STUDY OF CONSUMER SATISFACTION

TOWARDS MC DONALD’S

A report submitted to JaganNath Institute of Management Sciences, Rohini

as a part fulfilment of

GDIB program in Consumer behavior

Submitted to: Submitted by:

Anshul Garg Shankar Sharma

Faculty: Roll No: 280

JIMS Batch: (2009 -2011)

Semester: 4th

JIMS JaganNath Institute of Management Sciences Community Centre sector, Sector- 3, Rohini, Delhi

[1]

DECLARETION

I hereby certify that the work which is being presented in the project

entitled, “STUDY OF CONSUMER SATISFACTION TOWARDS MC

DONALD’S. ” in partial Fulfilment of the requirements for the award degree

of G.D.I.B, is an authentic record of my own work .The matter presented in

this Project Report has not been submitted by me for the award of any other

degree of this or any other University.

DATE:

Shankar Sharma

[2]

ACKNOWLEDGEMENT

Concentration, dedication and application are necessary but not sufficient to achieve any

goal. Therefore, it is our pleasant duty to offer our service of acknowledgement to those

honourable personalities of the department who helped me to follow the path to success

for the completion of this project.

Survey is an excellent tool for learning and exploration. No classroom routine can

substitute which is possible while working in real situations. Application of theoretical

knowledge to practical situations is the bonanzas of this survey. Without a proper

combination of inspection and perspiration, it’s not easy to achieve anything. There is

always a sense of gratitude, which we express to others for the help and the needy

services they render during the different phases of our lives. I too would like to do it as I

really wish to express my gratitude toward all those who have been helpful to me directly

or indirectly during the development of this project.

I would like to thank my faculty who was always there to help and guide me when I

needed help. Her perceptive criticism kept me working to make this project more full

proof. I am thankful to her for his encouraging and valuable support. Working under her

was an extremely knowledgeable and enriching experience for me. I am very thankful to

her for all the value addition and enhancement done to me. No words can adequately

express my overriding debt of gratitude to my parents whose support helps me in all the

way. Above all I shall thank my friends who constantly encouraged and blessed me so as

to enable me to do this work successfully.

Shankar Sharma

[3]

CERTIFICATE

This is to certify that the project was done on “STUDY OF

CONSUMER SATISFACTION TOWARDS MC DONALD’S. ”

Submitted to JIMS, Shankar Sharma in partial fulfilment of

the award of degree of BBA& GDIB in Consumer Behaviour,

is a bonafide work is carried out by him under my supervision

and guidance . This work has been submitted for

degree/diploma. The original work was carried during 15th

January to 15th February.

Date: Name of the guide:

Anshul Garg

[4]

TABLE OF CONTENTS

Sr. no Contents Page.no.

1 Industry profile 7

2 Company profile

●About company

●Poblems of organization

●Compititor information

●SWOT analysis

11

12

25

29

31

3 Conceptual Discussion

●Concept of topic

35

36

4 Research Methedology

●Objective

●Research design

●Data collection

●Questionnaire design

●Sample design

●Sample unit

●Sampling technique

●Time frame

●Sample Size

●Limitation of research

40

41

41

41

42

42

42

42

42

42

43

5 Data analysis 44

6 Finding & Recomendation 58-60

7 Bibliography 62

8 Annexure 64

[5]

CHAPTER - 1

INTRODUCTION

[6]

INDUSTRY OVERVIEW

Fast food (also known as Quick Service Restaurant or QSR within the industry itself) is

the term given to food that can be prepared and served very quickly. While any meal with

low preparation time can be considered to be fast food, typically the term refers to food

sold in a restaurant or store with preheated or precooked ingredients, and served to the

customer in a packaged form for take-out/take-away. The term "fast food" was

recognized in a dictionary by Merriam–Webster in 1951.

Outlets may be stands or kiosks, which may provide no shelter or seating, or fast food

restaurants (also known as quick service restaurants). Franchise operations which are part

of restaurant chains have standardized foodstuffs shipped to each restaurant from central

locations.

The capital requirements involved in opening up a non-franchised fast food restaurant are

relatively low. Restaurants with much higher sit-in ratios, where customers tend to sit and

have their orders brought to them in a seemingly more upscale atmosphere, may be

known in some areas as fast casual restaurants.

The concept of ready-cooked food for sale is closely connected with urban development.

In Ancient Rome cities had street stands that sold bread and wine. A fixture of East Asian

cities is the noodle shop. Flatbread and falafel are today ubiquitous in the Middle East.

Popular Indian fast food dishes include vada pav, panipuri and dahi vada. In the French-

speaking nations of West Africa, roadside stands in and around the larger cities continue

to sell—as they have done for generations—a range of ready-to-eat, char-grilled meat

sticks known locally as brochettes (not to be confused with the bread snack of the same

name found in Europe).

Quick food outside the home or workplace has become an essential part of lifestyle in

India over the past decade. McDonald’s, Pizza Hut, Domino’s Pizza, and Nirula’s fast

food chains have outlets in every nook and cranny of large cities. They efficiently serve

[7]

burgers, fries, chicken nuggets, hot dogs, sandwiches and drinks to the busy person who

doesn’t have more than five minutes to spare for his meal. Fast food has also rapidly

gained popularity among the youth ever since its emergence. It is the youth’s idea of a

quick and tasty lunch on-the-go.

Why fast food? It’s tasty, economical and only a drive-through or phone call away.

Emergence

The fast food culture emerged as early as the 19th century. During the Industrial

Revolution, a large workforce was required to work for 10 to 12 hours a day. With so

much work to be done, fast food was the idea of a quick and easy lunch.

In India, fast food culture emerged in the decades after independence, starting from the

1950’s. Eating at home used to be a significant aspect of Indian culture, so the change

was gradual. Over a period of time, with a growth in the number of nuclear families,

economic growth and increasing per capita income as well as globalization, fast food

culture gained prominence. Women were shifting from their conventional roles of

managing the household and taking care of the children. With growth in literacy, they

started joining the workforce in large numbers. Fast food became a time-saving

alternative to cooking for them.

