Maharaj
Mac
Mac Fileto
Fish
Time of the day
prefered to eat at
Macdonald’s
Morning
Noon
Evening
Night
Main problem faced
at McDonald’s
Long queues
Wrong orders
Hygienic
problems
Other
problems
No problems
The unique selling
prepositions of
MacDonald’s
Product
variety
Hygiene
Ambience
Quick service

35. 35
1. The System
This is the first thing that makes McDonald's so successful, by
having an effective and efficient system in place, which exploits the
minimum wage labour available, in the form of young teenagers
who are just looking to make some cash or pick up fundamental job
skills.
2. Convenience
The second reason why McDonald's is so popular is because it's
everywhere. There a McDonald's at every corner of the map, at
every major shopping centre, district, highway, freeway, every
place which attracts even, remotely more than 10 people, will have
a McDonald's restaurant not too far from them. McDonald's is
having the best Real Estate locations around the world which makes
it so popular around the globe.
3. Likability and Familiarity
The Golden Arches, the Big M. Ronald McDonald, happiness and
fun; all these are the associations with McDonald’s which makes it
so familiar by being so familiar to all age groups and to everybody.
4. The Menu
McDonald's has one of the most diverse menus, targeting all ages
from little kids to old pensioners, and everyone else in between.
There's Big Macs for the big kids and junior burgers for the little.
The menu's versatility is accentuated when they introduced the
"healthy tick" concept, which target those people who wants to
watch what they eat (even though it doesn't make sense to go to
a fast food restaurant to eat healthy).
5. Consistency
The last reason is, McDonald's is so successful because of its
consistency. The expectations that we have about everything
surrounding the store are fulfilled in almost every store nationwide,
worldwide. So everybody knows what they're getting into before
they come to McDonald's, and by being so consistent, it has a solid
reputation to uphold.
Findings

36. 36
 At McDonalds, the corporateculture and management system are strictly
imposed, detailed operating manuals followed to the letter and an
extensive field organization checks on each store to enforce standards.
 The organizational development focused upon generating revenues from
the existing operations.
 They give different trainings to their employees/ managers to work in
more productive way, and to achieve the goals of the organisation.
 The domestic growth has slowed as a result of market saturation but
McDonald’s global foodservice business delivered good results, and was
possible only due to expansion and positive comparable sales.
 McDonald's develop a deep connection between McDonald’s and the
local communities in which it operates.
 McDonald's believes that the success ofthe restaurants and the company
is achieved through the people it employs.
 The company aims to recruit the best people, to retain them by offering
ongoing training relevant to their position and to promote them when they
are ready.
CONCLUSION

37. 37
What started as a simple food stand on Huntington drive, California in 1937,
through the ages have become a billion Dollar corporationand the world’s
second largest fast-food chain. When analysed, one would understand that
McDonald’s had a stable growth in the past years.
The credits of building it into one of world’s largest fast food operation can be
given to Ray Kroc who took over McDonald’s from its establishers, modernised
and expanded it to suit the contemporary trend. Today McDonald’s has a net
worth of $15.15 billion.
Through this project report and market survey we saw the how McDonald’s was
formed, its history and the present position. We also its list of various products
offered and the corporateprofile.
Through the marketing mix, we saw how they make use of their product, price,
place, promotion mixes. SWOT analysis showed us the strengths and weakness
of McDonald’s as well as the opportunities and threats they have got.
The consolidated financial statement showed us the financial position of the
corporation as of 2011. The questionnaire survey provided us with a clear
picture of the needs, want and expectations of the consumers of the fast food
market in general and McDonald’s in particular. The respondents also rated the
services provided by the corporation. At last we also saw the top five reasons
that make McDonald’s so popular.
I gladly hope that this project has met its aim.
Let me conclude by quoting this quote by Ray Kroc
"Perfection is very difficult to achieve, and perfection was what I wanted in
McDonald's. Everything else was secondaryfor me."

38. 38
BIBLIOGRAPHY
 www.google.com
 www.wikipedia.org
 www.macdonalds.com
 www.marketing91.com
 www.aboutmacdonalds.com
~~~~~~~~~~~~