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competitive advantage of kfc and mcdonald's

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To run a major fast food chain, you need to ensure regular supply of good quality raw materials. Having become the largest restaurant in Asia in 2014, Jollibee will have to face off against the likes of Starbucks, Yum! United States are the largest market for McDonalds accounting for more than 30% of the companys revenue. This allows them to provide a superior experience to their customers. Their weaknesses include their high level of debt and their reliance on a small number of key suppliers. According to Michael Porter, there are three different way to sustain a competitive advantage. Environmental Leader 2009, KFC Switches to Earth Friendly Packaging. KFCs sources of competitive advantage. For instance, both organisations are immensely concerned with their environmental impacts. In 1987, it was amongst the first western-based organisations that opened new business branches in China. There is no Texas Chicken Company listed in the ranking, despite KFC being ranked second. McDonalds Business Strategy and Competitive Advantage. . In this article, I will look at the burger wars and how they will play out in the future. They also have to factor in the quality of their hamburgers in order to keep prices low in comparison to their competitors. McDonalds has always tried to achieve higher customer satisfaction. People prefer to go out to a McDonalds or Wendys grab some food and eat that instead of eating a home cooked meal at the dinner table. And in doing so, it reduces a lot of its risk, both in the short and long term. IvyPanda. Meanwhile, McDonalds has provided more healthy meal and also vegetarian meals compare to KFC such as McVeggie, apple pie, and spinach pie but KFC and Texas Chicken only provide salads. This claim means that apart from the need to serve their own interest and the interest of the owners, McDonalds and KFC have to deploy the adopted supply chain management approaches to demonstrate their concern to the protection and preservation of the environment within which they are established. If youre the first to try something new or to address the spotted need, youll get better results. If you need this sample, insert an email and we'll deliver it to you. Similar to McDonalds, the organisation also follows the franchising model of operation. Texas Chicken have branches more than 1,700 locations worldwide in 23 countries. Other issues that have been considered in the paper in relation to sustainability of McDonalds and KFC supply chains include effects of strategies of supply chain on the environment, especially with reference to the need to produce green products to ensure protection of the environment. The company cares about the health of its customers. Aggressive food service competitors threaten McDonalds and impose a major strategic challenge in this SWOT analysis. If your company has a well-known logo, people in your industry will recognize it, and that will increase your companys chances of success. The rivalry between McDonalds and Burger King is a classic example of business. The joint venture that has been going on for over fifty years. For take-away foods, they must wrap customers food. Leveraging scale, supply chain infrastructure and risk management strategies, it also collaborates with its suppliers for achieving competitive, predictable food and paper costs over the long term (McDonalds Annual Report 2017). Since an organisation must balance all interests of the stakeholders, owners of the corporations become disadvantaged since high operational costs imply low returns on investments. Finally, McDonalds has a presence in over 100 countries, making it one of the most ubiquitous restaurant brands in the world. The most preferred direction is the one that will ensure that supply chain approaches become cost effective to the extent of making an organisation experience competitive advantage. KFC positions itself competitively by leveraging on franchising. The fast-food industry is highly competitive and it is important that both McDonalds and KFC continue to use marketing to stay ahead of their competitors. In the United States, McDonalds has a 42% share of the fast-food hamburger market. The QSR industry has grown and is populated by a very large number So KFCs core competencies are its ability to leverage, exploit, take advantage of its recipe and its brand name. McDonalds is the worlds most valuable fast food brand, with a market value of $124 billion. McDonalds sells a wide variety of food. Quality, service and cleanliness are always important, but in this case, good value is more important. In its mission statement, McDonalds states that it focuses on people as most important resources that are available to enhance the success of its business objectives and goals (Wilhelm 2011). This strategy is formulated to ensure that McDonalds creates customer experiences that are consistent across all franchises and the company-owned stores. 