Mc Donalds Report

8/11/2019 Mc Donalds Report

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A

Report on

McDonalds Logistics

&

Supply Chain Management

Submitted By:

Name o !nstructor !ncharge

Contents "g# No#

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Abstract $

!ntroduction: %

1.McDonalds in India %

2.Quality,Service, Cleanliness & Value

Literature Re'ie(: )

1.Intricate Supply-Chain et!or" )

Methodology *

Analysis and !nterpretation: +,

1. Supply Chain #rocess ++

2.$utsourced %usiness & Suppliers +%

.'aith is the "ey +

(.Sole distri%ution partner +-

).*e+rierated oveent o+ products +)

.Deand +orecastin +)

/.'ood Sa+ety & Quality assurance +*

0.echnoloy at its %est .,

Learning rom "ro/ect .+

Conclusion .+

Reerences ..

0able o Content

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Abstract

he +oray o+ ultinational +ast +ood retailers into India has ipacted the taste%uds o+ Indian consuers sini+icantly. Instant +ood is scorin over traditional+ood due to in+luence o+ estern countries, and rise in incoe & su%se3uent

standard o+ livin, convenience, etc. 4s a result, +ast +ood enus are ainin!ider acceptance +ro the Indian consuers.

Currently the Indian +ast +ood industry stands at a assive si5e o+ 6(/ %illion,driven %y a ro!in nu%er o+ !or"in pro+essionals and increasin!esterni5ation. 4part +ro this, %usy li+e schedule, standardi5ed +ood, and lesstie consuin processes are also +uellin the deand +ro doesticconsuers in the industry. 4s deand +or all types o+ +ast +ood ites are

consistently on the rise, pi55a, %urer, and 'rench +ries have %ecoe the alltie +avourite aon youn Indians, ore so !ith soe o+ the !ell-"no!n

%urer and pi55a restaurants li"e McDonalds, Doinos, 7'C, #i55a 8ut,Su%!ay, etc operatin in India.

his report ives a %rie+ description a%out the loistics process o+ McDonaldsin India !hich has %est in class QS* ratin.

McDonalds is the !orld leader in QS* 9Quic" Service *estaurant:.heir presence in 110 countries !ith ,;;; restaurants lori+ies its position as!orld leader and as +ast +ood iant. his hue net!or" is not easy to anae!here uest e


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!ntroduction

Internationally, no dou%t McDonalds is considered the larest +ood service

retailer in the !orld. he +irst restaurant !as esta%lished in 1>)) in Des#laines, Illinois, ?S4.McDonald@s is the !orld@s leadin +ood service retailer !ith ore than ,;;;restaurants in110 countries servin ore than / illion custoers each day.It eered in Indian erritory in 1>> eyein the in+oral dinin-out industryin India !hich is estiated at 6/( %illion a year.

In India, the +irst outlets o+ the chain thre! open their doors to the pu%lic inDelhi and Mu%ai in 1>> !ithin one onth o+ each other.

In India, McDonald@s has t!o Indian entrepreneursA1: 4it BatiaA Vice Chairan, 8ardcastle *estaurants #vt. =td, !hich has

%een a!arded a Developent =icensee status %y McDonald@sCorporation, ?.S.4, spearheads McDonald@s operations in est & SouthIndia.

2: Vi"ra a"shi@sA Connauht #la5a *estaurants #rivate =iited,

anain McDonald@s restaurant in orth & ast India !hich is still aBoint Venture !ith McDonald@s Corporation.

McDonalds is present in ore than (; Indian cities !ith 2);E restaurants andserves );,;;; custoers daily.

'or trainin their sta++ copany ta"es all its easure throuh intensive

proraes li"e Supplier Quality Manaeent Systes 9SQMS: and theDistri%utor Quality Maintenance #rora 9DQM#:.

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1uality2 Ser'ice2 Cleanliness & 3alue 41SC & 35:

McDonald@s is driven %y the philosophy o+ Quality, Service, and Cleanliness &Value +or Money. his translates into a coitent to provide custoers hih

3uality products, served 3uic"ly !ith a sile, in a clean and pleasantenvironent at an a++orda%le price. his e++ectively eans that the McDonald@senu is priced at a value that the larest seent o+ the Indian consuers cana++ord, !hile at the sae tie ensurin that 3uality is not sacri+iced +or value -rather,

McDonald@s leveraes econoies to inii5e costs !hile a


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Logistics

=oistics is the anaeent o+ the +lo! o+ oods %et!een the point o+ oriinand the point o+ consuption in order to eet soe re3uireents, o+

custoers or corporations. he resources anaed in loistics can includephysical ites, such as +ood, aterials, anials, e3uipent and li3uids, as !ellas a%stract ites, such as tie, in+oration, particles, and enery. he loisticso+ physical ites usually involves the interation o+ in+oration +lo!, aterialhandlin, production, pac"ain, inventory, transportation, !arehousin, ando+ten security. he cople


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6holesale 0rade

4n econoic indicator that easures the value in ?.S. dollars o+ all erchant!holesalers@ sales and inventories. holesale trade is one coponent o+

%usiness sales and inventories. $nly those +irs !hich sell to overnents,institutions and other %usinesses are considered part o+ !holesale trade.

