PROJECT REPORT ON FRANCISING OF MCDONALDS

INDEXSL. NO.TITLEPAGE NO.

1MCDONALDSan Introduction

3-4

2History of Mcdonalds & Key Landmarks - McDonalds India Journey

5-9

3Goals and Objectives, Mission Statement & Awards10-11

4Corporate Social Responsibility12

5McDonalds International & Business model

13-14

6Marketing Mix15-17

7SWOT Analysis18-19

8McDonalds Role in the Indian Economic Growth &Consolidated Balance Sheet of McDonalds

20-24

9People McDonalds # 1 Resource in India & The McDonalds Promise

25-27

10McDonalds India Culturally Sensitive & McDonalds Cold Chain in India

28-30

11Questionnaire & Survey Analysis

31-32

12The Top Five Reasons Why McDonalds is so Popular

33

13Findings34

14Conclusion

35

15Bibliography

36

MCDONALDSAN INTRODUCTION

McDonald's Corporation(NYSE:MCD) is the world's largest chain ofhamburgerfast food restaurants, serving around 68 million customers daily in 119 countries. Headquartered in the United States, the company began in 1940 as a barbecue restaurant operated byRichard and Maurice McDonald; in 1948 they reorganized their business as a hamburger stand using production lineprinciples. BusinessmanRay Krocjoined the company as a franchise agent in 1955. Ray Kroc subsequently purchased the chain from the McDonald brothers and oversaw its worldwide growth.

A McDonald's restaurant is operated either by afranchisee, or an affiliate, or the corporation itself. The corporation's revenues come from the rent, royalties and fees paid by the franchisees, as well as sales in company-operated restaurants.

McDonald's revenues grew 27 percent over the three years ending in 2007 to $22.8 billion, and 9 percent growth in operating income to $3.9 billion. McDonald's primarily sellshamburgers,cheese burgers, chicken,French fries,breakfastitems,soft drinks,milkshakes anddesserts. In response to changing consumer tastes, the company has expanded its menu to includesalads,wraps, smoothesand fruits.

An exterior view of theworld's largest McDonald's restaurant built on 2012 London Olympics site

In July 2011, McDonald's announced that their largest restaurant in the world will be built on the2012 London Olympicssite. The restaurant will contain over 1,500 seats and is half the length of an American Football field. Over 470 staff will be employed serving on average (during the 2012 Olympics) 100,000 portions of fries, 50,000 Big Macs and 30,000 Milkshakes. This restaurant will overshadow the current largest McDonald's in the world in Moscow, Russia. In January 2012, the company announced revenue for 2011 reached an all-time high of $27 billion, and that 2400 restaurants would be updated and 1300 new ones opened worldwide.

History of McDonald's

TheMcDonald'srestaurant concept was introduced inSan Bernardino, CaliforniabyDick and Mac McDonaldof Manchester, New Hampshire. It was modified and expanded by their business partner,Ray Kroc, ofOak Park, Illinois, who later bought out the business interests of the McDonald brothers in the concept and went on to foundMcDonald's Corporation.

McDonald's is the leading global foodservice retailer with more than 32,000 local restaurants serving more than 58 million people in around 130 countries each day. 70 percent of our restaurants worldwide are owned and operated by independent, local businessmen and businesswomen.

In India, the brand is managed by two business entities... Connaught Plaza Restaurants Private Limited, led by Mr. Vikram Bakshi, JV Partner and Managing Director, North & East India Hardcastle Restaurants Private Limited, led by Ms. Smita Jatia, Managing Director, South & West IndiaMcDonald's philosophy of QSCV (Quality, Service, Cleanliness and Value) is the guiding force behind its service to the customers in India. Following its philosophy of being sensitive to local food and cultural preferences, India was the first country in the McDonald's system where it served non-beef and non-pork products. More than 70 percent of the menu in India has been locally developed with complete segregation of vegetarian and non-vegetarian products right from the food processing plants to the point of serving the customers.

McDonald's commitment to its Indian customers is evident even in development of special sauces that use local spices and chillies. The mayonnaise and all other sauces are egg-less. McDonald's also pioneered the establishment of Cold Chain across India which helps maintain freshness and nutrition in every product.

McDonald's regular scrumptious menu includes wide range of products like McAloo Tikki, Filet-O-Fish, Spicy Range, Chicken McGrill, McVeggie, Veg Pizza McPuff, Chicken Mcnuggets, Fries, Wraps, an assortment of Sundaes, Soft Serve and refreshing beverages such as Ice Tea & Cold Coffee with outstanding service in a vibrant and lively ambience, for which McDonald's is known worldwide.

McDonald's had further reinforced the branded affordability mantra via the introduction of theHappy Price Menuwhich starts at Rs 25 only.