Similarly, children resorted to fast food to fill their stomachs in school and college. Their

exposure to global urban culture and Western cuisine accelerated their want for cheap

and delicious fast food.

Moreover, fast food costs less than traditional long meals commencing with appetizer and

concluding with dessert.

Nirula’s and Pizza Corner – India’s most popular domestic fast food chains – gained

rapid popularity during this period. Though the fast food culture originated abroad, these

domestic food chains could create a perfect blend of international food with Indian

[8]

ingredients. Paneer pizzas and aloo tikki burgers were indeed able to satisfy Indian taste

buds.

With the liberalization of the economy in 1992, new multinational fast food giants started

dotting India with their outlets. Burger King, Wimpy’s, Pizza Hut, Domino’s Pizza,

McDonald’s, and KFC outlets can be seen today in nearly every shopping mall and other

public areas. In fact, these multinationals have given their domestic counterparts a run for

their money. They are growing at a much faster pace than the Indian chains.

Impact

The emergence of the fast food industry has, to an extent, transformed urban food culture

in India.

It is common knowledge that too much fast food is bad for health and may lead to

obesity. An essential component of most fast food is fat – the kind of fat that in excess

can lead to artery clogging. In large quantities, fast food may lead to obesity as well as

hypertension, diabetes, high cholesterol and heart diseases. Even certain types of cancers

have been observed to spread due to lack of safety standards in some sectors of the fast

food industry.

There are also several environmental problems associated with how fast food outlets

process and package their products. Food packaging is done using plastic, Styrofoam and

other synthetic products which are not biodegradable. In recent times, many fast food

outlets have switched to paper bags. Though paper is biodegradable, at the large

quantities in which paper waste is generated in India, currently paper is seen more as a

pollutant. Metal and glassware would be more favorable to serve food, but they destroy

the whole purpose of consuming food on-the-go. The need of the hour is a law or

regulation that forces these outlets to recycle the paper, plastic and foam they use

everyday.

India’s fast food industry is growing at 40% per annum and generates over Rs. 4800

crores in sales. The multinational segment of the industry generates over Rs. 7000 crores.

[9]

Fast food has, in a way, impacted the Indian economy by creating jobs. Outlets require a

large number of unskilled workers who are willing to work for low wages. On the one

hand, this generates widespread employment. On the other hand, some analysts feel that

it weakens the economy by forcing people to take up jobs in which there is little room for

advancement.

Fast food industry has been very successful in India, both in financial terms as well as in

popularizing its quick service culture among the population.

[10]

Chapter 2

Company profile

[11]

About Company

McDonald's Corporation (NYSE:MCD) is the world's largest chain of hamburger fast

food restaurants, serving more than 58 million customers daily. In addition to its

signature restaurant chain, McDonald’s Corporation held a minority interest in Pret A

Manger until 2008, was a major investor in the Chipotle Mexican Grill until 2006 and

owned the restaurant chain Boston Market until 2007.

A McDonald's restaurant is operated by either a franchisee, 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% over the three years ending in 2007 to $22.8 billion, and 9% growth in operating

income to $3.9 billion.

McDonald's primarily sells hamburgers, cheeseburgers, chicken products, french fries,

breakfast items, soft drinks, shakes, and desserts. In response to obesity trends in Western

nations and in the face of criticism over the healthiness of its products, the company has

modified its menu to include alternatives considered healthier such as salads, wraps and

fruit.

History

McDonald's Logo used from 1968 to 2003. It still exists at some restaurants.

[12]

"Speedee", the former mascot of McDonald's before his replacement by Ronald

McDonald.

Concept version of Ronald McDonald.

Main article: History of McDonald's

The business began in 1940, with a restaurant opened by brothers Richard and Maurice

McDonald in San Bernardino, California. Their introduction of the "Speedee Service

System" in 1948 established the principles of the modern fast-food restaurant. The

original mascot of McDonald's was a man with a chef's hat on top of a hamburger shaped

head whose name was "Speedee." Speedee was eventually replaced with Ronald

McDonald by 1967 when the company first filed a U.S. trademark on a clown shaped

man having puffed out costume legs.

McDonald's first filed for a U.S. trademark on the name McDonald's on May 4, 1961,

with the description "Drive-In Restaurant Services," which continues to be renewed

through the end of December 2009. In the same year, on September 13, 1961, the

company filed a logo trademark on an overlapping, double arched "M" symbol. The

overlapping double arched "M" symbol logo was temporarily disfavored by September 6,

1962, when a trademark was filed for a single arch, shaped over many of the early

[13]

McDonald's restaurants in the early years. The famous double arched "M" symbol in use

today did not appear until November 18, 1968, when the company filed a U.S. trademark.

The first McDonald's restaurants opened in the United States, Canada, Costa Rica,

Panama, Japan, the Netherlands, Germany, Australia, France, El Salvador and Sweden, in

order of openings.

The present corporation dates its founding to the opening of a franchised restaurant by

Ray Kroc, in Des Plaines, Illinois, on April 15, 1955, the ninth McDonald's restaurant

overall. Kroc later purchased the McDonald brothers' equity in the company and led its

worldwide expansion, and the company became listed on the public stock markets in

1965. Kroc was also noted for aggressive business practices, compelling the McDonald

brothers to leave the fast food industry. The McDonald brothers and Kroc feuded over

control of the business, as documented in both Kroc's autobiography and in the

McDonald brothers' autobiography. The site of the McDonald brothers' original

restaurant is now a monument.

With the expansion of McDonald's into many international markets, the company has

become a symbol of globalization and the spread of the American way of life. Its

prominence has also made it a frequent topic of public debates about obesity, corporate

ethics and consumer responsibility.

Mission

We have provided below details of the content of the McDonald Vision Statement, one of

the most successful companies in the World.

We hope that the McDonald Vision Statement together with our definitions, hints and tips

will provide you with inspiration to develop your own successful explanatory paragraph

which will prove to be suitable for both your associates, customers and employees.

[14]

Vision

"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."