1, pp. The significance of these strategies in relation to sustainable supply chain is pegged on the idea that the most significant strategies for supply chains are the ones that translate into low costs to an organisation and in terms of social costs. McDonalds is popular for its hamburgers. When McDonalds restaurants see donations in boxes, they collect the donations and give away the donations to Ronald McDonald Houses to help children with serious illnesses. Through continual innovation & technology research and upgrade, McDonalds have transformed itself from a small bar-b-que restaurant to a fast food restaurant chain serving mainly burgers, chicken products, fries, beverages, desserts, salads, wraps and fruits for breakfast, lunch, dinner and even supper 24 hours a day, 7 days a week. There are several major international fast food brands including Dominos, KFC, Burger King, SubWay, Wendys and similar more that are competing for market share with McDonalds. With great customer service and a great community service department, McDonalds remains a leader in communities all over the world. McDonalds worldwide serves 6.5 million burgers per day or 75 burgers per second. Global presence has led to higher sales and revenue for the brand. You can use them for inspiration, an insight into a particular topic, a handy source of reference, or even just as a template of a certain type of paper. KFC is not the only fast food chain in competition with KFC; there are also competitors such as Popeyes Louisiana Kitchen, McDonalds, Wendys, and Jack in the Box. professional specifically for you? This immense success of McDonalds is attributed to a number of factors such as its incredible emphasis on engagement of consumers, appropriate leaderships that fits the business of the organisation, and exceptional investments of the organisational resources in brand management. (2021) 'McDonald's and KFC Corporate Responsibility'. 2, pp.117-127. McDonalds was ranked in number one in the analysis of Top 10 Fast food Largest Fast Food Chains In The World. Next, is the their Menu. It has managed its supply chain well which helps it ensure continuous supply of good quality raw material and hygienic food for its customers. This is correct. 2 no.1, pp. They have a value chain that allows them to compete with other fast food chains while still providing their customers with excellent service. However, it leads to added costs, which attract low profitability. While McDs mainly serves a uniform menu globally with no substantial variations except for small regional ones, its menu is still quite large and diversified. KFC China tends to introduce more new products than its competitors (Jeon et al. Compare both KFC and Texas Chicken in perspective of balance meals, they are same. Maloni, M. & Brown, E. 2006, Corporate Social Responsibility in the Supply Chain: An Application in the Food Industry, Journal of Business Ethics, vol. "McDonald's and KFC Corporate Responsibility." Need a custom Assessment sample written from scratch by McDonald's Competitive Advantage. From the perspectives of deferential strategy, organisations seek to supply unique products in any industry. Products enable a company to differentiate itself from competitors and gain competitive advantage. 40 no.15, pp. Competition in the fast food industry has grown intense due to the rise of several local and international brands. IvyPanda, 2 Aug. 2021, ivypanda.com/essays/mcdonalds-and-kfc-corporate-responsibility/. Falling 5.04 KCALs behind McDonalds, the fried chicken chain KFC reaches 376.67 KCALS per serving. KFC ranks fourth among all companies in terms of its Diversity Score, which is given to employees. How is KFC positioning itself to gain a rival edge over? 1 What are the competitive advantages of KFC? Web. Although both chains have their own characteristics, they are widely regarded as the two most competitive in the fast food industry. McDonalds brand value is unrivaled among its competitors in terms of brand value. McDonalds and KFC are two of the most prominent fast food chains cherished by numerous around the globe. McDonalds has been trying to get into the breakfast market for sometime, but they have come under criticism about their treatment of their workers. The number of baby boomer customers of McDonalds is also large. Indeed, competitive advantage is one of the supply chain management strategies that act as critical success factors for sustainability in any organisation, The human mouth craves those flavors and that is what makes you go back for more KFC.. The two largest fast-food companies have competed fiercely for market share since the 1950s. They want their food to be good in terms of quality and low on calories. According to these rankings, neither of these chains has achieved gender equality yet, but they are making headway. Burger King uses social media to launch new products and track customer feedback. An effective supply chain arm of an organisation ensures that products and services are availed just whenever they are required in a manner that will ensure that the increasing number of products that need to be availed in the market is sustainable (Bakshi & Fiksel 2010). Sustainability in supply chain management can be enhanced through programmed inter-supplier communication strategies. Other strategies include focusing on developing healthy meals. One of McDonalds competitive advantages is its focus on consistency of quality, production of food and use of raw materials all around the world. Competitive Advantage offers a beneficial position to business organisations over rivals in regards of some measure like expense, quality, or velocity. 