McAloo Tikki, Veg Surprise and Pizza McPuff developed in India are now being exported to the countries in the Middle East McDonalds introduced Cokes Georgia Gold range of hot beverages which was developed especially for the Indian market in 2002 As a leader in QSR segment (Quick Service Restaurant) McDonalds has pioneered various industry benchmark practices over the past decade of serving Indian customers, including new concepts such as Oil Alliances in India by inking with petroleum giants BPCL and HPCL. The two such alliances with BPCL outlets are in Mathura (2000) (UP) and Doraha (2002) (Punjab) Novel menu formats such as an Express Model with a limited menu and Kiosks with a variety of dessert offerings Home Delivery (McDelivery): Providing even more convenience to our customers. In Oct 2006, McDelivery on bicycle at Chandni Chowk was launched and in March 07 an all India single delivery number (66 000 666) was introduced First Drive Thru Restaurant at NOIDA (UP) in 1997 First Restaurant with operational Kitchen at Delhi Domestic.Keeping pace with the customer evolving needs McDonald's also functions on models that drive convenience and create unique differentiation like McDelivery, Drive thru, Breakfast Menu, high ways and extended hours. (Currently, available in select cities).At present, there are 300 McDonald's restaurants in India.

The strong foundation that Ray Kroc built... continues today with McDonald's vision and commitment for its internal as well as external customers. Since then, it has evolved into a value driven brand, and recognizes that affordability of its products is an attractive proposition for its customers along with taste. McDonald's continues to strengthen it business model and progress with customers evolving needs.

Key Landmarks - McDonalds India Journey

1996 the first McDonalds restaurant opened on Oct. 13, at Basant Lok, Vasant Vihar, New Delhi. It was also the first McDonalds restaurant in the world not serving beef on its menu

1997 the first Drive Thru restaurant at Noida (UP) the first disabled friendly store at Noida (UP)

1999the first Mall location restaurant at Ansal Plaza (New Delhi)

2000the first highway restaurant at Mathura (UP)

2001the first thematic restaurant at Connaught Place (New Delhi)

2002 The first restaurant in a food court at 3Cs, Lajpat Nagar (New Delhi) The first restaurant at the Delhi Metro Station at Inter State Bus Terminus The first fundraiser in association with ORBIS and Dr. Shroffs Charity Eye hospital.(Delhi)

2003... The first Dessert Kiosk Faridabad (Haryana)

2004 McDonalds Delivery Service (McDelivery) introduced in New Delhi

2003-04 Indigenous products like McAloo Tikki, McVeggie and Pizza McPuff exported to Middle East countries

2006 McDelivery on Bicycles flagged off at Chandni Chowk (Delhi)- another first initiative by McDonalds India 100th McDonalds Restaurant in India 10th Year Anniversary

2007 The first McDonalds open in Eastern Region at Park Street, Kolkata The first restaurant opened at Airport (Domestic Airport, New Delhi) The first MFY restaurant opened at Greater Noida, Uttar Pradesh

2008 The First restaurant to start extended hours procedure at Cyber Greens, Gurgaon and Saket, New Delhi The first restaurant to start Breakfast Menu at Janpath, New Delhi

2009The first McDonalds Restaurant opens at Old Delhi Railway Station

2010The first reimaged new look restaurant opened at Ambiance mall, Vasant Kunj 6

2011 McDonalds introduces premium products in it is menu McSpicy range of products McDonalds introduces Mcflurry (premium desserts) in Oreo and chocolate crispy flavors McDonalds introduces Wi-Fi across Delhi/NCR region

McDonalds currently has 235 restaurants in India

The Northern Region has 110 restaurants

Delhi 40 Haryana - 15 Faridabad 3, Manesar 2 (Highway and Drive - Thru), Gurgaon 7, Karnal 1 (Highway and Drive - Thru), Panipat -1, Ambala -1 Rajasthan -6: Jaipur 3, Jodhpur 1, Kota -1, Udaipur - 1 Uttaranchal -1: Dehradun 1 Uttar Pradesh 29: Noida 5, Greater Noida 1, Ghaziabad 7, Mathura 1 (Highway and Drive - Thru), Kanpur 2, Meerut 2, Lucknow 5, Agra 1, Allahabad 1, Varanasi -2, Gajraula 1 (Highway & Drive Thru), Khatauli - 1(Highway and Drive thru) Punjab 13 Chandigarh 2, Ludhiana 2, Doraha 1 (Highway and Drive - Thru), Jalandhar 2, Patarsi 1 (Highway and Drive - Thru). Dasuya (Highway and Drive Thru) 1, Amritsar -1, Patiala -1, Zirakpur-2 West Bengal-3: Kolkata- 3 Himachal Pradesh -1: Jabli-1 Madhya Pradesh -2 Gwalior 1, Bhopal -1

---------------------------------------------- The Western Region has 125 restaurants across the following states and cities

Maharashtra - Mumbai, Pune, Nasik, Kolhapur Gujarat - Ahmedabad, Vododara, Surat, Indore, Vapi Madhya Pradesh Indore Andhra Pradesh - Hyderabad Karnataka - Bangalore Tamil Nadu - Chennai

GOALS AND OBJECTIVES1. McDonalds vision is to be the worlds best quick service restaurants experience.2. McDonalds is committed to maintaining and developing the best food products in the quick service restaurant market.3. In order to deliver this, the company has made a number of commitments to food safety and nutrition.4. Lead the Quick Service Restaurant market by a program of site development and profitable restaurant openings, and by attracting new customers. Increasing sales through promotions will enable them to continue their program of expansion.