Headquarters

McDonald's Plaza, the headquarters of McDonald's

The McDonald's headquarters complex, McDonald's Plaza, is located in Oak Brook,

Illinois. It sits on the site of the former headquarters and stabling area of Paul Butler, the

founder of Oak Brook. McDonald's moved into the Oak Brook facility from an office

within the Chicago Loop in 1971.

Products

1.

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McDonald's India ( Culturally Sensitive)

McDonald's worldwide is well known for the high degree of respect for the local customs

and culture. McDonald’s has developed a menu especially for India with vegetarian

selections to suit Indian tastes and preferences. Keeping in line with this, McDonald's

does not offer any beef or pork items in India. In the last decade it has introduced some

vegetarian and non-vegetarian products with local flavors that have appealed to the

Indian palate. There have been continuous efforts to enhance variety in the menu by

developing more such products.

McDonald's has also re-engineered its operations repeatedly in its 11 years in India to

address the special requirements of a vegetarian menu. Vegetable products are 100%

vegetarian, i.e,

They are prepared separately, using dedicated equipment and utensils.

Only pure vegetarian oil is used as a cooking medium.

Cheese and sauces are completely vegetarian and egg less.

Separation of vegetarian and non-vegetarian food products is maintained throughout the

various stages of procurement, cooking and serving.

Restaurant Count

McDonald’s has 132 restaurants in India of which 79 are in North & East India and 53 in

West & South India.

[18]

79 restaurants in North & East India: with

33 in Delhi

22 in Uttar Pradesh – Noida (5), Ghaziabad (4), Mathura (1) (Highway and Drive Thru),

Kanpur (2), Meerut (2), Lucknow (4), Agra (1), Allahabad (1), Varanasi (2)

11 in Haryana - Faridabad (3), Manesar (1) (Highway and Drive - Thru), Gurgaon (5),

Karnal (1) (Highway and Drive - Thru), Panipat (1)

7 in Punjab - Chandigarh (2), Ludhiana (2), Doraha (1) (Highway and Drive - Thru),

Jalandhar (1), Patarsi (1) (Highway and Drive - Thru)

3 in Rajasthan - Jaipur (3)

1 in Uttaranchal - Dehradun (1)

1 in West Bengal – Kolkata (1)

1 in Himachal Pradesh- Jabli (1).

53 restaurants in West & South India:

32 in Maharashtra – Mumbai (23), Pune (8), Nasik (1)

7 in Gujarat – Ahmedabad (4), Vadodara (2), Surat (1)

7 in Karnataka – Bangalore(7)

4 in Andhra Pradesh – Hyderabad (4)

3 in Madhya Pradesh – Indore (3)

[19]

Corporate overview

Facts and figures

McDonald's boasts its service to "99 billion customers".

McDonald's restaurants are found in 119 countries and territories around the world and

serve 58 million customers each day. McDonald's operates over 31,000 restaurants

worldwide, employing more than 1.5 million people. The company also operates other

restaurant brands, such as Piles Café.

Focusing on its core brand, McDonald's began divesting itself of other chains it had

acquired during the 1990s. The company owned a majority stake in Chipotle Mexican

Grill until October 2006, when McDonald's fully divested from Chipotle through a stock

exchange. Until December 2003, it also owned Donatos Pizza. On August 27, 2007,

McDonald's sold Boston Market to Sun Capital Partners.

[20]

Types of restaurants

Most standalone McDonald's restaurants offer both counter service and drive-through

service, with indoor and sometimes outdoor seating. Drive-Thru, Auto-Mac, Pay and

Drive, or "McDrive" as it is known in many countries, often has separate stations for

placing, paying for, and picking up orders, though the latter two steps are frequently

combined; it was first introduced in Arizona in 1975, following the lead of other fast-

food chains. The first such restaurant in Britain opened at the Merry Hill Shopping

Centre in the West Midlands in November 1986.

In some countries, "McDrive" locations near highways offer no counter service or

seating. In contrast, locations in high-density city neighborhoods often omit drive-

through service. There are also a few locations, located mostly in downtown districts, that

offer Walk-Thru service in place of Drive-Thru.

Specially themed restaurants also exist, such as the "Solid Gold McDonald's," a 1950s

rock-and-roll–themed restaurant. In Victoria, British Columbia, there is also a

McDonald's with a 24-carat (100%) gold chandelier and similar light fixtures.

To accommodate the current trend for high quality coffee and the popularity of coffee

shops in general, McDonald's introduced McCafé, a café-style accompaniment to

McDonald's restaurants in the style of Starbucks. McCafé is a concept created by

McDonald's Australia, starting with Melbourne in 1993. Today, most McDonald's in

Australia have McCafés located within the existing McDonald's restaurant. In Tasmania,

there are McCafés in every store, with the rest of the states quickly following suit. After

upgrading to the new McCafé look and feel, some Australian stores have noticed up to a

60% increase in sales. As of the end of 2003 there were over 600 McCafés worldwide.

Some locations are connected to gas stations/convenience stores, while others called

McExpress have limited seating and/or menu or may be located in a shopping mall.

Other McDonald's are located in Wal-Mart stores. McStop is a location targeted at

truckers and travelers which may have services found at truck stops.

[21]

Playgrounds

McDonald's in Panorama City, California designed for family-friendly image

Some McDonald's in suburban areas and certain cities feature large indoor or outdoor

playgrounds. The first Play Place with the familiar crawl-tube design with ball pits and

slides was introduced in 1987 in the USA, with many more being constructed soon after.

Some Play Place playgrounds have been renovated into "R Gym" areas.

Redesign

The Mc Donnald's restaurant in Dudley Town,near Birmingham, during 2002. It is

in the old red, gold and grey livery.

[22]

McDonald's in Darlington, UK. This is an example of the new look of McDonald's in

Europe.

In 2006, McDonald's introduced its "Forever Young" brand by redesigning all of their

restaurants, the first major redesign since the 1970s.

The Mc Donald's restraunt in Banbury's Bridge Street in 2010. It is still in white

paint outside and blue/grey/brown inside as it was since 2002.

