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McDonald・s: Is China Lovin・ it?  
 
Product Ref: 08/409C Company: McDonald's

Product Type: Case Industry: Fast-Food Restaurant

Related Product(s): Teaching Note
McDonald・s, the world-famous American fast food franchisor, entered mainland China in 1990, when Chinese franchise law did not even exist. In this once-closed country whose market only opened up to foreign investors in 1978, McDonald・s had to adapt to an unfamiliar and rapidly changing environment. Not only was food culture in China vastly different from that in the West, but food culture, lifestyles and legal structure were altering as a result of surging economic growth and massive urbanisation.

Competition was also intensifying as local and foreign restaurants sought to capitalise on China・s increasing affluence. As the growing middle class demanded higher standards from these companies, McDonald・s local business practices in terms of food healthiness, employee welfare and other socio-environmental issues were put under close scrutiny in China. While the nation・s booming economy provided environmental conditions suitable for fast-food culture, the environment also posed challenges to the survival of fast-food operators in the country. Would McDonald・s be able to sustain its momentum as China transformed into a developed nation?
Functional Area : Marketing
Strategy & General Management

Issues: To identify opportunities and threats for companies in burgeoning economies through examining the external environmental forces, and to study the implications of competitive forces and strategic groups on the profit potential for an industry or a company.
Length: Text: 9 pages
Exhibits: 5 pages
Country: China (People's Rep. of)

Pub. Year: 2008 Level of Difficulty: 2
         
This product type is available in the following language(s):      English
         
Related Information: N/A
 
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