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    DECLARATION

    I, NEHA DATTANI of LORDS UNIVERSAL COLLEGE,

    TYBMS (Semester V), hereby declare that I have completed this

    project on MATERIAL MANAGEMENT OF MCDONALDSIN

    INDIAin the Academic Year 2009-2010.

    The information submitted in this project is true and original to the

    best of my knowledge.

    SIGNATURE OF THE STUDENT

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    CERTIFICATE

    I, PROF. VIPIN SABOOhereby certify that NEHA DATTANIof

    LORDS UNIVERSAL COLLEGE of T.Y.BMS (Semester V) has

    completed the project on MATERIAL MANAGEMENT OF

    MCDONALDSIN INDIA in the academic year 2009-2010.

    The information submitted in this project is true and original to the

    best of knowledge.

    SIGNATURE OF THE PROJECT GUIDE

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    ACKNOWLEDGEMENT

    I would like to thank the University of Mumbaiand Lords Universal Collegefor

    giving me this opportunity to research and make this project. I would also like

    to thank my Project Guide Prof. Vipin Saboofor his sincere support and

    interest.

    Also, Special Thanks to:

    Prof. Shikta Roy

    Principal, Lords Universal College

    Prof. Neha

    BMS Co-ordinator, Lords Universal College

    Prof. Hitesh Thakkar

    Professor (HRM & RM), Lords Universal College

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    EXECUTIVE SUMMARY

    Dissertation Title:- Material Management of McDonalds in India.

    FacultyGuide: Prof. Vipin Saboo.

    Nameofstudent:Neha Dattani.

    In India day-by-day many multi-nationals are entering the market in

    various different field of business. And most importantly the customers are very

    excited about it because our country is actually getting benefitted by the arrival of

    these MNCs. In todays scenario common man has become too busy to cook at

    home, they prefer fast food or ready-made food.

    The entrance of McDonalds in India in October 1996 at Basant Lok and

    its expansion and success started touching skies. McDonalds is loyal to all its

    customers.

    This project gives a brief about the material management of McDonalds.

    The most important reason/motive behind studying this is that how did they

    manage to provide the international standard and quality products in India and

    how did they succeed in handling their raw material as the food available in

    McDonalds is so fresh and tasty.

    All the raw material is produced in India itself and it is further processed to

    bring that unique taste of McDonalds and then supplied to the different

    franchises through refrigerated transportation on the right time.

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    Contents Page No.

    Acknowledgement 4

    Executive summary 5

    Table of Contents 6

    Ch.1. Project Motive 7

    1.1. Why did I select this topic?

    1.2. Objectives of the project

    Ch.2. Introduction of Material Management 8

    Ch.3. Introduction of McDonalds 13

    Ch.4. McDonalds Working process 16

    Ch.5. Material management of McDonalds 18

    Ch.6. Organisational structure of McDonalds 21

    Ch.7. McDonalds Indian Supply Chain 23

    Ch.8. McDonalds Suppliers 30

    Ch.9. Directors Statement 40

    Ch.10. McDonalds Indias Cold Chain 41

    Ch.11. Inventory 44

    Ch.12. Execution of a new product 49

    Ch.13. SWOT Analysis of Materials 50

    Ch.14. Findings of the study 51

    Ch.15. Conclusion 54

    Ch.16. References 55

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    Ch. 1. Project Motive

    Why did I select this topic?

    Following are the reasons for selecting the topic Material Management of McDonalds

    for 100 marks project:

    Managing the material department of any manufacturing organisation is vital for

    each and every firm so that to have an idea about it by studying this topic.

    Any mistake or carelessness in managing and keeping a track on the materials to

    be bought and processed and maintained can bring the company into losses and

    stoppage as well.

    In order to gain in depth knowledge of one of the most important aspects of a

    manufacturing company I selected this topic of Material Management of

    McDonalds because food industry is very booming.

    Objectives of the project

    This project is made with certain objectives which are as follows:

    To learn the material management process of manufacturing organisation.

    To know how McDonalds succeeded in its material operations in India.

    To study how important is a material department in any organisation.

    To learn the roles and functions played by a material department.

    To analyse safety measures taken in maintaining the quality of raw material.

    To maintain the level of cost in handling the material right from ordering till

    processing.

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    Ch. 2. Introduction of Material Management

    Materials management is the branch of logistics that deals with the tangible

    components of asupply chain.Specifically, this covers the acquisition of spare parts

    and replacements,quality control of purchasing and ordering such parts, and the

    standards involved in ordering, shipping, and warehousing the said parts.

    Areas of Concentration

    Goals

    The goal of materials management is to consolidate and efficiently handle core

    services. It creates truck deliveries and service vehicle routes that reduce conflicts for

    vehicles and pedestrians. Delivery sites and loading docks are more effective and

    reduce redundancy. Cost is reduced when it comes to solid and hazardous waste

    removal, storage, and recycling. Utility infrastructure and service equipment relocation

    can improve aesthetics.

    Quality Assurance

    A large component of materials management is ensuring that parts and materials

    used in the supply chain meet minimum requirements by performing quality assurance

    (QA). While most of the writing and discussion about materials management is on

    acquisition and standards, much of the day to day work conducted in materials

    management deals with QA issues. Parts and material are tested, both before purchase

    orders are placed and during use, to ensure there are no short or long term issues that

    would disrupt the supply chain. This aspect of material management is most important

    heavily automated industries, since failure rates due to faulty parts can slow or even

    stop production lines, throwing off timetables for production goals.

    http://en.wikipedia.org/wiki/Supply_chainhttp://en.wikipedia.org/wiki/Quality_controlhttp://en.wikipedia.org/wiki/Quality_controlhttp://en.wikipedia.org/wiki/Supply_chain
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    Standards

    The other major component of materials management is standards compliance.

