SWOT analysis of McDonalds Corporation
This SWOT analysis examines McDonalds Corporation, one of the largest fast food retailers in the world with locations throughout the globe. Despite its ongoing leadership position, there are numerous environmental, social, cultural and economic changes around the world that may be impacting the fast food chain and changing its profitability and leadership position. In response, a company like McDonalds Corporation has to reconsider its strategy in terms of what it can do well, where it needs to improve, how to identify the best opportunities for current and future growth, and any identifiable threats that it must address as part of its strategy.
- McDonalds is one of the most well-known brands in the world with a long-standing history of offering a wide range of fast food choices.
- The company promotes from within, building strong talent loyalty and maintaining a high level of motivation among its staff and leadership. It is also known for its significant investment in training and development of its staff, which then provides a better experience for customers.
- It has the most fast food market share in the world as well as the greatest brand equity.
- McDonalds Corporation knows how to operate locally with a strong focus on cultural diversity among its staff and on its menu to serve local tastes and customs.
- The company partners with some of the world's top brands for promotions and cross-selling.
- The company uses a franchise model for the majority of its operations, which means that having local owners increases chances for greater success because the owners realise they are responsible for much of their success.
- Many product launches have failed because they have failed to do the right market research and understand what customers want.
- They have ignored the market potential of certain types of foods and ingredients, including the demand for organic food.
- There have been controversies about what is in their food, including the use of chemicals and other non-food ingredients, tarnishing their reputation for quality and freshness.
- Much of their food is considered fattening and responsible for obesity, especially its marketing toward young people to encourage them to not necessarily make the best food choices.
- There is very little differentiation between their food menu and their competition whilst their competition like Burger King, Wendy's, and Carls Jr. are often viewed as having more delicious food.
- There is an opportunity to revamp their menu to address the demand for healthier, natural food items besides just adding salad and granola to their menu.
- McDonalds can explore the opportunity of home meal delivery, competing against pizza chains that have introduced sandwiches and salads to their delivery menus.
- They can address specific customer groups with specific habits and interests, including the organic market as well as those consumers looking for gluten and peanut free items.
- They could revise their restaurant image and try introducing more of the cafe style restaurants to create a more upscale feel for the brand.
- There is market saturation in numerous developed economies, including McDonalds and its competition with more consumers starting to look at other options, including healthy sandwich chains, supermarkets, and boutique quick serve formats that offer more of a selection.
- Healthier eating and clean eating are becoming more important to consumers with advocacy groups designed to fight obesity, especially in children, which have targeted McDonalds as the culprit for this obesity and unhealthy eating habits.
- On a local level, McDonalds must contend with local restaurant chains that may be able to offer better local cultural food choices as well as better pricing on those items.
- As a global company, McDonalds must deal with the threat of currency fluctuations and global economic issues that create volatility in terms of exchange rates for the company when accounting for their foreign revenue.
- McDonalds has faced numerous lawsuits, which can be financially costly as well as adversely impact brand equity. This includes lawsuits for unhealthy food and the idea that they are adding addictive chemical additives to the food.
- There is always the threat of biological agents like e-coli outbreaks.