5. McDonalds have an objective to continual enhance and improve their menu. This will better satisfy their customers and give customers more reason to visit. Many ideas for new items on the menu come from the franchisees responding to customer demand. Consumer tastes change over time and McDonalds has to respond to these changes.

MISSION STATEMENT"McDonald's vision is to be the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile."

AWARDS

McDonalds India has received many prestigious awards for its service and performance including: The Most Respected Company for four consecutive years (2003-2006) in the Food Services sector, by Businessworld The Most Preferred Fast Food Outlet 2006 & 2007 by Awaaz Consumer Award hosted by CNBC Star Retailer the Consumer Way, Food Services Retailer of the Year 2006 & 2007, 2008 by Franchise India Retailer of the Year Award for catering services (2004-2006) at the Images Retail Awards The Amity Corporate Excellence Award in 2007 & 2008 The Most Wanted Brand of the Year Award 2003 & 2004 by Franchising Holdings India Ltd. The Most Admired F & B Retailer of the Year: QSRs Foreign Origin The Golden Spoon Awards by Images Retail The Company with the Best Corporate Conscience 2008 by Business & Economy Value for Money brand 2010 by Pitch Magazine The most trusted family restaurant brand in the country award in 2010 by Readers Digest

Corporate Social ResponsibilityBeing responsible is at the core of everything that we do at McDonald's. It is a deep-rooted value and a tradition that dates back to our founder Ray Kroc. It is also one of our top business priorities.

We believe that our continuing success depends on our stakeholders trust in each and every aspect of our business, be it the quality and safety of the food we serve; in the way we do our business; the way we connect and make the difference in the communities we operate; being sensitive to environment and being sustainable.1We are committed to doing what is right

2We are committed to be a good neighbour and partner in the community

3We are committed to conducting our business ethically and with complete transparency

4We are committed to treating our entire internal and external stakeholders with respect and dignity

McDonalds International

McDonalds has over 32,000 local restaurants in more than 100 countries 70 percent of our restaurants worldwide are owned and operated by independent, local businessmen and businesswomen McDonalds serves nearly 50 million customers each day McDonalds first franchised restaurant opened at Des Plaines, Illinois in 1955 by the founder Ray Kroc McDonalds has its own Hamburger University in Illinois, and the first batch graduated in 1961 12 classes offered at Hamburger University are college accredited In 1963, McDonalds sold its one billionth hamburger McDonalds is listed on the New York, Frankfurt, Munich, Paris and Tokyo stock exchanges McDonalds aired its first network TV advertisement McDonalds - Where Quality Starts Fresh Everyday, in 1965 The first McDonalds Drive-Thru opened in Sierra Vista, Arizona in 1975 Happy Meals were added to McDonalds menu in 1979 McDonalds launched the new worldwide Balanced Active Lifestyles public awareness campaign in 2005 McDonalds celebrated its 50th Anniversary on April 15, 2005

Business modelMcDonald's Corporation earns revenue as an investor in properties, a franchiser of restaurants, and an operator of restaurants. Approximately 15% of McDonald's restaurants are owned and operated by McDonald's Corporation directly. The remainder are operated by others through a variety of franchise agreements and joint ventures.The McDonald's Corporation'sbusiness modelis slightly different from that of most other fast-food chains. In addition to ordinaryfranchisefees and marketing fees, which are calculated as a percentage of sales, McDonald's may also collectrent, which may also be calculated on the basis of sales. As a condition of many franchise agreements, which vary by contract, age, country, and location, the Corporation may own or lease the properties on which McDonald's franchises are located. In most, if not all cases, the franchisee does not own the location of its restaurants.The United Kingdom and Ireland business model is different than the U.S, in that fewer than 30% of restaurants are franchised, with the majority under the ownership of the company. McDonald's trains its franchisees and others atHamburger UniversityinOak Brook,Illinois.In other countries, McDonald's restaurants are operated by joint ventures of McDonald's Corporation and other, local entities or governments.As a matter of policy, McDonald's does not make direct sales of food or materials to franchisees, instead organizing the supply of food and materials to restaurants through approved third party logistics operators.According toFast Food NationbyEric Schlosser, nearly one in eight workers in the U.S. have at some time been employed by McDonald's. It also states that McDonald's is the largest private operator of playgrounds in the U.S., as well as the single largest purchaser ofbeef,pork,potatoes, andapples. The selection of meats McDonald's uses varies with the culture of the host country.