Retail trade

*etailers are %usiness +irs enaed in o++erin oods and services directly toconsuers. In ostJ%ut not allJcases, retail outlets are priarily concerned!ith sellin erchandise. ypically, such %usinesses sell individual units or

sall roupins o+ products to lare nu%ers o+ custoers. 4 inority o+retailers, ho!ever, also arner incoe throuh rentals rather than outriht saleso+ oods 9as in the case o+ enterprises that o++er +urniture or ardenin tools +orrent: or throuh a co%ination o+ products and services.

Channels o distribution:7

4 channel o+ distri%ution or trade channel is de+ined as the path or route alon

!hich oods ove +ro producers or anu+acturers to ultiate consuers orindustrial users. In other !ords, it is a distri%ution net!or" throuh !hich

producer puts his products in the ar"et and passes it to the actual users. hischannel consists o+ A- producers, consuers or users and the variousiddleen li"e !holesalers,sellin aents and retailers9dealers: !ho intervene

%et!een the producers and consuers. here+ore,the channel serves to %ridethe ap %et!een the point o+ production and the point o+ consuption there%ycreatin tie, place and possession utilities.

4 channel o+ distri%ution consists o+ three types o+ +lo!sA-1. Do!n!ard +lo! o+ oods +ro producers to consuers2. ?p!ard +lo! o+ cash payents +or oods +ro consuers to producers. 'lo! o+ ar"etin in+oration in %oth do!n!ard and up!ard directioni.e. 'lo! o+ in+oration on ne! products, ne! uses o+ e


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Literature Re'ie(

0he !ntricate Supply7Chain Net(or8he strenth o+ McDonalds India eployees aounts >,;;; people includin

restaurant sta++. ut the surprise lies in its uni3ue and intricate supply chainnet!or" !hich is anaed %y ust +ive people across the !hole country.Includin the Quality 4ssurance people, this +iure rises to ust eiht people!ho are all responsi%le +or its e++icient supply chain Indian erritory.

0he Net(or8

he supply-chain net!or" o+ McDonalds is o+ its o!n "indsA

1;; percent outsourced =ean !ith no %ac"-up sta++ and no +rills. he copanyis enoyin ro!th o+ ;-(; percent every year in India. he credit oes to the

proper research !or" done %e+ore launchin McDonalds in India. he e


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Methodology

As per the re9uirements o this pro/ect2 (e collected the data rom

primary and secondary sources#

"rimary Data Source:

e visited the McDonalds $utlet located at eptune Manet Mall at Mulundast, Mu%ai.Store Manaer Mr.-------------- %rie+ed us a%out the loistic process o+ outlet.

8e ust ave us the in+oration a%out ho! they et all the +ood articlesre3uired to prepare +inished products. 8e entioned a%out the *adha"rishna'oodland #vt. =td, distri%ution partner o+ McDonalds and the cold chaintransportation process o+ *7'#s truc"s.

Secondary Data Source:

here is a lot o+ in+oration present on internet a%out the loistics and supplychain anaeent o+ McDonalds, India.e !ere a%le to o%tain a ood aount o+ in+oration +ro McDonaldse%site as !ell other third party !e%site such as Slide share, ICM* India etc.

he in+oration +ro these sources helped in %etter understandin o+McDonalds =oistic and Supply Chain #rocess.

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Supply Chain "rocess

4 McDonald@s %urer is not ust a %urer %ut an outcoe o+ dedicated e++orts%y +arers, its suppliers, distri%ution centre and a +ir proise %yMcDonald@s. McDonald@s contri%utes a reat %ac" end process !hich ena%lesyou to enoy your +avourite %urer +resh & hot, and +or that, the supply chaintruly acts as a %ac"%one o+ the %usiness.

he supply chain %eins at the rass root level, !ith the suppliers receivin thecrop +ro the +arers. he crop is then processed and dispatched to theDistri%ution centres in special teperature controlled truc"s, !hich ensures

that the 3uality o+ the ites is not coproised. hese ites are stored inroos !ith di++erent teperature 5ones and are +inally dispatched to theMcDonald@s restaurants on the %asis o+ their re3uireents. McDonald@se


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Multi7Layered Supply7Chain

he McDonalds supply chain is %oth critical and ulti-layered. here are t!ocateories in +ood inredients supplyL

0ier7! and 0ier7. suppliersA

In 0ier7!there are 1( core suppliers-provide processed products e.. Veeta%leand chic"en patties coes +ro Vista #rocessed +oods #vt =td. , 'rench +ries,

potato !edes and hash %ro!ns %y McCain 'oods India #vt. =td. 4nd so on.

