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Mcdonalds restaurants(Just in time and Lean Production concepts) - Research Paper Example

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Mcdonalds restaurants(Just in time and Lean Production concepts)

In an eFS Network, a business, which functions as a B2B marketplace, assists sales as well as acquisitions to the foodservice industry. Main Competitive Base Identifying the value of the supply chain in preserving quality is one of McDonald’s competitive again, and consequently McDonald's plans to form long-term dealings with a restricted amount of suppliers. Suppliers are generally scrutinized to ascertain that they can meet McDonald's necessary standards. Repeat orders indicate that suppliers can be sure of continued existence and development, whereas McDonald’s constantly enjoys consistent, high quality products. McDonald's highlights its firm principles supported by quality, value and hygiene. McDonald’s as well records the source of each product, which allows the business to manage each link within its supply chain (Facella & Genn, 2008). Figure 1: McDonald’s food supply chain structure (Source: McDonald’s) Figure 2: Length of McDonald’s supplier relationships in UK and US (Source: McDonald’s) McDonald’s lately went through drastic strategy alterations to serve their customers in an enhanced manner. In its earlier system, the company would prepare several sandwiches at once, and place in a warming bin until bought by a consumer. Here, management had to forecast how much foodstuff had to be set aside accurately. Accurate forecast had to be employed because if there were not an adequate amount of foodstuff placed on hold, this would generate the issues of rise of waiting times for consumers and a lot of food would create waste of expired products. McDonald’s radically transformed their approach with the intention of staying competitive with other fast food businesses. Inventory Management McDonalds follows a Just in Time (JIT) method of inventory management, which is the system of delivering produce to consumers the moment they have ordered for it, with least delay between order placement and receiving it. McDonalds does not start to cook or preheat its stuff until it gets a customer order. This makes the finished food item in the inventory for the smallest possible time. This facilitates suitable inventory management and decreases leftovers while providing maximum satisfaction to the consumer. Some of the obvious benefits of shifting to JIT system are; (1) Better quality of food - The burgers are prepared fresh for the consumer and therefore, offer utmost satisfaction. Increased customer satisfaction creates consumer retention as well as improved sales. (2) Improved customer service: McDonalds earlier used to make “special orders for customers while dishing out precooked burgers from the inventory to most customers. Hence such special orders were dreaded by the staff and used to freak them out” (Lai & Cheg, 2009); the staff, now following implementation of the JIT system, is more composed and provides improved service to the consumers. This improved customer service is conditional on the capacity to make burgers quicker. McDonalds is capable of dealing with the demand a lot better. It does not have to waste time in determining the approximate sales hour by hour and maintaining inventory. (3) Improved costs: The holding expenses for the raw material such as “bread, beef, cheese, chicken” (Lai & Cheg, 2009) is quite high due to their spoilage costs. In the previous system, McDonalds used to keep a high inventory ...Show more


Running Head: Company Analysis: McDonalds Company Analysis: McDonalds Company Analysis: McDonalds McDonald’s competes within a demanding market division by offering need-fulfilling products to consumers. To maintain its viability, McDonald’s uses a valuable competitive strategy to make it prominent against rivals…
Author : rschumm
Mcdonalds restaurants(Just in time and Lean Production concepts) essay example
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