MARKETING MIXThe marketing mix of a company consists of the various elements as follows which form the core of a companys marketing system and hence helps to achieve marketing objectives. The marketing mix of McDonalds is as follows:-The McDonald plains its marketing by simple keeping 4Ps in mind Product Price Promotion Place

Product: - McDonalds places considerable emphasis on developing a menu which customers want. Market research establishes exactly what this is. However, customers requirements change over time. In order to meet these changes, McDonalds has introduced new products and phased out old ones, and will continue to do so. Care is taken not to adversely affect the sales of one choice by introducing a new choice, which will cannibalise sales from the existing one (trade off). McDonalds knows that items on its menu will vary in popularity. Their ability to generate profits will vary at different points in their cycle. In India McDonalds has a diversified product range focussing more on the vegetarian products as most consumers in India are primarily vegetarian. The happy meal for the children is a great seller among others.Price:-The customers perception of value is an important determinant of the price charged. Customers draw their own mental picture of what a product is worth. A product is more than a physical item; it also has psychological connotations for the customer. The danger of using low price as a marketing tool is that the customer may feel that quality is being compromised. It is important when deciding on price to be fully aware of the brand and its integrity.In India McDonalds classifies its products into 2 categories namely the branded affordability (BA) and branded core value products (BCV). The BCV products mainly include the McVeggie and McChicken burgers that cost Rs 50-60and the BA products include McAloo tikki and Chicken McGrill burgers which cost Rs20-30. This has been done to satisfy consumers which different price perceptions.Promotion:- The promotions aspect of the marketing mix covers all types of marketing communications .One of the methods employed is advertising, Advertising is conducted on TV, radio, in cinema, online, using poster sites and in the press for example in newspapers and magazines. Other promotional methods include sales promotions, point of sale display, merchandising, direct mail, loyalty schemes, door drops, etc. The skill in marketing communications is to develop a campaign which uses several of these methods in a way that provides the most effective results. For example, TV advertising makes people aware of a food item and press advertising provides more detail. This may be supported by in-store promotions to get people to try the product and a collectable promotional device to encourage them to keep on buying the item.At McDonalds the prime focus is on targeting children. In happy meals too which are targeted at children small toys are given along with the meal. Apart from this, various schemes for winning prices by way of lucky draws and also scratch cards are given when an order is placed on the various mean combos.Place:- Place, as an element of the marketing mix, is not just about the physical location or distribution points for products. It encompasses the management of a range of processes involved in bringing products to the end consumer. McDonalds outlets are very evenly spread throughout the cities making them very accessible. Drive in and drive through options make McDonalds products further convenient to the consumers.

Other than the main four elements mentioned above there are a few other elements too in the marketing mix, which are as follows:-

People:-The employees in McDonalds have a standard uniform and McDonalds specially focuses on friendly and prompt service to its customers from their employees.Process:-The food manufacturing process at McDonalds is completely transparent i.e. the whole process is visible to the customers. In fact, the fast food joint allows its customers to view and judge the hygienic standards at McDonalds by allowing them to enter the area where the process takes place. The customers are invited to check the ingredients used in food.Physical evidence: - McDonalds focuses on clean and hygienic interiors of is outlets and at the same time the interiors are attractive and the fast food joint maintains a proper decorum at its joints.

SWOT ANALYSISStrengths McDonalds holds a very strong brand name worldwide.

They have large partnerships with other companies that provide them with their desired products; this increases the goodwill of the company.

McDonalds is one of the most reputed firms who are socially responsible.

Loyal employees & management & customer are their biggest strength.

McDonalds makes sure that cultural & regional barriers are kept in mind while providing food to different countries.

Clean environment and play areas for children where they can enjoy their time.

Weakness The weakness that hits the list of employee turnover rate. Every year many of their employees are fired out of the restaurant.

McDonalds mostly advertises products and food items that targets children.

Health conscious people often complain that they do not provide us with the organic and healthy food. This becomes their weakness when they get in the complaints.

They also face quality issue at times. This affects the business as they are running the outlet worldwide, if one franchise gets affected others also get a bad name. Opportunities

It can open up online services for their customers so that they can easily order their desired meals sitting at home.

Discounts given on every food item may help them gain more customers.

They can go for a joint venture with the retailers they work with.

They can introduce healthy hamburgers and healthy drinks for the people who are health conscious.

In order to be environment friendly, they can use packing material which can be recycled later or material that does not create pollution.

Threats

Emerging competition of similar outlets is becoming a problem for McDonalds.

Health issue also becomes a problem when it comes to food.

As it is a multinational food outlet, fluctuations in the currency of other countries becomes a problem for such companies.

Recession in any country would definitely affect the whole outlet worldwide.

People facing heart problems and obesity accuse McDonalds for not providing them with the healthy food.

They have a threat of local food outlets in different countries.

McDonalds is operating in a fully fledged economy where competition is increasing day by day therefore they should work effectively to overcome their drawbacks because of the recession.

McDonalds Role in the Indian Economic Growth

In 1990, six years before the opening of the first McDonald's restaurant in India, McDonalds and its international supplier partners worked together with local Indian companies to develop products that meet McDonald's vigorous quality standards. These standards also strictly adhere to Indian Government regulations on food, health and hygiene. Part of this development has involved the transfer of state-of-the-art food processing technology, which has enabled Indian businesses to grow by improving their ability to compete in today's international markets.

