PESTEL Analysis on McDonalds

McDonalds Corporation is the world largest and widely acknowledged chain of fast food restaurants. McDonald’s offers various fast foods items and soft drinks. This includes burgers, chicken, salads, fries and ice cream. Due to its wide reach globally, McDonald’s revenue grows on daily basis despite being operated by an affiliate, a franchise or by the corporation itself. McDonald’s success in the field can be attributed to its impressive analysis of the macro and micro environment.

The increasing success of McDonald’s corporation can be based on its high standards of performance, competitiveness, marketing strategies, commitment, determination and immeasurable professionalism. Noteworthy, there are thousands of investors who have tried their luck in the fast food industry, but many have not triumphed. Majority have collapsed or incurred unbearable losses. Luckily, by looking at the PESTEL analysis on McDonalds, you can get a glimpse on the overall picture of operations within the industry.

The immaculate tool known as PESTEL analysis is all about the political, economic, social, technological, environmental and legal factors that easily impact a certain business. The McDonalds PESTEL analysis is easy to understand and any investor can gain enough details on how to make worthy investment.

1. Political factors– McDonald’s is not exceptional from other companies as its operations are heavily impacted by policies enforced by the government. For example, there are certain groups in Europe, India and the US that outcry for state actions relating to health effects of fast foods such as obesity and heart infections. The company is also controlled by regulations and individual policies on its operations. There should be good relations with government in providing tax and employment on international platform.
2. Economic factors– For McDonald’s it has to face international rules for business like taxation. The company imports beef and potatoes to fulfil its demand as the local market cannot offer enough products. The company needs to understand the frequency of the changes in the inflation rates and fluctuations when it comes to exchange rates.
3. Social-cultural factors– living standards of many people especially in developing countries are changing fast, hence the high demand for fast foods. McDonalds understands the preferences and needs of these groups and it offers all that they need. the company has also spend quality on research on acts that conform with morals of its targeted clients.
4. Technological context– McDonald’s uses television as it mainstay tool for advertisement of its products. Inventory systems that allow easy payments have been introduced to allow the company to also excel in an international framework.
5. Environment– This organization has been accused of environmental damage due to greenhouse effect by methane gases from the cow’s ranches. They also criticize the company for brutality to animals and slaughtering. Introduction of whale burgers has also caused a loud uproar in Japan as it endangers the species.
6. Legal factors– McDonalds has to take in account legal aspects like taxation, employment standards and quality necessities and much more to excel in its endeavors.

From its humble start, McDonald’s has become a colossal in the fast food industry despite facing many threats. It has enjoyed this success because of its matchless marketing strategy that has made it even easy to excel in the international markets. Needless to say, McDonalds has offered the world a great dining experience that other fast-food providers should try to embrace.

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Online sources:

http://rockansussex.blogspot.com/2013/11/pestel-analysis-of-mcdonalds.html

http://www.scribd.com/doc/82084582/PESTEL-Analysis-of-Mcdonalds

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