In 0ier7.suppliers there are ro!ers and processors !ho provide lettuce andpotato, poultry ites and coatin systes that are used +or coatin the chic"enand veeta%le patties. he +lo! o+ inredients are +ro ier-2 to ier-Isuppliers !ho process the.

o!, the +leet o+ re+rierated truc"s transport these processed +oods to thecopanys Distri%ution Centers 9DCs:.

hese truc"s have %een speci+ically anoeuvred +or varia%ility o+ McDonaldsproducts. hese are Multi-teperature and sinle teperature truc"s intopractice !here 2); McDonald@s Indian restaurants are provided on tie +astdelivery.

his is not unidirectional, it also include the sini+icant aspect o+ returnloistics. 8ence the epty %ottles and rac"s are availa%le +or +urther

processin. #lastic crates are used +or %uns to ensure their 3uality.

ith +our Distri%ution Centres across the country all 2); restaurants are servede++ectively. 4nd every ne! outlet addition is capa%ly handled %y these DCs!ithin in ten days in the country.

he oida and Mu%ai DCs are priary Distri%ution Centres o!ned %y thecopany. he other t!o Distri%ution Centres are in analore and 7ol"ata arehoused in leased properties. he syste that is used to anae lin" %et!een*estaurant and DCs is a hub7and7spo8e model!here the DCs act as hu%s.

McDonalds transportation has %een copletely outsourced and since 0;percent is re+rierated truc" oveent, the copany has a dedicated +leet!hich transports their oods.

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utsourced Business

he essence o+ the e++ective supply-chain odel is undou%tedly attri%uted toits uni3ue concept o+ outsourcin. he copany has a 1;; percent outsourced

supply chain, !hich is a rare case in industry iants. ut McDonalds hascoplete control over its +unctionin. he per+orances o+ outsourcedcopanies are onitored on 7ey #er+orance Indicators 97#Is:.

he +iure hihlihts the suppleness o+ its supply-chain under three principlesto !hich the copany adheres un!averinly, the principles o+ trust andcolla%oration %et!een the %rand, the o!ners or operators, and the suppliers.McDonalds has a total o+ (; suppliers, in !hich 1( are the core suppliers,"no!n as ier-1 suppliers, they supply directly to the +ast +ood chain.

Suppliers Details:

0ier7! Suppliers:

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Cheese Dynamix Dairy Industries Ltd., Pune

Dehydrated onions Jain Foods, Jalgaon

Iceberg lettuce Trikaya Agriculture, Pune

Chicken atty !ista Foods, Talo"a

!eg. Patty, !eg. nuggets,Pineale#Ale ie

$itran Foods, Talo"a

Chicken %dressed& 'i(erdale, Talegaon

)uns Cremica Industries, Phillaur

*ggless mayonnaise +uaker Cremica P(t. Ltd., Phillaur

esame seeds -haiabad

Iceberg lettuce /eenaAgritech, Delhi

Fish 0illet atties Amalgam Foods Ltd., $ochi.

Iceberg lettuce 1oty Farms 2 1rchards, 1oty

!egetables 0or the attiesFinns Froen Foods 2 Jain Foods%3asik, Jalgaon&

/utton and mutton atties Al $abeer, 4yderabad


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0ier . Suppliers:

(; suppliers-provide =ettuce, Veeta%les, #otato, #oultry 'ars, coatin +orveeta%les& #atties, Dynai< roup, Mrs. ectorsetc & #rocessed products.Veeta%le and chic"en patties coe +ro Vista #rocessed +oods #vt =td,

'rench +ries.

he rest are ier-2 suppliers. *elyin on local players, ost o+ the suppliersare local. Soe internationally +aous +orein players li"e McCain 'oodsIndia are also the part o+ supply tea. McCain set up its Indian %usiness !henMcDonalds ventured into the +ast +ood %usiness in the country.'or supplier to reain in the ain strea, the ters o+ !or" are very riorous.Its a !hole lot o+ responsi%ility !ith 3ualitative assurance lies on suppliers. 4

copanys stellar credentials are not enouhL the suppliers o% does not end!hen the product leaves his preises, rather it ends only !hen the custoerconsues it. McDonalds e