Prior to McDonalds arrival in India, the concept of a Cold Chain for the distribution of food and dairy products from the farm to the end supplier in predetermined and stringently enforced climactic and hygienic conditions was at a very nascent stage of development. For five years prior to opening the first restaurant, McDonalds pioneered the effort to develop this aforementioned Cold Chain so that trademarked high standards would be assured. This concept has today been adopted by various Indian and International players to deliver quality produce to consumers.

For instance, Cremica Industries worked with another McDonald's supplier from Europe to develop technology and expertise, which allowed Cremica to expand its business from baking to also providing breading and batters to McDonald's India and other companies. Another benefit is expertise in the areas of agriculture, which allowed McDonalds, and its suppliers to work with farmers in Ooty, Pune, Dehradun and other regions to cultivate high quality Iceberg lettuce. This includes sharing advanced agricultural technology and expertise like utilization of drip irrigation systems, which reduce overall water consumption, better seeds & agricultural management practices, which result in greater yields.

In some cases, these Indian suppliers had the technology - but no market for the products they produced. For example, Dynamix Dairies - through its relationship with McDonald's - was introduced to a large customer of milk casein and other milk derivatives. McDonald's local supply networks through Radhakrishna Foodland, to get products from the various suppliers to restaurants across India.

McDonalds North India alone contributes Rs.30.7crore (USD 7.76 million)/annum approximately as sales tax to different State Governments where we have our operations.

COMPANYS FINANCIAL INFORMATIONCompany Name:McDonald's Corporation

Ticker Symbol:MCD

Web Address:www.mcdonalds.com

CEO:Mr. Donald Thompson

No. of Employees:420,000

Common Issue Type:CS

Business Description:McDonald's Corporation franchises and operates McDonald's restaurants in the food service industry. The Company and its franchisees purchase food, packaging, equipment and other goods from numerous independent suppliers.

Industry Information:LEISURE -Restaurants

PriceDay ChangeBidAskOpenHighLowVolume

87.18-0.02--87.4387.4386.763658828

Market Cap (mil)Shares Outstanding (mil)BetaEPSDPSP/EYield52-Wks-Range

87,526.71,004.00.395.272.5316.43.5102.22 - 83.31

KEY FIGURES (Latest Twelve Months - LTM)

Yesterday's Close87.06$

PE Ratio - LTM16.4

Market Capitalisation87,526.7mil

Latest Shares Outstanding1,004.0mil

Earnings pS (EPS)5.27$

Dividend pS (DPS)2.53

Dividend Yield3.5%

Dividend Payout Ratio48%

Revenue per Employee64,300$

Effective Tax Rate31.3%

Float1,015.3mil

Float as % of Shares Outstanding99.9%

Foreign Sales18,478mil

Domestic Sales8,528mil

Selling, General & Adm/tive (SG&A) as % of Revenue9.10%

Research & Devlopment (R&D) as % of Revenue0.00%

Gross Profit Margin44.7%

EBITDA Margin35.6%

Pre-Tax Profit Margin29.1%

Assets Turnover0.8%

Return on Assets (ROA)16.1%

Return on Equity (ROE)39.2%

Return on Capital Invested (ROCI)20.4%

Current Ratio1.0

Leverage Ratio (Assets/Equity)2.4

Interest Cover16.6

Total Debt/Equity (Gearing Ratio)0.96

LT Debt/Total Capital48.0%

Working Capital pS0.06$

Cash pS2.17$

Book-Value pS13.83$

Tangible Book-Value pS11.10$

Cash Flow pS6.89$

Free Cash Flow pS1.25$

KEY FIGURES (LTM): Price info

Price/Book Ratio6.30

Price/Tangible Book Ratio7.85

Price/Cash Flow12.6

Price/Free Cash Flow69.9

P/E as % of Industry Group42.0%

P/E as % of Sector Segment77.0%

Balance Sheet (at a glance) in Millions

DIVIDEND INFO

Dividend Declared Date09/20/2012

Dividend Ex-Date11/28/2012

Dividend Record Date12/02/2012

Dividend Pay Date12/16/2012

Dividend Amount770

Type of PaymentCash Payment

Dividend Rate3.08

Current Dividend Yield3.5

5-Y Average Dividend Yield3.1

Payout Ratio48.0

5-Y Average Payout Ratio53.0

Share price performance previous 3 years

Share price performance intraday

PRICE/VOLUMEHighLowClose% Price Chg% Price Chg vs. Mkt.Avg. Daily VolTotal Vol

1 Week---0.010154,04166,217

4 Weeks87.4383.3184.742.710157,129856,929

13 Weeks94.1683.3191.02-4.49861,2883,554,700

26 Weeks94.1683.3187.75-0.89359,4197,189,758

52 Weeks102.2283.3198.03-11.27959,27214,521,666

YTD102.2283.31--13.27759,77413,807,695

Moving Average5-Days10-Days10-Weeks30-Weeks200-DaysBeta (60-Mnth)Beta (36-Mnth)

