SOFT DATA
'The world’s largest hamburger chain, McDonald’s has more than 37,000 restaurants in 119 countries around the world. When McDonald’s first entered the Chinese market, they attempted to operate their own restaurants and up until 2010 franchises account for less than 5% of their outlets. But soon all the outlets will be franchises after their cooperation with CITIC & Carlyle. Looking forward they plan to develop the franchise business to maintain their annual growth pace of 17% which is 5% in 2016. McDonalds suffered losses after the 2014 expired meat scandal, but has continued its business with OSI after 50 years of partnership, still believing the quality of their meat to be superior. McDonald’s is working to improve their sustainable business practices with ambitious goals for 2020 including 100% fiber-based.
McDonald’s is known for localising their menu worldwide, sometimes even known as “McDonaldization” in China this means offering a special chilli garlic sauce with Chicken McNuggets, crispy chicken wings and chicken burgers are made using thigh fillet rather than the breast meat preferred in Western countries. They even offer themed specials around festival times like the Chinese New Year meal, which features a special chicken burger with a horoscope of the 12 zodiac signs and traditional red packets. Another unique feature of Chinese McDonald’s is their ‘McExpress’ hole-in-the-wall window where customers can buy a small range of drinks and desserts. The windows are either attached to a larger restaurant or physically independent. 24-hour home delivery is also offered.
ANALYSIS AND PURCHASING INSIGHTS
1. McDonald’s China website features pages about each of their ingredients and where they are sourced, as well as the supplier’s qualifications and product testing results in a bid to improve transparency.
2. McDonald’s focus right now is the expansion in lower tier cities.