The design includes the traditional McDonald's yellow and red colors, but the red is

muted to terra cotta, the yellow was turned golden for a more "sunny" look, and olive and

sage green were also added. To warm up their look, the restaurants have less plastic and

more brick and wood, with modern hanging lights to produce a softer glow.

Contemporary art or framed photographs hang on the walls.

Business model

McDonald'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's business model is slightly different from that of most other

fast-food chains. In addition to ordinary franchise fees and marketing fees, which are

calculated as a percentage of sales, McDonald's may also collect rent, which may also be

[23]

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 UK business model is different, 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 at Hamburger University in Oak 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 to Fast Food Nation by Eric Schlosser (2001), nearly one in eight workers in

the U.S. have at some time been employed by McDonald's. (According to a news piece

on Fox News this figure is one in ten.) The book also states that McDonald's is the largest

private operator of playgrounds in the U.S., as well as the single largest purchaser of

beef, pork, potatoes, and apples. The selection of meats McDonald's uses varies with the

culture of the host country.

Shareholder dividends

McDonald's has increased shareholder dividends for 25 consecutive years, making it one

of the S&P 500 Dividend Aristocrats.

Advertising

McDonald's has for decades maintained an extensive advertising campaign. In addition to

the usual media (television, radio, and newspaper), the company makes significant use of

[24]

billboards and signage, sponsors sporting events ranging from Little League to the

Olympic Games, and makes coolers of orange drink with their logo available for local

events of all kinds. Nonetheless, television has always played a central role in the

company's advertising strategy.

To date, McDonald's has used 23 different slogans in United States advertising, as well as

a few other slogans for select countries and regions. At times, it has run into trouble with

its campaigns.

Problems of organization

Controversies

As a prominent example of the rapid globalization of the American fast food industry,

McDonald's is often the target of criticism for its menu, its expansion, and its business

practices.

The McLibel Trial, also known as McDonald's Restaurants v Morris & Steel, is an

example of this criticism. In 1990, activists from a small group known as London

Greenpeace (no connection to the international group Greenpeace) distributed leaflets

entitled What's wrong with McDonald's?, criticizing its environmental, health, and labor

record. The corporation wrote to the group demanding they desist and apologize, and,

when two of the activists refused to back down, sued them for libel in one of the longest

cases in British civil law. A documentary film of the McLibel Trial has been shown in

several countries.

Despite the objections of McDonald's the term "McJob" was added to Merriam-Webster's

Collegiate Dictionary in 2003. Defined as "a low-paying job that requires little skill and

provides little opportunity for advancement". In an open letter to Merriam-Webster, Jim

Cantalupo, former CEO of McDonald's, denounced the definition as a "slap in the face"

to all restaurant employees, and stated that "a more appropriate definition of a 'McJob'

[25]

might be 'teaches responsibility.'" Merriam-Webster responded that "we stand by the

accuracy and appropriateness of our definition."

In 1999, French anti-globalisation activist José Bové vandalized a half-built McDonald's

to protest against the introduction of fast food in the region.

In 2001, Eric Schlosser's book Fast Food Nation included criticism of the business

practices of McDonald's. Among the critiques were allegations that McDonald's (along

with other companies within the fast food industry) uses its political influence to increase

its profits at the expense of people's health and the social conditions of its workers. The

book also brought into question McDonald's advertisement techniques in which it targets

children. While the book did mention other fast-food chains, it focused primarily on

McDonald's.

McDonald's is the world's largest distributor of toys, which it includes with kids meals. It

has been alleged that the use of popular toys encourages children to eat more McDonald's

food, thereby contributing to many children's health problems, including a rise in obesity.

In 2002, vegetarian groups, largely Hindu and Buddhist, successfully sued McDonald's

for misrepresenting their French fries as vegetarian, when they contained beef broth.

A midget PETA activist dressed as a chicken argues with a manager of the Times

Square McDonald's over the company's animal welfare standards.

People for the Ethical Treatment of Animals (PETA), meantime, continues to pressure

McDonald’s to change its animal welfare standards, in particular the method their

suppliers use of slaughtering chickens. Most processors in the United States shackle fully

conscious birds upside down and run them through an electrically charged water tub

before slitting their throats. PETA argues that using gas to kill the birds (a method called

“controlled atmosphere killing” or CAK) is less cruel. Both CAK and “controlled

atmosphere stunning”(CAS) are commonly used in Europe.

[26]

Morgan Spurlock's 2004 documentary film Super Size Me said that McDonald's food was

contributing to the epidemic of obesity in society, and that the company was failing to

provide nutritional information about its food for its customers. Six weeks after the film

premiered, McDonald's announced that it was eliminating the super size option, and was

creating the adult happy meal.

The soya that is fed to McDonald’s chickens is supplied by agricultural giant Cargill and

comes directly from Brazil. Greenpeace alleges that not only is soya destroying the

Amazon rain forest in Brazil, but soya farmers are guilty of further crimes including

slavery and the invasion of indigenous peoples’ lands. The allegation is that McDonald's,

as a client of Cargill's, is complicit in these activities.

Arguments in defense

In response to public pressure, McDonald's has sought to include more healthy choices in

its menu and has introduced a new slogan to its recruitment posters: "Not bad for a

McJob". (The word McJob, first attested in the mid-1980s and later popularized by

Canadian novelist Douglas Coupland in his book Generation X, has become a buzz word

for low-paid, unskilled work with few prospects or benefits and little security.)

McDonald's disputes the idea. In 2007, the company launched an advertising campaign

with the slogan "Would you like a career with that?" on Irish television, outlining that

their jobs have many prospects.

In a bid to tap into growing consumer interest in the provenance of food, the fast-food

chain recently switched its supplier of both coffee beans and milk. UK chief executive

Steve Easterbrook said: "British consumers are increasingly interested in the quality,

sourcing and ethics of the food and drink they buy". McDonald's coffee is now brewed

from beans taken from stocks that have been certified by the Rainforest Alliance, a

conservation group. Similarly, milk supplies used for its hot drinks and milkshakes have

been switched to organic sources which could account for 5% of the UK's organic milk

output.

