Addressed To: Mrs C Waller
Date: 28th February 2017
Topic: The Challenge of Competitors for McDonalds
South Africa, being a developing country is seen as a land full of opportunities for international franchises (especially those within the QSR industry) to enter the South African Market. This will obviously pose a huge challenge for fast food outlets that are already and have been existing in South Africa for a very long time, such as McDonalds, because they will have to keep up with the international franchises entering the South African market and implement strategies that will assist them in preventing these franchises from entering the South African Market successfully.
Comprehensive Summary of Article
• This particular discusses …show more content…
• This article is relevant because it really outlines how a business, especially businesses like fast food outlets always have to be quick on their feet and always be aware of who their competitors are and what they are doing and they need to do a lot of market research in order to keep their brand fresh, relevant and customer satisfactory. I chose this article because I really thought that McDonalds was really doing well then when I read this article I saw that it’s suffering a bit at the hands of its competitors, and I wanted to look into it more and I thought it would be perfect for me to analyse it.
Porter’s Five Forces Analysis – McDonalds South Africa:
Because the challenge that McDonalds South Africa is facing lies is competitors, which lie in the Market Environment it is fitting that I analyse their challenges using Porters Fives Forces model.
1. Level of rivalry:
The level of rivalry is very high for McDonalds South Africa as there already established fast food outlets in South Africa that they compete with such as Steers, Nando’s, KFC and Wimpy.
2. Availability of substitute …show more content…
Availability of substitute products:
McDonalds SA should improve the quality of their burger patties and their fries without increasing the price so that the customer can be satisfied with what they are consuming and that the customer will not turn to substitute products.
3. Threat of new entrants:
McDonalds SA should start differentiating themselves by having new additions to the menu, revamping their brand (this could help with making the customers loyal to McDonalds and not want to buy from other outlets), introducing a South African Brand ambassador or negotiating with Mall/Shopping Centre landlords to not let new competing international fast food franchises into the centre.
4. Power of suppliers:
McDonalds SA should ensure that they are receiving good quality products at a reasonable price from suppliers so that they can ensure a good relationship with their suppliers (and the franchisees need to ensure that they maintain good relationships with their franchisors) and make sure that they pay their suppliers on time so that they won’t be any problems or bad blood between the franchisee and the franchisor and the corporate owned store and its supplier.
5. Power of
Date: 28th February 2017
Topic: The Challenge of Competitors for McDonalds
South Africa, being a developing country is seen as a land full of opportunities for international franchises (especially those within the QSR industry) to enter the South African Market. This will obviously pose a huge challenge for fast food outlets that are already and have been existing in South Africa for a very long time, such as McDonalds, because they will have to keep up with the international franchises entering the South African market and implement strategies that will assist them in preventing these franchises from entering the South African Market successfully.
Comprehensive Summary of Article
• This particular discusses …show more content…
• This article is relevant because it really outlines how a business, especially businesses like fast food outlets always have to be quick on their feet and always be aware of who their competitors are and what they are doing and they need to do a lot of market research in order to keep their brand fresh, relevant and customer satisfactory. I chose this article because I really thought that McDonalds was really doing well then when I read this article I saw that it’s suffering a bit at the hands of its competitors, and I wanted to look into it more and I thought it would be perfect for me to analyse it.
Porter’s Five Forces Analysis – McDonalds South Africa:
Because the challenge that McDonalds South Africa is facing lies is competitors, which lie in the Market Environment it is fitting that I analyse their challenges using Porters Fives Forces model.
1. Level of rivalry:
The level of rivalry is very high for McDonalds South Africa as there already established fast food outlets in South Africa that they compete with such as Steers, Nando’s, KFC and Wimpy.
2. Availability of substitute …show more content…
Availability of substitute products:
McDonalds SA should improve the quality of their burger patties and their fries without increasing the price so that the customer can be satisfied with what they are consuming and that the customer will not turn to substitute products.
3. Threat of new entrants:
McDonalds SA should start differentiating themselves by having new additions to the menu, revamping their brand (this could help with making the customers loyal to McDonalds and not want to buy from other outlets), introducing a South African Brand ambassador or negotiating with Mall/Shopping Centre landlords to not let new competing international fast food franchises into the centre.
4. Power of suppliers:
McDonalds SA should ensure that they are receiving good quality products at a reasonable price from suppliers so that they can ensure a good relationship with their suppliers (and the franchisees need to ensure that they maintain good relationships with their franchisors) and make sure that they pay their suppliers on time so that they won’t be any problems or bad blood between the franchisee and the franchisor and the corporate owned store and its supplier.
5. Power of