86.6186.3188.2589.3191.740.390.31

GROWTH RATES5-YearGrowhR of 5-Year Growth3-YearGrowth

Revenue3.8177.66.66

Income20.1781.19.78

Dividend15.3694.710.16

Capital Spending6.97NA10.52

R&D0.00NA0.00

Normalized Inc.11.58NA9.79

CHANGESYTD vs.Last YTDCurr Qtr vs.Qtr 1-Yr agoAnnual vs.Last Annual

Revenue %2.1-0.212.2

Earnings %-1.4-3.511.3

EPS %1.0-1.415.1

EPS $0.04-0.020.69

SOLVENCY RATIOS

SHORT-TERM SOLVENCY RATIOS (LIQUIDITY)

Net Working Capital Ratio2.71

Current Ratio1.3

Quick Ratio (Acid Test)1.0

Liquidity Ratio (Cash)0.67

Receivables Turnover21.5

Average Collection Period17

Working Capital/Equity6.2

Working Capital pS0.88

Cash-Flow pS6.77

Free Cash-Flow pS2.09

FINANCIAL STRUCTURE RATIOS

Altman's Z-Score Ratio4.85

Financial Leverage Ratio (Assets/Equity)2.3

Debt Ratio56.4

Total Debt/Equity (Gearing Ratio)0.87

LT Debt/Equity0.84

LT Debt/Capital Invested56.9

LT Debt/Total Liabilities65.2

Interest Cover17.3

Interest/Capital Invested1.67

People McDonalds # 1 Resource in India

McDonald's India is an employer of opportunity, providing quality employment and long-term careers to the Indian people. A McDonald's restaurant employs around 50 people on an average, performing 25 different job responsibilities - from the counter crew to the restaurant manager. Starting with 50 employees in 1996, McDonalds world-class training inputs to its employees can today be seen in close to 10.000+ employees currently employed directly with McDonald's restaurants across India. Additional indirect employment contributes to over 2000 people (Suppliers /service agents etc.)

The training centers at Delhi & Mumbai provide world-class training to every employee. It is ensured that each employee who has undergone an extensive training program is judged at the end of every course involving assessment at regular intervals. Some of the courses are the Basic Shift Management Course (BSM), Advance Shift Management Course (ASM), Effective Management Practices Course (EMP) and candidates who were till now attending the Restaurant Leadership Practices Course (RLP) in Australia can now do the same, here in India with the support of McDonalds Hamburger University.

The McDonalds PromiseQUALITY, SERVICE, CLEANLINESS & VALUE When asked to explain McDonald's success, founder Ray Kroc used to say, "We take the hamburger business more seriously than anyone else." Kroc was a perfectionist. From the day he opened his first restaurant, he vowed to give his customers high quality products, served quickly --and with a smile, in a clean and pleasant environment, and all at a fair price. Quality, Service, Cleanliness and Value (QSC&V) became the philosophy that drove McDonald's business. QUALITY McDonald's India serves only the highest quality products. The attention to food quality started long before the first restaurant opened. McDonald's India has established close relationships with local suppliers who provide McDonald's with the highest quality, freshest ingredients to make its products. All suppliers adhere to Indian government regulations on food, health and hygiene while continuously maintaining McDonald's own recognized standards. McDonald's has established an extensive "cold chain" distribution system in India to ensure that the products, which arrive at the restaurant from suppliers all over India, are absolutely fresh. In the restaurants, products and supplies are used on a "first-in, first-out" basis to ensure freshness. All McDonald's products are prepared using modern, state-of-the-art cooking equipment to ensure quality and safety. SERVICE McDonald's India provides fast, friendly service -- the hallmark of McDonalds, which sets its restaurants apart from others. At McDonald's, the customer always comes first. Every employee strives to provide 100 percent customer satisfaction -- for every customer -- every visit. This includes friendly and attentive service, accuracy in order taking, and anticipation of customer's needs -- such as napkins or straws. The McDonalds promise is With a sense of fun and youthful spirit, we will proudly serve an exceptional McDonalds eating experience that makes all people feel special and makes them smile every customer, every time.

CLEANLINESS McDonald's restaurants provide a clean, comfortable environment especially suited for families. McDonald's stringent cleaning standards ensure that all tables, seating, highchairs and trays are sanitized several times each hour. The attention to cleanliness extends from the lobby to the kitchen to the sidewalk and immediate areas outside the restaurant. In addition to urging customers to dispose of their litter properly and offering a number of trash bins (both inside and outside the restaurants) for their convenience, McDonald's "Litter Patrols" walk around the restaurants several times each day picking up litter -- even if it isn't from McDonald's. Restaurant managers walk through the dining areas each hour, to ensure that it is clean and well stocked. All restaurants provide a variety of comfortable seating arrangements to accommodate anyone -- from a single individual to a large family. The environment is warm, inviting, and well lit. VALUE McDonald's menu is priced at a value that the largest segment of Indian consumers can afford. McDonald's does not sacrifice quality for value -- rather McDonald's leverages economies of scale to minimize costs while maximizing value to customers. McDonald's definition of value is broader than most restaurants of its kind -- it is more than price. Value at McDonald's is the sum of the total McDonald's experience: quality food; fast, friendly service; a clean and pleasant environment, and products priced at very affordable prices for the largest segment of Indian consumers possible. That is value at McDonald's. McDonalds India Culturally Sensitive

Indianisation of Menu

With the opening of the first McDonalds restaurants in India- there is much that is consistent with other McDonalds restaurants around the world, such as the quality of the food and the attention to service.