[27]

McDonald's announced on May 22, 2008 that, in the U.S. and Canada, it would switch to

using cooking oil for its french fries that contains no trans fats, and canola-based oil with

corn and soy oils by year's end for its baked items, pies and cookies.

With regard to acquiring chickens from suppliers who use CAK or CAS methods of

slaughter, McDonald's says they need to see more research "to help determine whether

any CAS system in current use is optimal from an animal welfare perspective."

Legal cases

McDonald's has been involved in a number of lawsuits and other legal cases, most of

which involved trademark disputes. The company has threatened many food businesses

with legal action unless they drop the Mc or Mac from their trading name. In one

noteworthy case, McDonald's sued a Scottish café owner called McDonald, even though

the business in question dated back over a century (Sheriff Court Glasgow and

Strathkelvin, November 21, 1952). On September 8, 2009, McDonald's Malaysian

operations lost a lawsuit to prevent another restaurant calling itself McCurry. McDonald's

lost in an appeal to Malaysia's highest court, the Federal Court.

It has also filed numerous defamation suits. For example, in the McLibel case,

McDonald's sued two activists for distributing pamphlets attacking its environmental,

labor and health records. After the longest trial in UK legal history, McDonald's won a

technical victory for showing that some allegations were untrue. The McLibel Case was

also a massive public relations disaster for McDonald's, as the judge also found that while

more than half of what was on the pamphlet was truthful, much of the information simply

the opinions of the activists and therefore non-prosecutable.

McDonald's has defended itself in several cases involving workers' rights. In 2001 the

company was fined £12,400 by British magistrates for illegally employing and over-

working child labor in one of its London restaurants. This is thought to be one of the

largest fines imposed on a company for breaking laws relating to child working

conditions (R v 2002 EWCA Crim 1094). In April 2007 in Perth, Western Australia,

[28]

McDonald's pleaded guilty to five charges relating to the employment of children under

15 in one of its outlets and was fined AU$8,000.

Possibly the most infamous legal case involving McDonald's was the 1994 decision in

The McDonald's Coffee Case.

In a McDonald's American Idol figurine promotion, the figurine that represents "New

Wave Nigel" wears something that closely resembles Devo’s Energy Dome, which was

featured on the band's album cover, Freedom of Choice. In addition to the figurine's

image, it also plays a tune that appears to be an altered version of Devo's song "Doctor

Detroit." Devo copyrighted and trademarked the Energy Dome and is taking legal action

against McDonald's.

Compititor

1.

Domino's Pizza, Inc. (NYSE: DPZ) is an international pizza delivery corporation

headquartered in Ann Arbor, Michigan, United States. Founded in 1960, Domino's is the

second-largest pizza chain in the United States[1] and has nearly 9,000 corporate

and franchisedstores in 60 international markets[3] and all 50 U.S. states. Domino's Pizza

was sold to Bain Capital in 1998 and went public in 2004. The menu features pizza,

pasta, oven-baked sandwiches, wings, boneless chicken, salads, breadsticks, cheesesticks,

and a variety of dessert items.

[29]

2.

KFC Corporation (KFC), founded and also known as Kentucky Fried Chicken, is a

chain offast food restaurants based in Louisville, Kentucky, in the United States. KFC has

been a brand and operating segment, termed a concep of Yum! Brands since 1997 when

that company was spun off from PepsiCo as Tricon Global Restaurants Inc.

KFC primarily sells chicken pieces, wraps, salads and sandwiches. While its primary

focus isfried chicken, KFC also offers a line of grilled and roasted chicken products, side

dishes anddesserts. Outside North America, KFC offers beef based products such

as hamburgers or kebabs, pork based products such as ribs and other regional far

The company was founded as Kentucky Fried Chicken by Colonel Harland Sanders in

1952, though the idea of KFC's fried chicken actually goes back to 1930. Although

Sanders died in 1980, he remains an important part of the company's branding and

advertisements, and "Colonel Sanders" or "The Colonel" is a metonym for the company

itself. The company adopted KFC, an abbreviated form of its name, in 1991. Starting in

April 2007, the company began using its original name, Kentucky Fried Chicken, for its

signage, packaging and advertisements in the U.S. as part of a new corporate re-branding

program; newer and remodeled restaurants will have the new logo and name while older

stores will continue to use the 1980s signage. Additionally, Yum! continues to use the

abbreviated name freely in its advertising.

3.

[30]

Subway is an American restaurant franchise that primarily sells submarine

sandwiches (subs),salads, and personal pizzas. It is owned and operated by Doctor's

Associates, Inc. (DAI). Subway is one of the fastest growing franchises in the world with

approximately 34,003 restaurants in 95 countries/territories as of February, 2011. It is the

largest single-brand restaurant chain globally and is the second largest restaurant operator

globally after Yum! Brands (35,000 locations).

Subway's main operations office is in Milford, Connecticut, and five regional centers

support Subway's growing international operations. The regional offices for European

franchises are located in Amsterdam, Netherlands; The Australia and New

Zealand locations are supported from Brisbane, Australia; the Middle Eastern locations

are supported from offices located inBeirut, Lebanon; the Asian locations

from Singapore and India, Korean Peninsula operations from Pyongyang and the Latin

America support center is in Miami, Florida. In the UK andIreland the company hopes to

expand to 2,010 restaurants by some time in 2010.

4.

Wimpy is the brand name of a chain of fast-food hamburger restaurants based in the UK.

It is well known for its burger known as the Bender, which is actually

a frankfurter sausage and not a hamburger patty. The restaurants were originally called

Wimpy Bars, but the name was shortened to “Wimpy” many years ago. The current

owners of the Wimpy brand operate in several countries under the name of Wimpy

International.

S.W.O.T Analysis of Mc donald’s

[31]

Strengths

• It has a strong global presence and is considered as a market leader in both the domestic

as well as the international markets.

• It is a global brand that owns 31,000 restaurants serving in 120 countries. Of these

31,000 restaurants at least14,000 restaurants are situated in the US.