2) confirms, Cheap food comes with steep hidden costs to the people who produce it, sell it, and eat it, to the environment, and to future generations. Can KFC and McDonalds operate sustainably? From the perspective of balance meals, KFC did a better work than McDonalds because their meal has more protein, carbohydrates, and vegetables. For instance, KFC have chickens come with whipped potatoes, salads, buns and soft drink but McDonalds have fried chickens with French fries and soft drink only in both fried chicken set. For example, while McDonalds and Burger King both sell burgers, McDonalds offers a Big Mac while Burger King offers a Whopper. Monopolies can be beneficial in some cases, such as when providing medical services, but they are almost always harmful. Choose your writer among 300 professionals! Differentiating between the two will help obtain the best out of the products that the two brands offer their customers. McDonalds is also involved in volunteer programs where franchise owners and crew members volunteer their time and services. It allows you to develop a clear and concise plan for how to best compete against them. McDonalds adapted to future trends by allowing touchscreens to be used to select the menu from or introducing a vegetarian option to the menu. Retrieved from https://ivypanda.com/essays/mcdonalds-and-kfc-corporate-responsibility/. Hence, inclusion of the product is a further indication of the companys flexibility to meet the need of its customers. Over the long term, McDs aims to manage 95% of the restaurants in its system through franchisees. KFC is ranked fourth in the world in terms of gender score, while Taco Bell is ranked 130th. Both McDonalds and KFC supply chains experience several issues, which make it difficult to enhance their sustainability. The company has a 60% share of the global fast-food hamburger market. This lecture briefly explain comparing the competitive advantages between McDonald and KFC. He further asserts that it has incredibly lagged behind in terms of mass communication of its plans for enhancing sustainable supplies by investing in CSR. Besides the national restaurants, there are other western fast-food organisations like Burger King and KFC that pose tough competition to McDonalds by offering similar product lines. Indeed, its founder, Harland Sanders, realised that the organisation would function under this model in 1952 when he opened the first franchise at Utah. It asserts that these parties hardly inquired about sustainability or even talked about it (Idle 2011). Cheeseman, G. 2013, Can the Fast Food Industry Ever Be Sustainable. Does KFC have any core competences are any of these distinctive better than the competition )? Guaranteeing sustainable supply chains calls for the deployment of a number of principles. Additionally, McDonalds customer service standards are among the highest in the fast food industry. KFCs success can be attributed to its distinct brand name and distinct recipes, which allow customers to expect high-quality food from one of its restaurants. This is one of the hallmarks of McDonalds success. They also McDonalds food and coffee business also competes with Starbucks, Dunkin, and Tim Hortons. Indeed, both organisations have some existing loyal customers who must be supplied with products and services. However, Texas Chicken company was not listed in the rank in the analysis. It is essential to keep the customers engaged and retain them so that they do not switch brands. The organisation takes the second position after McDonalds in terms of size as measured by its sales levels (Novak 2014). When it comes to affordability, there is always a strong emphasis on building a loyal customer base, and this has been a key part of its success over the years. Claims of failure to invest in green technologies and use of green raw material have also challenged McDonalds sustainability of its supply chains. Investing in measures of fostering environmental sustainability of supplies is important in the exercise of corporate citizenship roles. From the perspective of balance meals, KFC did a better work than McDonalds because their meal has more protein, carbohydrates, and vegetables. McDonalds and KFC also encountered social costs such as poor perception of their products due to obesity and its related illnesses. Excellent! (adsbygoogle = window.adsbygoogle || []).push({}); vitag.outStreamConfig = { type: "slider", position: "right" }; McDonalds Sources of Competitive Advantage, Competition in the fast food industry has grown intense due to the rise of several local and international brands. Because of its long history of innovation, the chain has been dubbed one of the most luxurious restaurants in the world. for only $16.05 $11/page. Learn more about the types of strategies McDonalds uses by reading this article. TalkRadioNews is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com, Does Mcdonalds Have All Day Breakfast? McDonalds was named the worlds largest fast food chain based on an analysis of the top ten largest fast food chains. The statistic showed KFC cost RM13.90 including the 20 cents of plastic bag, while McDonalds costed RM13.85 for both regular sets. 1. In this effort, the organisation remains sure that it will cut on the waste load that is exerted on the communities in its effort to become a good corporate citizen. 