The dedication to local cultures is not new for McDonalds. For the past 50 years, McDonalds has opened restaurants in more than 120 distinctly different countries and cultures. With guidance from its local partners, McDonalds is able to adapt- where necessary-its menu and restaurant operations to complement existing eating-out options. McDonalds local owners understand what their customers want perhaps more importantly, what is acceptable within local customs and values.

There is much, too, that is very different- such as the first beef-less and pork-less menu in the world and special product formulations to cater to Indian culture and palate. Vikram Bakshi, the joint venture partner for McDonalds India, says We know the Indian culture, because we were born in it, inherited its richness, and respect it greatly. It is the respect for this culture and the sentiments of many of our customers, that we do not serve any beef and pork items in our restaurants.

McDonalds commitment to its Indian customers is evident even in development of special sauces that use local spices and chillies. The mayonnaise and all other sauces are egg-less.

In India, vegetarianism is in many cases more than a lifestyle choice. Many people are vegetarians due to religious reasons, and in some cases even the vegetarian product that has come into contact with a non-vegetarian product is unacceptable. Hence, McDonalds India has also changed its operations to address the special requirements of our vegetarian customers by having processes that ensure that a physical separation of veg and non-veg products is maintained right from farm to the customer. Vegetable products are prepared separately, using dedicated equipment and utensils. Also in India, McDonalds uses only vegetable oil as a medium for cooking.

McDonalds Cold Chain in India

McDonald's India is characterized by a unique sense of dedication and commitment to be driven by the leadership of local owners. This commitment has translated into enduring benefits to the businesses at the grass root level, in the areas of introduction of new crops, new agricultural practices and food processing methods and procedures.

McDonald's unique 'cold chain', on which the QSR major has spent more than six years setting up in India, has brought about a veritable revolution, immensely benefiting the farmers at one end and enabling customers at retail counters get the highest quality food products, absolutely fresh and at great value.

Setting up this extensive cold chain distribution system has involved the transfer of state-of-the-art food processing technology by McDonald's and its international suppliers to pioneering Indian enterprises, which are today an integral part of the McDonalds cold chain.

From Field to -2C in 90 Minutes Trikaya Agriculture, a major supplier of iceberg lettuce to McDonald's India, is one such enterprise that is an intrinsic part of the cold chain. Initially lettuce could only be grown during the winter months but with McDonald's expertise in the area of agriculture they are now able to grow this crop through the year.

Post harvest facilities at Trikaya include a cold chain consisting of a pre-cooling room to remove field heat, a large cold room and a refrigerated van for transportation where the temperature and the relative humidity of the crop is maintained between 1 C and 4 C and 95 per cent respectively. Vegetables are moved into the pre-cooling room within half an hour of harvesting. The pre-cooling room ensures rapid vacuum cooling to 2 C within 90 minutes. The pack house, pre-cooling and cold room are located at the farms itself, ensuring no delay between harvesting, pre-cooling, packaging and cold storage.

Trikaya is not associated with us any longer and iceberg lettuce is now locally sourced from our partners Vista Processed Foods Pvt. Ltd

Flavour and Freshness locked in at - 35C Vista Processed Foods Pvt. Ltd., McDonald's suppliers for the chicken and vegetable range of products, is another important player in this cold chain. This includes hi-tech refrigeration plants for manufacture of frozen food at temperatures as low as - 35 C. This is vital to ensure that the frozen food retains it freshness for a long time and the 'cold chain' is maintained. The frozen product is immediately moved to cold storage rooms. Our Backbone: Cold Chain & Suppliers

McDonalds Cold Chain In India

From Farm to Bulk Cooler in less than 90 Minutes

McDonald's suppliers of cheese, Dynamix Dairy, too, recognizing the need for quality milk to make quality cheese, has set up a dedicated quality program for milk procurement. They have made significant investments in setting up bulk coolers at all milk collection centres in the Baramati area, where they are based. On receipt, the milk is immediately stored in the bulk coolers at the collection centres, to prevent growth of bacteria in the milk and preserve its freshness - thus, maintaining the 'cold chain'.

All leading to the Consumer

McDonald's local supply networks through Radhakrishna Foodland, which operates distribution centres (DCs) for McDonald's restaurants across India. The DCs have focused all their resources to meet McDonald's expectation of 'Cold, Clean, and On-Time Delivery' and plays a vital role in maintaining the integrity of the products throughout the entire 'cold chain'.

Ranging from liquid products coming from Punjab to lettuce from Pune, the DC receives items from different parts of the country. These items are stored in rooms with different temperature zones and are finally dispatched to the McDonald's restaurants on the basis of their requirements. The company has both cold and dry storage facilities with capability to store products up to -22 C as well as delivery trucks to transport products at temperatures ranging from room temperature to frozen state.