• It uses economies of scale for reducing the cost, as its huge expansion diversifies the

overall risk involved with the economic performance.

• They own an active children’s charity by the name‘The Ronald McDonald House’.

• It takes steps in adjusting the Ingredients and product offerings in order to comply with

the upgraded health standards deemed necessary by the USDA.

• It earns revenue by fast food sales as well as a property investor and a franchiser of

restaurants.

•  It has a firm real estate portfolio.

• It has branded menu items i-e Big Mac, Chicken McNuggets, which further promote

McDonalds.

• It is recognized as one of the world’s most recognized logos.

• It is recognized as a socially responsible and community oriented firm.

• It adapts to the cultural differences regarding the region where the restaurant is set up.

• It has located itself in major airports, cities, highways, tourist locations, theme parks.

• It has an efficient food preparation style that follows the process in a systematic way.

• It takes food safety extremely cautiously.

[32]

• It was the first to provide the customers about nutrition facts.

Weaknesses

• It uses advertising that mostly targets children.

• High employee turn-over.

• It has yet to accomplish going on the trend of organic food.

• Price competition with the competitors resulting in low revenue.

• Lack of innovative products.

Opportunities

• It can adapt to the needs of the societies and undergo an innovative product line.

• It can research ways to use ‘green’ energy and packaging which will work as a part of

their promotional effort as well as fulfill their social responsibility.

• It can create new product offerings, use mobile text messaging to offer services that

appeal to consumers.

• It can upscale some of its restaurant settings at luxurious locations to attract more

customers.

• It can provide optional items that are regarded to be the basis of allergy for some.

• It can slow down the level of expansion in order to increase the profitability of the

organization.

[33]

Threats

• The recession negatively impacts the holding position of the firm regarding its revenue

streams, even though they are quite diversified.

• Foreign currency fluctuations are regarded to be a major problem as it uses standard

pricing for its food items.

• More restaurants that are increasing their food offering and declining the price.

•  Health issues regarding the fast food chain.

•  Heavy investments on promotional campaigns which decrease the gaining of market

share.

• Some parents criticize the firm’s ‘cradle to grave’ marketing strategy that focuses on

kids, who later on take it as a trend to their adulthood.

•  Sued various times for unhealthy food, usually with addictive additives.

• Emergence of major fast food competitors: Burger King, Starbucks, Wendy’s, Taco

Bell, KFC.

• The expansion has made the firm vulnerable to the slow economies of the other

countries

[34]

CHAPTER 3

Conceptual Discussion

[35]

CONCEPT OF TOPIC

Customer satisfaction, a business term, is a measure of how products and services

supplied by a company meet or surpass customer expectation. Customer satisfaction is

defined as "the number of customers, or percentage of total customers, whose reported

experience with a firm, its products, or its services (ratings) exceeds specified satisfaction

goals."

It is seen as a key performance indicator within business and is part of the four of a

Balanced Scorecard. In a competitive marketplace where businesses compete for

customers, customer satisfaction is seen as a key differentiator and increasingly has

become a key element of business strategy.

Within organizations, customer satisfaction ratings can have powerful effects. They focus

employees on the importance of fulfilling customers’ expectations. Furthermore, when

these ratings dip, they warn of problems that can affect sales and profitability. These

metrics quantify an important dynamic. When a brand has loyal customers, it gains

positive word-of-mouth marketing, which is both free and highly effective.

In researching satisfaction, firms generally ask customers whether their product or

service has met or exceeded expectations. Thus, expectations are a key factor behind

satisfaction. When customers have high expectations and the reality falls short, they will

be disappointed and will likely rate their experience as less than satisfying. For this

reason, a luxury resort, for example, might receive a lower satisfaction rating than a

budget motel—even though its facilities and service would be deemed superior in

“absolute” terms.

The importance of customer satisfaction diminishes when a firm has increased bargaining

power. For example, cell phone plan providers, such as AT&T and Verizon, participate in

an industry that is an oligopoly, where only a few suppliers of a certain product or service

[36]

exist. As such, many cell phone plan contracts have a lot of fine print with provisions that

they would never get away if there were, say, a hundred cell phone plan providers,

because customer satisfaction would be way too low, and customers would easily have

the option of leaving for a better contract offer.

There is a substantial body of empirical literature that establishes the benefits of customer

satisfaction for firms.

Purpose

Customer satisfaction provides a leading indicator of consumer purchase intentions and

loyalty. Customer satisfaction data are among the most frequently collected indicators of

market perceptions. Their principal use is twofold

1. Within organizations, the collection, analysis and dissemination of these data

send a message about the importance of tending to customers and ensuring that

they have a positive experience with the company’s goods and services

2. Although sales or market share can indicate how well a firm is performing

currently, satisfaction is an indicator of how likely it is that the firm’s customers

will make further purchases in the future. Much research has focused on the

relationship between customer satisfaction and retention. Studies indicate that the

ramifications of satisfaction are most strongly realized at the extremes. On a

five-point scale, individuals who rate their satisfaction level as “5” are likely to

become return customers and might even evangelize for the firm. (A second

important metric related to satisfaction is willingness to recommend. This metric

is defined as "The percentage of surveyed customers who indicate that they

would recommend a brand to friends." When a customer is satisfied with a

product, he or she might recommend it to friends, relatives and colleagues. This

can be a powerful marketing advantage.) Individuals who rate their satisfaction

level as “1,” by contrast, are unlikely to return. Further, they can hurt the firm by

making negative comments about it to prospective customers. Willingness to

recommend is a key metric relating to customer satisfaction

[37]

Construction

Organizations need to retain existing customers while targeting non-customers.

Measuring customer satisfaction provides an indication of how successful the

organization is at providing products and/or services to the marketplace.

Customer satisfaction is measured at the individual level, but it is almost always reported

at an aggregate level. It can be, and often is, measured along various dimensions. A hotel,

for example, might ask customers to rate their experience with its front desk and check-in

service, with the room, with the amenities in the room, with the restaurants, and so on.