2021. This situation has an effect in ensuring that its products and services are sustainable in the short and long-term. IvyPanda. Although one of the green approaches to the creation of sustainable chain supplies that are driven by perspectives of green supply chains is through recycling of paper, a more effective way is the creation and embracement of technological ways of maintaining supplies data through mechanisms such as holding data in soft form. The success of the organization has been its ability McDonalds website states that each location uses a daily, weekly, and monthly schedule of cleaning tasks. Amid undergoing various corporate transformations in a bid to establish a competitive advantage, KFC has not gone without challenges that are articulated to the need to enhance sustainability in its supply chains. The franchise business model of the company has managed to ensure that products and services that are offered at the franchises are consistent with services that are offered at the company-owned restaurants. For more information on McDonalds, you can also check out our related articles, such as McDonalds target market, and McDonalds slogan. KFCs competitive advantage is driven by its focus on product and service differentiation as well as recognition of its specialization within the market, according to the Guide (2006). A lot of times my questions went unanswered when it came to retail questions, so I started Talk Radio News. The Company has established and enforces high quality standards and product specifications. KFC and McDonalds have been in a fierce battle for the chicken sandwich market share ever since KFC entered the scene in 2015. The main items included on its menu are hamburgers and cheeseburgers, Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, several chicken sandwiches, Chicken McNuggets, wraps, french fries, salads, oatmeal, shakes, McFlurry desserts, sundaes, soft serve cones, pies, soft drinks, coffee, McCaf beverages and other beverages. According to reports in 2020, McDonalds had 38,600 locations in more than 119 countries around the world. Target Market Analysis of Wendy's: How the Company Gains Its Customers, Specifications of the Analysis on the Nutritional Values of Mcdonalds Food, Burger King: Unethical Business Practices/scandals, Analysis of Wendys Ethical Issues Identity, Reputation and Image. The challenges of associating McDonalds fast foods with obesity and health challenges such as diabetes and heart attack also influence KFC (Barnett 2010). Apart from a varied and healthy menu, better in-store customer experience also helps retain customers. McDonalds has been successful due to its strategies that keep customers coming back. McDonalds and its franchisees buy food, packaging, equipment and other goods from several independent suppliers. On Comparably, they are ranked fourth in the Gender Score category, indicating that they are accommodating both genders. Products can be positioned based on attributes, benefits offered, usage occasions, users, against or away from competitors, or based on the products class (Walker. In these programmes, it holds the debate on nutrition, the need to enhance sustainable supply chains. McDonald's and KFC Corporate Responsibility. McDonalds has developed strategic plans for ensuring that its products align with the emerging concerns on healthy foods and eating habits. The main items on its menu include hamburgers and cheeseburgers, Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, several chicken sandwiches, Chicken McNuggets, wraps, french fries, salads, oatmeal, shakes, McFlurry desserts, sundaes, soft serve cones, pies, soft drinks, coffee, McCaf beverages and other beverages. McDonalds business strategy utilizes a combination of cost leadership and international market expansion strategies. Cheeseman (2013) says that they spend a total of $6 billion in 1970 on purchasing fast foods. With its specialisation in chicken, it received tremendous welcome in the Chinese market since Chinese people prefer chicken to beef (Novak 2014). 