Is McDonalds a Service or a Manufacturing Corporation?
The McDonald's Corporation is responsible for making sure that its restaurants which are spread throughout the world in more than 100 countries are operating at a standard set by the corporation. McDonald's Corporation functions primarily as an operator of McDonald's restaurants and franchises these restaurants to entrepreneurs who would like to enter into the food service industry. The McDonald's Corporation is also the owner and operator of Boston Market.
Based on the McDonald's Restaurant's slogan of "More than a Billion Served", McDonald's Corporation is basically a food service corporation and not a manufacturing corporation.
Manufacturing is defined as the process of transforming raw materials into finished goods that can be sold. With this definition, putting grilled 100 % beef burger patties in between two pieces of sesame seed buns and adding lettuce, tomatoes and catsup to come up with a McDonald's burger can not be considered as a manufacturing process but a preparation process. McDonald's is not a manufacturing corporation because it does not produce the ingredients that it needs in preparing the different foods that are available in their menu.
The McDonald's Corporation and all its franchisees purchase all the food, packaging, equipment and other goods from suppliers that are not part of the McDonald's Corporation. McDonald's restaurants acquire all the necessary materials from these independent suppliers which have been pre-approved by the McDonald's Corporation. No ingredient is produced by the McDonald's Corporation.
McDonald's Corporation is a service-oriented corporation because it focuses in speedy service and in customer satisfaction. All processes and activities of the McDonald's Corporation, from the purchasing of ingredients and packaging materials, to the distribution of these materials, and to the preparation of the finished products are all geared towards one goal, which is customer satisfaction. A corporation that has customer satisfaction as its major goal is definitely a service corporation.
McDonald's also fall under the definition of a food service corporation since food service is defined as the practice or business of making, transporting, and serving or dispensing prepared foods, as in a restaurant or commissary (The American Heritage Dictionary 2004).
SOURCES:
"Company Profile for MCD". Reuters. http://www.investor.reuters.wallst.com/stocks/company-profile.asp?rpc=66&ticker=MCD
The American Heritage® Dictionary of the English Language, Fourth Edition Copyright © 2004, 2000 by Houghton Mifflin Company. Published by Houghton Mifflin Company
Published by Isra Jensia
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2 Comments
Post a Commentcontinued ... characteristics we can judge any product and place it in a good or service continuum.
Getting back to Mc Donald's, my opinion is that it is somewhere in the middle of this continuum. It has a strong service component revolving around a tangible core product which is fast food. So it cant be called a pure service neither a physical product.
Cheers
"A corporation that has customer satisfaction as its major goal is definitely a service corporation."
Isn't customer satisfaction the major goal of all producers, goods and services alike?. Wouldn't a manufacturer of a bar of chocolate want its customers to be satisfied with it's product.If so can this manufacture be called a service provider? The confusion arises in our perspective of satisfaction, how it is derived. Any product be it a good or a service is purchased because of its perceived benefits by the customer. In other words it is a bundle of satisfaction or utilities that is being purchased. Consider a Ferrari. The core product is land transport. But there is much more to that. The design, color, prestige of brand etc all makes the consumption an experience. So can a Ferrari be considered as a service? The best way to analyze a service is through the 4 characteristics - Intangibility, Inseparability, Heterogeneity and Perishability. By determining the degree of these charact