Overseas Expansion for Case Study of Mcdonald - myassignmenthelp

Question: Discuss about theOverseas Expansion for Case Study of Mcdonald. Answer: Overseas expansion is now very common with many small and large size organizations. This is full of opportunities to many while on the other hand it offers bunch of challenges as well. Despite the fact there is an incrementing trend in the overseas expansion. The expansion has benefitted the many while on the other side it has challenged the survival of few others (Pan et al. 2017). McDonald is no other exception. The company has started its journey from being just a family burger to become a global recognition (Hak and Gr?bosz 2016). The study shows a brief journey of McDonalds to the position it is at present. Moreover, the main purpose of this assignment is to understand the process of internationalization through the example of McDonalds. Types of Motivation had kept on changing with McDonald. They had initially used the traditional motivation, which is one of the kinds of motivation. McDonald had used traditional motivation while the company was in the stage of resource seeking and market seeking. The first international expansion came in the year 1967 when it opened up its store in Canada. The expansion occurred when McDonald has successfully crossed the resource seeking stage after 27 years of its establishment. After 27 years of the establishment, the company had felt the necessity to look for the market seeking strategy and therefore, it started its operations in Canada (Hutchinson, Singh and Walker 2012). The company had also used emerging motivation through competitive positioning and global scanning. The company had shown their extensive focus on the emerging markets, which is why it had used the competitive positioning and global scanning strategy to capture the target market. McDonald is very less active wit h the competitive positioning strategy as they are almost the same across the globe. However, minimal level of differentiation can still be found in the company. For example, McRice in Indonesia is a food that suits the food culture of the people living in Indonesia (Budiman 2012). McBeers are sold in Europe and Asia to satisfy the cultural beliefs of people living in those regions (King et al. 2012). Global scanning is the other strategy that McDonald has used to expand into the international market. McDonald has been sequential in approaching to the various international centers. Global scanning has actually helped the company expand to the various international markets at a very appropriate time. For example, McDonald started its expansion in the year 1967 in the closest markets. Later on, it moved to more distinct nations. The maximum expansion happened in the period of 1990s when there was political, technical and economic changes on a global scale. However, the expansion proce ss slowed down after 2000 due to international economic downturn and due to some internal issues (Badal 2017). Prequisition or prior to expanding into the global market, McDonald use to adopt a specific strategy such as providing location specific advantages. It is specific to McDonald that they provide location specific advantage to customers to grab their attention. For example, they have not used beef in preparing their food just to encourage the beliefs of a large group living in the country. Another example is of targeting both the lower and the middle income group as their population is very high in the country. In doing so, the company has actually targeted a mass population (Gerhardt, Hazen and Lewis 2014). Another example is of differentiation in their foods, which they bring to satisfy the requirements of diverse customers across the globe. One of such examples is that they offered McRice to the Indonesian people (Zhang and Zhou 2012). The process of expansion had started in the year 1967. The company had first entered into Canada. By doing so, it actually followed the Uppsala model, which guides for a sequential expansion into the global market. McDonald is one of few such companies that have set trends for some useful strategies such as Franchising. The concept was very new to the fast food industry when McDonald took the full advantage of it and expanded into the United States. The company had used three methods to operate locally and expand to international markets. Those three methods are franchising, joint ventures and wholly owned outlets. The first franchising operation had started in the year 1953 with Arches Logo in Phoenix, USA. However, it has also used wholly owned outlet strategy depending on the external environment in the target market. They have adopted this technology in Mexico and the United Kingdom (Steenkamp 2014). The company has planned to refranchise approximately 4,000 restaurants. This wil l take their worldwide franchised percentage to around 93% (Forbes.com 2017). According to the Uppsala model, McDonald has constructed its international expansion in both the sequential and strategic mode. It first entered into Canada as it is very much close to the United States in terms of culture. Later on it moved to a little distinct society such as the European countries. At the very end, they moved to an entirely distinguish society such as the Middle East and the Asian countries (Sameer 2012). McDonald has used two strategies to expand into the international markets. Franchising and Wholly Owned Outlet are the two dominion concepts that the company had used. The dominion of these two factors encourages a fact that McDonald feels less secured with the Joint Venturing. However, it has still opted for joint venturing as it did in India and China (Zhang and Zhou 2012). Franchising has always remained a dominating strategy for McDonald; however, they have used a Wholly Owned concept in some parts of world such as Mexico and the UK. This has happened because the respective governments did allow franchising option (Abdelgawwad 2012). The dominion ride of McDonald has been challenged immensely by various local and international fast-food brands. The dominion has been challenged by many such as Starbucks, Subway, KFC and Burger King. The utmost competition from the rival companies and the changing perceptions of millennial customers has both contributed to a negative progression of the McDonalds business (Shen and Xiao 2014). The circumstances are very hard to displace; however, an alternative option can be taken to remain solid in the ever rising competition. It is recommended that the company should stick to what has helped it become the leading fast-food brand at the global platform. The setbacks have probably come from ample of changes in the menu that has been offered to the customers. It can be concluded that it is full of opportunity if a company wish to expand into the international market. On the other hand, the various international markets are also full of challenges. The fact has been clearly understood from the journey of McDonald Company. It is therefore advised to take cautious move and trusting the self-potential elements to remain competitive and selling in the market. References Abdelgawwad, M.A.A., 2012.Quality management: success and failure factors for new global product development in global quick service restaurants: a case study of McDonald's Egypt(Doctoral dissertation, Cardiff Metropolitan University). Badal, P.A., 2017. McDonalds Corporation-2015 (MCD). Budiman, A., Chhor, H., Razdan, R. and Sohoni, A., 2012. The new Indonesia consumer. Forbes.com. 2017.Forbes Welcome. 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