Value Chain Analysis: Mcdonald's Value Chain

763 Words4 Pages
Value Chain Analysis Inbound Logistics Raw Vegetables are purchased from a defined supplier as well as local grocery stores. Meat and dairy are purchased through backwards vertical integration process. An example of backwards vertical integration is purchasing a farm to supply food and eventually becoming of a business of its own. Once the business is established, McDonald’s will purchase a new farm. This is done to ensure they are receiving the best quality and to reduce costs. Coco-Cola is the only soft drink provider. Operations There are separation Stations where they perform different steps to prepare the food. Large Grill- to cook a lot of burgers Dressing Station- to add toppings to the burgers Fryer- where french fries are made Soda Fountain & Milk Shake Machine- for deserts and beverages Counter-to place and receive orders Outbound Logistics McDonald’s Focus is to be innovative and improve…show more content…
McDonalds needs its supplier to provide good quality food at a low price so it can maintain its low prices. The supplier needs McDonalds to ensure they have a large order being placed every month or so. The supplier power is moderate and not high because there are many substitute suppliers. The supplier has more a reliance on McDonalds because if they lose them as a customer, it is not certain they will find another customer that will provide them as many sales as McDonalds. Threats of Substitute: High Because McDonalds is categorized as a fast food chain we must consider substitutes all fast food chain not just food chains with products they have in common. Wendy’s is a substitute with several products in common with McDonald’s. Yum! Brands which includes Taco Bell, KFC, Pizza Hut, Long John Silvers and A&W are diverse substitutes meaning they have few products in common with McDonalds but are still a fast food restaurant and McDonald’s second competitor. Threats of New Entrants:
Open Document