Case Study and SWOT analysis

Case Study : Ronald McDonald 's Goes to China

Introduction

McDonald 's entered Hong Kong in 1975 and Beijing only in 1992 . After about seven years , there were already 235 McDonald 's restaurants across China and in Hong Kong there were 158 franchises as of 1999 (Watson 2000 . Today , there are already about 200 outlets and more than 10 ,000 staff in Hong Kong (McDonald 's HK , 2007 ) while in Beijing there are 90 outlets some of which are offer 24-hour service (CEN , 2006 . The entry of McDonald 's in China , although the

country is known for its rich deep-rooted culture , has become successful primarily because of the changing lifestyles of the people themselves along with the changing characteristics of the country 's demographics . This case study identifies the problems McDonald 's in China is facing and recommends possible solutions to the problems identified

Problem Identification

McDonald 's is faced on the issues on how to stay competitive in the fast food industry and on how to take advantage of the many opportunities available for them . If McDonald 's does not take advantage of these opportunities , its competitors are likely to grab such opportunities . According to Watson (2000 , China is currently experiencing changes with its demographic characteristics such as changing family system , lifestyles , family values , aging population , and rising incomes . Due to these opportunities . China has become more attractive to other fast food companies that the number of fast food restaurants as well as the intensity of competition in the country is increasing . There is the KFC , Pizza Hut , Mos Burger , California Beef Noodle King , Starbucks , Yoshinoya , and recently , Burger King . All of them have their own market segments and have their own way of attracting customers . Burger King for instance had already entered the Chinese market in 2005 (AP , 2005 ) and can be expected to expand across China in the next few years . Burger King has many similarities with McDonald 's from the quality of service to the quality of products as well as with the ability to attract customers . Additionally , Burger King also knows how to innovate and differentiate products from that of the competitors (e .g . patties are grilled thus the taste of its burgers is distinguishable from that of other brands

Another problem is that the taste of McDonald 's beef patties does not appeal to the Chinese adults (Watson , 2000 . This means that the adult segment of McDonald 's market eat there not because they like the taste of the foods but because of the popularity associated with it and the comfort especially the children and teenage customers find at every McDonald 's restaurants . Burger King , McDonald 's number one competitor in the United States which has been proven to have better tasting burgers than McDonald 's , may soon become a big threat to McDonald 's if McDonald 's will not give careful attention in improving the taste of its burgers to suit the taste preferences of the Chinese

Identification of Options or Alternatives

McDonald 's...