Additionally, in a holistic sense, the hotel might ask about overall satisfaction “with your

stay.” Customer satisfaction is an abstract concept and the actual manifestation of the

state of satisfaction will vary from person to person and product/service to

product/service. The state of satisfaction depends on a number of both psychological and

physical variables which correlate with satisfaction behaviors such as return and

recommend rate. The level of satisfaction can also vary depending on other factors the

customer, such as other products against which the customer can compare the

organization's products.

Work done by Parasuraman, Zeithaml and Berry between 1985 and 1988 delivered

SERVQUAL which provides the basis for the measurement of customer satisfaction with

a service by using the gap between the customer's expectation of performance and their

perceived experience of performance. This provides the researcher with a satisfaction

"gap" which is semi-quantitative in nature. Cronin and Taylor extended the

disconfirmation theory by combining the "gap" described by Parasuraman, Zeithaml and

Berry as two different measures (perception and expectation) into a single measurement

of performance relative to expectation.

The usual measures of customer satisfaction involve a survey with a set of statements

using a Likert Technique or scale. Customer satisfaction is generally measured on a five-

point scale.

[38]

Customer satisfaction data can also be collected on a 10-point scale

Arguably, consumers are less complex than some of these surveys tend to portend. When

the customer is asked to evaluate each statement in terms of their perception and

expectation of performance of the service being measured, they are basically in two

simple states; satisfied or not satisfied. On or off, just like a switch. A business can

measure its customer satisfaction index by relating the aggregates of satisfied customers

versus dissatisfied customers.

Regardless of the scale used, the objective is to measure customers’ perceived

satisfaction with their experience of a firm’s offerings. Marketers then aggregate these

data into a percentage of top-box responses. Satisfaction levels are usually reported as

either “top box” or, more likely, “top two boxes.” Marketers convert these expressions

into single numbers that show the percentage of respondents who checked either a “4” or

a “5.”

[39]

CHAPTER-4

RESEARCH METHODOLOGY

[40]

4.1 RESEARCH OBJECTIVE

My objective of this research is to know about MC DONALD’S and how does the

company has established in the past years. The research also has an objective to know

how much the brand is loyal in the market among the customers. This research also tells

us about how much competition is there in market and what position is being observed by

MC DONALD’S in the market among its competitors. Customer satisfaction is the main

aspect which is being observed in the research and how much demand is there in the

market.

4.2 RESEARCH DESIGN:

A research design is the arrangement of conditions for collection and analysis of data in a

manner that aims to combine relevance to the research purpose with economy in

procedure. In fact, the research design is a conceptual structure within witch research is

conducted; it constitutes the blue print for the collection, measurement and analysis of

data. As in this type of research we have use the method of descriptive research design.

4.3 DATA COLLECTION:

PRIMARY DATA:

This data can be collected through: The information provided by the customer.Through

the personal interaction with the help of questionnaire. Through the help of surveys done

in small parts where the people are not able to fill questionnaire.

SECONDARY DATA:

This data can be collected through any indirect source of information. I collected using

the following.

Books

Websites

Newspapers

[41]

4.4 QUESTIONNAIRE DESIGN:

We make questionnaire to know which category of people satisfy for which kind of

facilities they are provided and what are there feedback and opinion about the product. In

this category the factors included are such as features, quality, price of the product and

satisfaction of the customers with their product, etc. this include 2 types of

questionnaires.

Open ended questionnaires.

Closed ended questionnaires.

Open ended questionnaires: In this respondents are not bounded to answer within a set of

choices and can give their own views.

Close ended; questionnaires: in this respondents are bounded to answer within a set of

choices.

I have designed my questionnaire of Close ended questions, Dichotomous, Multi choice

as it is more feasible to calculate and collect data from it and would be easily understand

by everyone.

4.5 SAMPLE DESIGN:

4.5.1 SAMPLE UNIT: Customers

4.5.2 SAMPLE TECHNIQUE:

4.5.3 TIME FRAME: 1 Month

4.5.4 SAMPLE SIZE: 50

[42]

4.5.5 LIMITATION OF RESEARCH:

Although the study was carried out with extreme enthusiasm and careful planning there

are several limitations, which handicapped the research viz,

1. Time Constraints:

The time stipulated for the project to be completed is less and thus there are chances that

some information might have been left out, however due care is taken to include all the

relevant information needed.

2. Accuracy:

It is difficult to know if all the respondents gave accurate information;

some respondents tend to give misleading information. It was difficult to find

respondents as they were busy in their schedule, and collection of data was very difficult.

Therefore, the study had to be carried out based on the availability of respondents.

[43]

Chapter 5

Data analysis

[44]

1.When you hear the word burger, does McDonald’s has come in your Mind?

□ Yes  □ No

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 40 80%

2 NO 10 20%

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

OPTIONS

INTERPRETATION

80% of the customers who says YES while 20% people say that if they hear

the word burger, McDonald’s has come in their Mind

[45]

2. In your family who likes to go to McDonald's?

□ Children □ Parents

□ Everyone □ No one

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 Children 12 24%

2 Parents 7 14%

3 Everyone 28 56%

4 No one 3 6%

Children Parents Everyone No one

0%

10%

20%

30%

40%

50%

60%

INTERPRETATION

[46]

24% people says that children likes the most to go to MC Donald’s, 14% people says

parents like to visit it and only 6% says that no one likes to visit MC Donald’s but the

large number of people says everyone likes to go to MC Donald’s

3. With whom do you like to go McDonalds?

□ Friends  □ Family

□ Alone □ Other

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 Friends 12 24%

2 Family 14 28%

3 Alone 5 10%

4 Other 19 38%

[47]

Friends Family Alone Other

0%

5%

10%

15%

20%

25%

30%

35%

40%

INTERPRETATION

24% people will prefer to go with frnds,28% with family,10% alone & 38% with others.