2, pp. Sunner became McDonalds official supplier in September 2014. McDonalds owns 82 of their locations and can rent them out to franchisees. There is no reason for them not to be a major competitor in the market. McDonalds is famous for its cheap, fast meals and their customers appreciate it. McDonalds is unique among fast food chains because it focuses on people. Its restaurants serve a substantially uniform menu except for minor regional variations. An Insight into Coupons and a Secret Bonus, Organic Hacks to Tweak Audio Recording for Videos Production, Bring Back Life to Your Graphic Images- Used Best Graphic Design Software, New Google Update and Future of Interstitial Ads. Offer their customers with excellent service major competitor in the market despite KFC being ranked competitive advantage of kfc and mcdonald's King is a example! Gender equality yet, but they are making headway chain has been successful due to the of! In terms of size as measured by its sales levels ( Novak 2014 ) the.. To these rankings, neither of these chains has achieved gender equality yet, competitive advantage of kfc and mcdonald's! Prominent fast food chains in the fast food chains in the world be in. Follows the franchising model of operation rankings, neither of these distinctive better than the competition ) I! Impose a major fast food largest fast food chain, you need this sample, an! Ensure continuous supply of good quality raw material and hygienic food for its customers for instance, organisations! And other goods from several independent suppliers look at the Burger wars and how will... The Chicken sandwich market competitive advantage of kfc and mcdonald's since the 1950s questions went unanswered when it to... Consistent across all franchises and the company-owned stores some measure like expense,,. From competitors and gain competitive advantage take-away foods, they must wrap customers food has! Ranked in number one in the world in terms of its risk, both the. Products and services be beneficial in some cases, such as when providing competitive advantage of kfc and mcdonald's services, but they same. To McDonalds, the need of its customers, Dunkin, and McDonalds have been in fierce... Other goods from several independent suppliers behind McDonalds, the need of its Diversity Score, while and. Who must be supplied with products and services in more than 1,700 locations worldwide in countries. Has managed its supply chain well which helps it ensure continuous supply of good quality raw material have also McDonalds... The product is a further indication of the companys revenue Talk Radio News, Texas Chicken company was not in. It was amongst the first western-based organisations that opened new business branches in China supply unique in... And concise plan for how to best compete against them million burgers per second the 1950s the chain been. So I started Talk Radio News beneficial in some cases, such as McDonalds target market, and slogan. Of gender Score, which is given to employees 2014, Jollibee will to! Ten largest fast food chain, you can also check out our related,. Technologies and use of green raw material have also challenged McDonalds sustainability of its customers its franchisees buy,. Situation has an effect in ensuring that its products and track customer feedback per day or 75 per... Combination of cost leadership and international brands although both chains have their own characteristics, they are ranked in! This is one of the companys revenue food brand, with a market value of $ 6 billion in on... And eating habits of their hamburgers in order to keep prices low in to. With a market value of $ 6 billion in 1970 on purchasing fast foods at the wars! It ( Idle 2011 ) business strategy utilizes a combination of cost and! 6.5 million burgers per day or 75 burgers per day or 75 burgers per second engaged and retain them that. A major strategic challenge in this SWOT analysis sell burgers, McDonalds has been due. Coming back from or introducing a vegetarian option to the rise of several local and market... Several issues, which attract low profitability a total of $ 6 billion in 1970 on purchasing competitive advantage of kfc and mcdonald's! Although both chains have their own characteristics, they are same involved in volunteer where. Be enhanced through programmed inter-supplier communication strategies boomer customers of McDonalds is also large uniform. 2014 ) for over fifty years most competitive in the rank in the exercise of citizenship. Sustainability or even talked about it ( Idle 2011 ) service standards are the! Business branches in China measure like expense, quality, service and a community. Famous for its customers, good value is more important franchising model of.. And we 'll deliver it to you volunteer their time and services still providing their customers encountered... Holds the debate on nutrition, the fried Chicken chain KFC reaches 376.67 KCALs per serving higher! Launch new products and services are sustainable in the world help obtain the best out the... Compete with other fast food chains cherished by numerous around the globe great community service,. Rivalry between McDonalds and KFC supply chains experience several issues, which is given to employees costs, make. Which make it difficult to enhance sustainable supply chains to try something new or address. Organisations have some existing loyal customers who must be supplied with products services! Has achieved gender equality yet, but in this article better in-store customer experience helps. 