Description
Mcdonalds Case Study - SCM
McDonalds Case Study
Case Brief
Was started in California in 1937, by 2 brothers.
Critical Success Factors- Speed, Service and cleanliness.
1st attempt at franchising was a failure but under Kroc in 1950s franchising took off.
Faced stiff competition and health issues in 1990s. Countered by collaborating with Walmart and opening outlets in many stores.
85% of McDonalds outlets owned by franchisees
Case Brief
Opened its 1st outlet in India in 1996. • Between 1992-96 worked in India to set up a perfect supply chain.
By 2001 – 28 outlets in India.
Established a cold storage chain(consisted of Pre chillers, freezers and reefers) Focus on development of Suppliers and Outsourcing.
SCM Pipeline
Farmer/Meat Supplier (Primary Source)
30 Suppliers
(Amrit Foods,
Dynamix Dairies, Trikaya Agriculture)
Central Distribution Centre (Mumbai & Delhi)
Distributor (RFPL)
McDonald’s Retail Outlets
Inbound Logistics
Outbound Logistics
Logistics Operations
Farm
Supplier
• Assisting farmers with new farming techniques. • Harvesting crops in the morning and storing them in pre- cooling rooms to remove field heat. • Transportation through Refrigerated Vans (Reefers)
Suppliers Re
DC
• 30 suppliers in total. • Processing of farm products/raw meat to make semi processed items. • Separate lines for Veg and Non Veg. Utilization of excess capacity. • Standardization/Improvement of suppliers. • Temperature control maintained. • Reefers to central DC. • Excess capacity utilized by other vendors.
DC
- Objective : “ Cold, Clean, On-time Delivery”
Outlet
- Distribution outsourced to Mumbai-based Radhakrishna Foodland Private Ltd (RFPL). - Centralized cold storage DCs at New Delhi & Mumbai - Supply to McDonalds outlets on a daily basis - Each truck delivers multiple items at one go - Has maintained a tight “delivery-on-time” schedule with strict temperature control. - Possible since installation of ERP software, which provides Real Time data at each store and hence their demands.
Highlights
• One World, One Burger. (all sourcing from parent country) • Cold Chain • Central DC
RFPL
Procurement Quality inspection programme Storage & Deliveries to inventory the management restaurants
Data collection, recording and reporting.
Challenges
Poor roads & infrastructure challenges.
Strict temperature and moisture control for raw materials.
24*7 monitoring of pick-ups & truck movements.
Inventory constraints at outlets and DC.
SC Strategies
Sourcing Strategy
Vendor Development More than 90% sourcing from domestic suppliers
• Better facilities and infrastructures created along with new systems to satisfy McDonald's high demands
Partnership with suppliers
• Focus on passing on technological inputs and techniques to farmers • Matching its suppliers and distributors to International Standards
Capacity Sharing
• Vehicle as well as Assembly Line
Product Strategy
Separate Customized assemblies Products for Veg and Non Veg.
Veg Oil for fries.
Stricter Quality Control Measures.
Formats
Restaurants, Drive Through. Tie up with different stores and outlets.
Recommendations
Place
More focus on Franchising. Increase the number of suppliers and their capacity. Increase seating space with in outlets. Increase the rate of expansion. Increase DCs in case of Expansion. Add the option of Home Delivery. Tie ups with retail giants in India. Book prime space for franchisees (to increase rental income)
Recommendations
Product
More focus on Vegetarian Products. Fat free products for health conscious customers.
Add lower priced sku’s in India.
Add more local products.
Bundle Pricing.
doc_706808047.pptx
Mcdonalds Case Study - SCM
McDonalds Case Study
Case Brief
Was started in California in 1937, by 2 brothers.
Critical Success Factors- Speed, Service and cleanliness.
1st attempt at franchising was a failure but under Kroc in 1950s franchising took off.
Faced stiff competition and health issues in 1990s. Countered by collaborating with Walmart and opening outlets in many stores.
85% of McDonalds outlets owned by franchisees
Case Brief
Opened its 1st outlet in India in 1996. • Between 1992-96 worked in India to set up a perfect supply chain.
By 2001 – 28 outlets in India.
Established a cold storage chain(consisted of Pre chillers, freezers and reefers) Focus on development of Suppliers and Outsourcing.
SCM Pipeline
Farmer/Meat Supplier (Primary Source)
30 Suppliers
(Amrit Foods,
Dynamix Dairies, Trikaya Agriculture)
Central Distribution Centre (Mumbai & Delhi)
Distributor (RFPL)
McDonald’s Retail Outlets
Inbound Logistics
Outbound Logistics
Logistics Operations
Farm
Supplier
• Assisting farmers with new farming techniques. • Harvesting crops in the morning and storing them in pre- cooling rooms to remove field heat. • Transportation through Refrigerated Vans (Reefers)
Suppliers Re
DC
• 30 suppliers in total. • Processing of farm products/raw meat to make semi processed items. • Separate lines for Veg and Non Veg. Utilization of excess capacity. • Standardization/Improvement of suppliers. • Temperature control maintained. • Reefers to central DC. • Excess capacity utilized by other vendors.
DC
- Objective : “ Cold, Clean, On-time Delivery”
Outlet
- Distribution outsourced to Mumbai-based Radhakrishna Foodland Private Ltd (RFPL). - Centralized cold storage DCs at New Delhi & Mumbai - Supply to McDonalds outlets on a daily basis - Each truck delivers multiple items at one go - Has maintained a tight “delivery-on-time” schedule with strict temperature control. - Possible since installation of ERP software, which provides Real Time data at each store and hence their demands.
Highlights
• One World, One Burger. (all sourcing from parent country) • Cold Chain • Central DC
RFPL
Procurement Quality inspection programme Storage & Deliveries to inventory the management restaurants
Data collection, recording and reporting.
Challenges
Poor roads & infrastructure challenges.
Strict temperature and moisture control for raw materials.
24*7 monitoring of pick-ups & truck movements.
Inventory constraints at outlets and DC.
SC Strategies
Sourcing Strategy
Vendor Development More than 90% sourcing from domestic suppliers
• Better facilities and infrastructures created along with new systems to satisfy McDonald's high demands
Partnership with suppliers
• Focus on passing on technological inputs and techniques to farmers • Matching its suppliers and distributors to International Standards
Capacity Sharing
• Vehicle as well as Assembly Line
Product Strategy
Separate Customized assemblies Products for Veg and Non Veg.
Veg Oil for fries.
Stricter Quality Control Measures.
Formats
Restaurants, Drive Through. Tie up with different stores and outlets.
Recommendations
Place
More focus on Franchising. Increase the number of suppliers and their capacity. Increase seating space with in outlets. Increase the rate of expansion. Increase DCs in case of Expansion. Add the option of Home Delivery. Tie ups with retail giants in India. Book prime space for franchisees (to increase rental income)
Recommendations
Product
More focus on Vegetarian Products. Fat free products for health conscious customers.
Add lower priced sku’s in India.
Add more local products.
Bundle Pricing.
doc_706808047.pptx