4. How often do you go to McDonald’s?

□ Once a week □ More than once a week

□ Once a month □ Very rarely

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 Once a week 15 30%

2 More than once a week 20 40%

3 Once a month 11 22%

4 Very rarely 4 8%

[48]

Once a week More than once a week

Once a month Very rarely

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

INTERPRETATION

30% people says that they visit mc-d once a week,40% says they visit more then once a

week, 22% says they visit once a month & only 8 % says they visit very rarely

5. With the introduction of new Happy Meal price menu has your number of visits

increased?

□ Yes  □ No

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 36 72%

2 NO 14 28%

[49]

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

80%

OPTIONS

INTERPRETATION

72% people agrees that with the introduction of new Happy Meal price menu the number

of visits increased but 28% disagrees with this

6. What do you like the most in McDonald’s?

□ Food □ Ambience

□ Service □ Other

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

[50]

1 Food 22 44%

2 Ambience 12 24%

3 Service 11 22%

4 Other 5 10%

Food Ambience Service Other

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

INTERPRETATION

44% people answered that they like the food of mc d, 24% likes its ambience, 22% likes

the service & the 10% likes other things

7. How do you rate the service in McDonald’s?

[51]

□ Very good □ Good

□ Average □ Bad

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 Very good 31 62%

2 Good 13 26%

3 Average 5 10%

4 Bad 1 2%

Very good Good Average Bad

0%

10%

20%

30%

40%

50%

60%

70%

INTERPRETATION

[52]

62%people rated the service very good, 26 percent rated it good, 10% rated it average

and the left 2% rated it bad

8. Do you think McDonalds provides 100% Hygienic product?

□ Yes  □ No

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 46 92%

2 NO 4 8%

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

OPTIONS

INTERPRETATION

92% people beliefs that mc d Provides hygienic product and the rest 8 % beliefs that it

does not provide hygienic product

[53]

9. Are you aware that McDonald’s undertake social activities for the growth of children

and other needful people?

□ Yes □ No 

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 34 68%

2 NO 16 32%

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

80%

OPTIONS

INTERPRETATION

Only 68%people were aware that McDonald’s undertake social activities for the growth

of children and other needful people rest are unaware with that.

[54]

10. What is the distance of the nearest McDonald’s from your place?

□ >2k.m. □ <2k.m

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 17 34%

2 NO 33 66%

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

OPTIONS

INTERPRETATION

66%people says that mc d is not with in 2 kms from their place where as 34%

People says that it with in 2 kms.

[55]

11. Do you go to any other fast food shop also?

□ Yes □ No

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 44 88%

2 NO 6 12%

YES NO

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

OPTIONS

INTERPRETATION

88% people states that they visit to other fast food shops also but 12 % people says that

the do not visit any other fast food shop.

[56]

12. If yes then which one?

□ K.F.C □ Dominoes

□ Subway □ Other

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 K.F.C 12 27.27%(Approx)

2 Dominoes 14 31.81%(Approx)

3 Subway 10 22.72%(Approx)

4 Other 8 18.18%(Approx)

K.F.C Dominoes Subway Other

0%

5%

10%

15%

20%

25%

30%

35%

[57]

INTERPRETATION

27% people visit K.F.C., 32%people visits dominoes,23%people visits subway& the rest

18% people visits other fast food stores.

13. How much you are willing to spend at your visit?

□ > Rs.100 □ < Rs.100

SL.NO OPTIONS IN NUMBER IN PERCENTAGE

1 YES 23 46%

2 NO 27 54%

YES NO

0%

10%

20%

30%

40%

50%

60%

OPTIONS

[58]

INTERPRETATION

Only 46% people says that they are willing to spend less then 100 rs. On their visit but

54% are willing to spend more then 100rs.

FINDINGS

[59]

1. The consumers are satisfied with the products given by MC DONALD’S.

2. Most of the people like the food served by the MC DONALD’S and will recommend

other to visit MC DONALD’S

3.In the sample survey we have most of the people are attracted by the logo of the MC

DONALD’S and also in total fast food industry McDonald have the highest sales.

4. Most of the people go to MC DONALD’S to spend there time with there friends.

5.People prefer to go to MC DONALD’S more then once a week.

[60]

RECOMMENDATION

[61]

1. They must improve there services towards there customers.

2. They should start attractive packing for home delivery services.

3.They must do more expenditure on advertisement for the awareness of people.

4. They should increase there items in there menu.

5. They should have affordable price.

[62]

BIBLIOGRAPHY

[63]

BOOKS

PRINCIPLES OF MARKETING by PHILIP KOTTLER & GREY ARMSTRONG

S.P.Sharma, Quantitative Methods,first edition:2005

C.B.Gupta Schiffmen, Consumer Behaviour, fifth edition2007

WEBSITE

www.mcdonaldsindia.com

www.wikipedia.com

www.hindustantimes.com

[64]

ANNEXURE

[65]

QUESTIONNAIRE

Name:______________________________ 

Age:________________________________

Contactnumber:______________________

1.When you hear the word burger, does McDonald’s has come in your Mind?

□ Yes  □ No

2. In your family who likes to go to McDonald's?

□ Children □ Parents

□ Everyone □ No one

3. With whom do you like to go McDonalds?

□ Friends  □ Family

□ Alone □ Other

4. How often do you go to McDonald’s?

□ Once a week □ More than once a week

□ Once a month □ Very rarely

[66]

5. With the introduction of new Happy Meal price menu has your number of visits

increased?

□ Yes  □ No

6. What do you like the most in McDonald’s?

□ Food □ Ambience

□ Service □ Other

7. How do you rate the service in McDonald’s?

□ Very good □ Good

□ Average □ Bad

8. Do you think McDonalds provides 100% Hygienic product?

□ Yes  □ No

9. Are you aware that McDonald’s undertake social activities for the growth of children

and other needful people?

□ Yes □ No 

10. What is the distance of the nearest McDonald’s from your place?

□ >2k.m. □ <2k.m

[67]

11. Do you go to any other fast food shop also?

□ Yes □ No

12. If yes then which one?

□ K.F.C □ Dominoes

□ Subway □ Other

13. How much you are willing to spend at your visit?

□ > Rs.100 □ < Rs.100

[68]