Good Essay On McDonald's
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A mission statement shows the purpose of the company. It puts the limelight on the industry a company engages (Wheelen 99). The McDonald’s business mission statement fabrication involves serving a boundless set menu of sizzling; delicious food swiftly in a clean, sociable cafeteria for an excellent value. It also suggests an extensive base profligate food clients worldwide. The McDonald’s mission statement fits the present market environment.
It has its basis on the company’s competitive advantage. It originates from leveraging the firm’s unique resources and skills (Stimpson 123). It helps in implementation of the value-creating strategies that are not implemented effectively by the competitors. The company has the mission statement based on the internal strength in addition to resources, and the company has good performance comparing with its competitors.
Macdonald’s corporation has experienced decrease in income for several years ranging from $5.6USD to $4.8USD. It has experienced comparatively flat revenues: (John Wiley & Sons 187). The reasons behind this are the increase in proportion of sales dedicated to cost of goods sold, income tax expenses in addition to SGA. Creation of a persistent relevant and satisfaction of customer experience indicates hallmarks of MacDonald’s business in addition to historical success (Jossey 129). The consumer’s needs, tastes and preferences changes with time. Macdonald’s present performance ought to have reflections on the urgent needs to evolve with the current clients, rearrange strategic priorities and bring back the business thrust. The driving goal is to create a destination of choice within the whole world in addition to reasserting the burger company.
The comparable US sales decreased by 4 percent in February as a result of aggressive competition. McDonald’s US started on March with a U-turn summit .Its aim was to deliver renewed energy in addition to focusing on the elements of the restaurant experience (Jossey 59). It considered what mattered most to the customers, provision of high-quality goods in addition to beverages, and compelling value in addition to outstanding services from a dependable brand. The company still makes profits despite it not being art of the mission statement (Stimpson 24). The McDonald’s mission statement has basis on in addition to their distinctive core competencies. The company has better performance in relation to its competitors due to the distinctive core competency. It has the attention on specified traits and targets specific market.
The sales in Europe increased by 0.7 percent in February. The mission statement is a source of motivation and inspiration to the employees (Wheelen 59). Its report is exclusive of making extra sales in addition to profits. Germany had partial offset of negative results in Russia. In Europe macroeconomic breezes, McDonald’s is still pursuing a balanced approach to directing the business through new menu offerings, emphasizing on the major favorites and exceptional value options.
The relative sales in APMEA decreased by 4.4 percent in February. It is attributable to the broad-based client perception issues in Japan (John Wiley & Sons 67). It partially offsets the benefits of shifting the time of Chinese New Year in China and other markets. In addition, Australia recorded positive results. Among the APMEA‘s top priorities includes the strengthening of McDonald’s quality and value awareness in 2015. There is a high relative sale in McDonald’s and other countries in addition to the corporate segment (Wheelen 179). They include the Latin America and Canada that played a significant role in the company’s global comparable sales performance. The revenues decreased by 8 percent in the month of February.
Macdonald’s has a customer-focused plan which centers as being better. It makes the workforce appreciate their work and feel that they are significant to other people’s lives. The company has a resolution that is the above cash creating (John Wiley & Sons 99). It offers a common framework for global business and gives room for local adaptation. They execute multiple initiatives surrounding five primary drivers of exceptional customer experiences. They are the people, products, place, price, and promotion. They have enhanced the restaurant experience for worldwide customers growing sales and customers in all the last six years (Wheelen 74). The plan in addition to financial discipline resulted in substantial results for the shareholders.
There are uninspiring sales; profits are falling and lagging of the stock prices in the market. There is the inheritance of the reversal project by Steve Easterbrook from MacDonald’s corp. Analysts say that its execution requires plenty of time. Investors have not hesitated in provision of their support behind the fast food chain’s new chief executive officer.
There is a legal battle that awaits Vikram Bakshi involving control of 185 MacDonald’s outlets (McDonald 130). It has steered extension of U.S chain in half of the country inclusive of Delphi and the Haryana and Punjab states standing still. It is a challenge that awaits the incoming CEO of the company. He has the task of revitalizing the brand following a 4.8% drop in same stores in Africa, Asia Pacific and Middle East in the past quarter.
Financial health and direction
According to McDonald’s annual report for the year ended December 31, 2013, sales increased from $27,567 million in 2012 to $28,105.7 million in 2013 (Aboutmcdonalds.com 27). There was also an increase in net income from $5464.8 million in 2012 to $5,585.9 million in 2013. The net profit margin increased from 19.82% to 19.87% indicating a slight improvement in the profitability of the company. In 2013, the firm experienced a slight decline in return on equity from 35.73% to 34.89%. This would be a concern to the current and potential shareholders of the company. The total debt ratio for McDonald’s declined from 56.78% in 2012 to 56.29% in 2013 showing a slight improvement in the solvency of the company. The decline also indicates the improvement in the solvency in the debt-equity ratio from 1.314 in 2012 to 1.287 in 2013.
The above figures imply that the company is performing well, and the improvement in profitability is a favorable movement. The high debt ratio would be a concern since more than half of its assets are financed through borrowing. However, the slight reduction in the total debt ratio is a movement in the right direction for the company.
Aboutmcdonalds.com,. 'Annual Reports: Aboutmcdonalds.Com'. N.p., 2015. Web. 2 Apr. 2015.
Hamel, Gary. What Matters Now: How to Win in a World of Relentless Change, Ferocious Competition, and Unstoppable Innovation. San Francisco, CA: Jossey-Bass, 2011. Print.
McDonald, Lawrence G, and Patrick Robinson. A Colossal Failure of Common Sense: The Inside Story of the Collapse of Lehman Brothers. New York: Crown Business, 2009. Internet resource.
McDonald, Malcolm, and Ian Dunbar. Market Segmentation: How to Do It and How to Profit from It. Chichester: John Wiley & Sons, 2012. Print.
Stimpson, Peter, and Alex Smith. Business and Management for the Ib Diploma. Cambridge: Cambridge University Press, 2011. Print.
Wheelen, Thomas L, J D. Hunger, Alan N. Hoffman, and Charles E. Bamford. Strategic Management and Business Policy: Globalization, Innovation, and Sustainability. , 2014. Print.
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