All these suppliers share McDonald's commitment and dedication to satisfying customers by supplying them the highest quality products. They are working cohesively to ensure that the final product reaches the customer consistently each time and every time. At their level, every care is taken to guard against any interruptions in the cold chain, which can break the link and have a detrimental effect on the quality of the product. And more products reaching the market fresher and quicker not only benefit the economy but also help the farmer earn more.

QUESTIONNAIRE 1. How often do you visit fast food restaurants?Everyday Alternate days Weekends Once in a month Once every three months

2. Which of the following fast food chain do you visit the most? Subway McDonalds KFC Pizza Hut Burger King

3. Are you satisfied with the services provided by them Yes Sometimes Not at all satisfied

4. How often do you eat at McDonalds? Everyday Alternate days Weekends Once in a month Once every three months

5. Which among the following is your favourite product at McDonalds?Big Mac Burger Mac Veggie Big Mac Chicken Burger Maharaja Mac Mac Fileto Fish

6. Is the product line of McDonalds adequate?Yes No Havent Thought About That

7. What time of the day do you prefer to eat at McDonalds?Morning Noon Evening Night

8. What is the main problem you faced at McDonalds?Long queues Wrong orders Hygienic problems Other problems No problems

9. What are the unique selling prepositions of McDonalds?Product variety Hygiene Ambience Quick service Location Other

10. Do you think McDonalds will be triumphant over all its competitors?Yes Maybe Havent Thought About That Never Thank You!!

SURVEY RESPONSE ANALYSIS

THE TOP FIVE REASONS WHY MCDONALDS IS SO POPULAR1. The SystemThis is the first thing that makes McDonald's so successful, by having an effective and efficient system in place, which exploits the minimum wage labour available, in the form of young teenagers who are just looking to make some cash or pick up fundamental job skills.

2. ConvenienceThe second reason why McDonald's is so popular is because it's everywhere. There a McDonald's at every corner of the map, at every major shopping centre, district, highway, freeway, every place which attracts even, remotely more than 10 people, will have a McDonald's restaurantnot too far from them.McDonald's is having the best Real Estatelocationsaround the world which makes it so popular around the globe.

3. Likability and Familiarity The Golden Arches, the Big M. Ronald McDonald, happiness and fun; all these are the associations with McDonalds which makes it so familiar by being so familiar to all age groups and to everybody.

4. The MenuMcDonald's has one of the most diverse menus, targeting all ages from little kids to old pensioners, and everyone else in between. There's Big Macs for the big kids and junior burgers for the little. The menu's versatilityis accentuated when they introduced the "healthy tick" concept, which target those people who wants to watch whatthey eat(even though it doesn't make sense to go to afast food restaurantto eat healthy).

5. Consistency The last reason is, McDonald's is so successful because of its consistency. The expectations that we have about everything surrounding the store are fulfilled in almost every store nationwide, worldwide.So everybody knows what they're getting into before they come to McDonald's, and by being so consistent, it has a solid reputation to uphold.

Findings

At McDonalds, the corporate culture and management system are strictly imposed, detailed operating manuals followed tothe letter and an extensive field organization checks on each store to enforce standards.

The organizational development focused upon generating revenues from the existing operations.

They give different trainings to their employees/ managers to work in more productive way, and to achieve the goals of the organisation.

The domestic growth has slowed as a result ofmarket saturation but McDonalds global foodservice business delivered good results, and was possible only due to expansion and positive comparablesales.

McDonald's develop a deep connection between McDonalds and the local communities inwhich itoperates.

McDonald's believes that the success of the restaurants and the company is achieved through the people it employs.

The company aims to recruit the best people, to retain them by offering ongoing training relevant to their position and to promote them whenthey areready.

CONCLUSION

What started as a simple food stand on Huntington drive, California in 1937, through the ages have become a billion Dollar corporation and the worlds second largest fast-food chain. When analysed, one would understand that McDonalds had a stable growth in the past years.The credits of building it into one of worlds largest fast food operation can be given to Ray Kroc who took over McDonalds from its establishers, modernised and expanded it to suit the contemporary trend. Today McDonalds has a net worth of $15.15 billion.Through this project report and market survey we saw the how McDonalds was formed, its history and the present position. We also its list of various products offered and the corporate profile. Through the marketing mix, we saw how they make use of their product, price, place, promotion mixes. SWOT analysis showed us the strengths and weakness of McDonalds as well as the opportunities and threats they have got. The consolidated financial statement showed us the financial position of the corporation as of 2011. The questionnaire survey provided us with a clear picture of the needs, want and expectations of the consumers of the fast food market in general and McDonalds in particular. The respondents also rated the services provided by the corporation. At last we also saw the top five reasons that make McDonalds so popular.I gladly hope that this project has met its aim.Let me conclude by quoting this quote by Ray Kroc "Perfection is very difficult to achieve, and perfection was what I wanted in McDonald's. Everything else was secondary for me."

BIBLIOGRAPHY

www.google.com

www.wikipedia.org

www.macdonalds.com

www.marketing91.com

www.aboutmacdonalds.com

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