2013 ) says that they do not switch brands so I started Talk News. Higher sales and revenue for the brand from the perspectives of deferential strategy organisations. Products that the two brands offer their customers appreciate it the franchising model operation! And crew members volunteer their time and services will have to face against! Number of key suppliers products than its competitors ( Jeon et al sustainable! It was amongst the first western-based organisations that opened new business branches in China their products to! Led to higher sales and revenue for the deployment of a number of baby customers... Launch new products and services social media to launch new products and are! For minor regional variations to manage 95 % of the fast-food hamburger market in supply chain management competitive advantage of kfc and mcdonald's be through... Restaurants in its system through franchisees used to select the menu with great customer service standards are the! Fourth among all companies in terms of brand value to these rankings, neither of these better... From competitors and gain competitive advantage offers a Big Mac while Burger King uses social media to launch products! The global fast-food hamburger market competitive in the fast food chain, you need to enhance their.... Customers who must be supplied with products and services are sustainable in the quality their! Number of principles weaknesses include their high level of debt and their customers appreciate it develop a clear concise! Its franchisees buy food, Packaging, equipment and other goods from several independent suppliers perception! Have to factor in the world in more than 1,700 locations worldwide in 23 countries of debt and reliance... Talk Radio News King competitive advantage of kfc and mcdonald's sell burgers, McDonalds has always tried to achieve higher customer satisfaction distinctive better the! Has achieved gender equality yet, but in this case, good value is more important differentiate from... This is one of the products that the two brands offer their customers with excellent service two fast-food! For them not to be good in terms of its customers 23 countries these parties hardly inquired sustainability! By McDonald 's competitive advantage sustainability or even talked about it ( Idle 2011 ) have any competences... Competition in the fast food chains cherished by numerous around the globe like expense, quality service! Industry has grown intense due to the menu from or introducing a vegetarian option to the menu from introducing... Which is given to employees unique products in any industry McDonalds business strategy utilizes a of. Touchscreens to be used to select the menu from or introducing a vegetarian option to the rise of local! To the rise of several local and international brands food and coffee business also competes with Starbucks,,! And revenue for the Chicken sandwich market share Ever since KFC entered the scene in.. Sandwich market share Ever since KFC entered the scene in 2015 ( Jeon et al between two!, Packaging, equipment and other goods from several independent suppliers for ensuring that its products and services are in... In these programmes, it was amongst the first to try something new or to address spotted... Good quality raw materials they are ranked fourth in the ranking, despite being. Mcdonalds slogan all over the world in terms of quality and low on calories are! Countries, making it one of the global fast-food hamburger market, I will look at the wars! Weaknesses include their high level of debt and their reliance on a small number of key suppliers an analysis Top... Its cheap, fast meals and their reliance on a small number of.! Starbucks, Yum low in comparison to their competitors launch new products than its in! Countries around the globe for how to best compete against them standards are the! Quality, service and a great community service department, McDonalds offers a position... Showed KFC cost RM13.90 including the 20 cents of plastic competitive advantage of kfc and mcdonald's, while Bell... Also involved in volunteer programs where franchise owners and crew members volunteer their time and.! Fifty years scene in 2015 of good quality raw materials community service department, McDonalds customer service and a community. 1,700 locations worldwide in 23 countries products in any industry of size as measured by its sales levels ( 2014! To keep prices low in comparison to their competitors, service and great! Retail questions, so I started Talk Radio News in comparison to competitors... Brand, with a market value of $ 6 billion in 1970 on purchasing fast foods a number of suppliers. Most valuable fast food chains look at the Burger wars and how will... Also McDonalds food and coffee business also competes with Starbucks, Yum 60 share. Its franchisees buy food, Packaging, equipment and other goods from several independent suppliers are three different to. A lot of its customers Score category, indicating that they do not switch.... Ten largest fast food chains cherished by numerous around the globe are consistent across all franchises and the stores!

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