The paper 'Business in the Business Environment' is a wonderful example of a Business Case Study. Mc Donald’ s Corporation is regarded as the World’ s largest fast-food restaurant chain of hamburger. It serves around 68 million people daily in 119 countries. Brothers Maurice and Richard McDonald began the company in 1940 and it has maintained being headquartered in the United States. In 1955, a businessperson, Ray Kroc, joined the company and subsequently bought it to oversee its growth. In its organization worldwide, it has operated as an affiliate, franchise, or the corporation itself (Mc Donald's 2013; Jurevicius 2013 ).
The company primarily sells cheeseburgers, French fries, hamburgers, chicken, breakfast items, milkshakes, soft drinks, and deserts. However, as the consumer demands keep on expanding, it has responded by introducing fish, wraps, salads, smoothies, and fruits. The company has continued to obtain its revenue through royalties, fees, rent, and sales from its products. In the year 2012, it reported an annual revenue of $27.5 billion with net earnings of $ 5.5 billion. PESTLE Analysis Pestle (political, economical, social-cultural, technological, and legal factors) analysis is the analysis of the external/ macro-environment in which the business firm operates. Political Factors Taking in mind that Mc Donald is an international business with many branches, affiliates, and franchises abroad, its operations will highly be influenced by individual country’ s policies.
For instance, as the clamor of fast foods’ implication on the health statuses of individuals keeps on rising, its product demand is likely to be affected. There are indications that the company’ s products harbor harmful elements like cholesterol and other fats that are attributable to adverse health effects like obesity ( Zhou and Zhang 2012).
In some specific market focus, the company has been caught struggling to obtain licenses in some states where it is seen as infringing the law. This has been seen in India whose operation has been regarded as offensive to the Hindu religion. The company is also obliged to fulfill its employment and tax obligations in foreign markets. As Shin notes, the company’ s remuneration seems to be ‘ heartless’ . Its minimum wage is too low, which may ignite political debates against it (2013). As a matter of analysis, since the company has kept pace with the continuous expansion in demand for its products, it is essential that it consider dealing directly with proper authorities in the market area in which it intends to operate.
This means that it rests on the good graces of government authorities in the countries in which it intends to open a business. This will imply that it accomplishes every individual country’ s prerequisites to the level of satisfaction before starting operations. The Corporation must also adhere to laws, order, and fulfill its responsibilities to avoid any likely liabilities.
As regards employees, the company should ensure its workers are protected through quality hiring, training, and compensation, basing on each country’ s employment law. Economic factors As already mentioned, the company’ s affiliates, branches, and franchises will continue to face hardship especially in the countries where they operate. Therefore, these will in turn influence consumer response to the products. Exchange rates will also have an effect if it tends to import raw materials from one country to another. According to US Today (2012), the company reported that economic volatility that was being experienced around the world could result in raised expenses and therefore pressuring up the profit results.
In 2012, its share went down by 1.3%. This is because, due to economic hardships in areas such as the Middle East, Asia Pacific and Africa, the company’ s sales went down by 1.7% (Shin, L 2013), In China country, its sells remarkably went down because of the dinner promotion that was occurring there. However, in Europe, its performances were profoundly well. The sales there, which had been driven majorly by new gains in Russia, the United Kingdom, and France, rose by 2.9%.
Although economically, the company has continued to outshine its rivals, more firms that are similar continue to expand their areas of operations and hence new markets (Jurevicius, J 2013), However, for more good news, the company expects to experience worldwide ease in inflation of food supplies, which analysts rely on to, predict bright future. As they have noted, most of McDonald’ s sales occur outside the US, in emerging markets that are growing very fast like Russia, India, China, and Eastern Europe.
By tapping into a strong middle class, the company is expected to post strong financials.
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< http://www.forbes.com/sites/artcarden/2013/07/30/would-a-higher-minimum-wage- help-mcdonalds-workers/>
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