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Sole Distribution "artner

he entire distri%ution o+ McDonalds products in India is handled %y*adha"rishna 'oodland #vt. =td, the only distri%ution partner. *7'= anaesthe +our DCs and since it has a transport division, handles the truc" oveent

in the supply-chain riht throuh the country. McDonalds e


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Rerigerated Mo'ement o "roductshe transportation o+ McDonalds has %een copletely outsourced and 0;F isdone throuh re+rierator truc" oveent. he products are transported in adedicated +leet o+ re+rierated truc"s to the copanys distri%ution centres.

Multi-teperature and sinle teperature truc"s then transport the +ast +oods!i+tly to the McDonalds restaurants across the country. McDonalds have thelarest re+rierated oveent o+ products in India. he oveent o+ edi%leoods is throuh a syste o+ cold chain !here +leets o+ truc" transport all theites, capa%le to carry di++erent ites all toether as there are copartentscreated to store +ro5en products at -10;C to -2);C, chilled products +ro 1;C-(;C and dry products at a%ient teperatures. 4nother +eature is that truc"containers are ade !ith t!o side doors in addition to the rear door. he sidedoors are used to unload products !ithout distur%in the products in the other

teperature 5ones. he entire e++ectiveness o+ supply-chain is %ased on theconcept o+ Opull-supply chain. he restaurant issues orders to the Distri%utionCenter !hich, in turn, routes the order to the supplier and only then does thesupplier produce it. he concept is also "no!n as Pade to orderN. hesupplier thus aintains %arely any e


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;ood Saety & =ACC"

'ood sa+ety is another critical area +or 3uality standard. 'or this 8a5ard4nalysis Critical Control #oint 984CC#: certi+ication !hich ensures +ood3uality is applica%le. his is an industry level certi+ication and is applica%le on

all the suppliers o+ the +ast +ood chain. 4part +ro 84CC#, there are other+ood sa+ety systes li"e the Supplier Quality Manaeent Systes 9SQMS:and the Distri%utor Quality Maintenance #rora 9DQM#: are also in practice.'or processin and anu+acturin plants SQMS is applica%le. he SQMS is a!orld!ide andate +or all McDonalds suppliers and includes essentials o+ the84CC# control syste, !hile also contrivin several principles o+ its o!n.he DQMS audits and chec"s the !arehouses o+ the chain.

4uditors !orld!ide are also trained on its SQMS and DQM# proras.Independent auditors then audit plants and !arehouses and allot scores toMcDonalds +acilities lo%ally to ensure hihest standards.

1uality Assurance

aste o+ the +ood products is another paraeter o+ Quality. 'or thisMcDonalds has developed a Sensory #rora.he centrali5ed la%oratory +or this prora is located in 8on 7on !hich

prepares sensory e


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0echnology at its Best

he entire syste o+ supply chain is po!ered %y technoloy to a"e it soothand e++ortless.

Suppliers are usin S4# !hile Distri%ution Centers are on *4MC$ Marshall*# !ith Co%ra so+t!are.

hese systes are used to autoi5ed upload o+ store orders. 'or assistin inday to day +unctions o+ store, technoloies have %een developed e.. trac"sales, ena%les restaurants to schedule sta++ and send +orecast orders to DCs, etc.

he copany is tappin the hih ro!th opportunities !ith custoer

satis+action criteria e++ectively and in this e++ort McDonalds addedMcDelivery, an innovative option !hich delivers eals to the custoersdoorstep.his service has ro!n at stratospheric levels %y ore than (;; percent.McDelivery !as +irst launched in Mu%ai and Delhi in 2;;(.

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Learnings and Conclusion

McDonalds Supply Chain is 3uite uni3uely handled !ith least nu%er o+eployees on McDonalds payroll. he control on outsourced entities is

coenda%le. ith ever ro!in %usiness o+ +ast +ood McDonalds has laiddo!n its systes e++iciently and e


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Reerences

+ http:>>(((#mcdonalds#com>us>en>our?story#html

. http:>>(((#mcdonaldsindia#com>aboutus#html

$ http:>>(((#ood7ser'ice7europe#com>trendscout>hottrends>pages>% http:>>(((#icmrindia#org>ree@.,resources>casestudies>McDonald

@.,ood@.,ch ain#htm

http:>>sourcing$#com>blog>mcdonalds7india7supply7chain>$>

- http:>>logistics#baree#net>mcdonalds7india7supply7chain>

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Mc Donalds Report