    There are standards that are followed in supply chain management that are critical to a

    supply chain's function. For example, a supply chain that uses just-in-time or lean

    replenishment requires absolute perfection in the shipping of parts and material from

    purchasing agent to warehouse to place of destination. Systems reliant on vendor-

    managed inventories must have up-to-date computerized inventories and robust

    ordering systems for outlying vendors to place orders on. Materials management

    typically insures that the warehousing and shipping of such components as are needed

    follows the standards required to avoid problems. This component of materials

    management is the fastest changing part, due to recent innovations in SCM and in

    logistics in general, including outsourced management of warehousing, mobile

    computing, and real-time logistical inventories.

    Promoting Sustainability

    Many business and institutional campuses have cluttered, noisy, and oftentimes

    inefficient service environments. Delivery trucks compete with pedestrians, loading

    docks are in plain sight, trash dumpsters sprout up, and lobbies, hallways, and stairwells

    are cluttered with unplanned storage. With forethought and creativity, these systems can

    reduce energy use and carbon emissions, minimize traffic congestion, streamline

    operational flows, and enhance esthetics.

    Improving circulation infrastructure

    Redundancy can be reduced and effectiveness is increased when service points

    are clustered to reduce the amount of redundancy. An effective materials management

    program can also resolve island approaches to shipping, receiving, and vehicle

    movement. Solutions can include creating a new central loading location, as well

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    consolidating service areas and docks from separate buildings into one. Developing

    better campus circulation infrastructure also means re-evaluating truck delivery and

    service vehicle routes. Vehicle type, size, and schedules are studied to make these more

    compatible with surrounding neighborhoods. This will reduce truck traffic, creating a

    safer environment for pedestrians and a more attractive environment for other uses.

    Materials Management Week

    Each year, an entire week is dedicated to celebrating resource and materials

    management professionals for their outstanding contributions to healthcare and the

    overall success of the supply chain. Sponsored by the Association for Healthcare

    Resource & Materials Management (AHRMM), National Healthcare Resource &

    Materials Management Week (MM Week) provides an opportunity to recognize the

    integral role materials management professionals play in delivering high-quality patient

    care throughout the health care industry. In 2009 Material Management Week is

    October 4-10 October.

    Benefits

    An effective materials management plan builds from and enhances an

    institutional master plan by filling in the gaps and producing an environmentally

    responsible and efficient outcome. An institutional campus, office, or housing complex

    can expect a myriad of benefits from an effective materials management plan. For

    starters, there are long-term cost savings, as consolidating, reconfiguring, and better

    managing a campus core infrastructure reduces annual operating costs. An institutional

    campus, office, or housing complex will also get the highest and best use out of campus

    real estate.

    An effective materials management plan also means a more holistic approach to

    managing vehicle use and emissions, solid waste, hazardous waste, recycling, and

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    utility services. As a result, this means a greener, more sustainable environment and a

    manifestation of the many demands today for institutions to become more

    environmentally friendly. In fact, thanks to such environmental advantages, creative

    materials management plans may qualify for LEED Innovation in Design credits.

    And finally, an effective materials management plan can improve aesthetics.

    Removing unsafe and unsightly conditions, placing core services out of sight, and

    creating a more pedestrian-friendly environment will improve the visual and physical

    sense of place for those who live and work there.

    Dredged Material Management

    Three management alternatives may be considered for dredged material: open-

    water disposal, confined (diked) disposal, and beneficial use. Open-water disposal is the

    placement of dredged material in rivers, lakes, estuaries, or oceans via pipeline or

    release from hopper dredges or barges. Confined disposal is placement of dredged

    material within diked nearshore or upland confined disposal facilities via pipeline or

    other means.

    Potential environmental impacts resulting from dredged material disposal may

    be physical, chemical, or biological in nature. Because many of the waterways are

    located in industrial and urban areas, sediments often contain contaminants from these

    sources. Unless properly managed, dredging and disposal of contaminated sediment can

    adversely affect water quality and aquatic or terrestrial organisms. Sound planning,

    design, and management of projects are essential if dredged material disposal is to be

    accomplished with appropriate environmental protection and in an efficient manner.

    Beneficial Use

    Ten broad categories of beneficial uses have been identified, based on the functional

    use of the dredged material or site. They are:Habitat restoration/enhancement (wetland, upland, island, and aquatic sites

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    including use by waterfowl and other birds).

    Beach nourishment.

    Aquaculture.

    Parks and recreation (commercial and noncommercial).

    Agriculture, forestry, and horticulture.

    Strip mine reclamation and landfill cover for solid waste management.

    Shoreline stabilization and erosion control (fills, artificial reefs, submerged

    berms, etc.).

    Construction and industrial use (including port development, airports, urban, and

    residential).

    Material transfer (fill, dikes, levees, parking lots, and roads).

    Multiple purpose.

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    Ch. 3. Introduction of McDonalds:

    McDonalds is actually U.S. based organisation but it started spreading branches

    all over the world with the arrival in India.

    McDonalds India:

    McDonalds in India is a locally owned and managed company run by Indians,

    employing local staff, procures from local suppliers to serve its customers. McDonalds

    India opened its first family restaurant at Basant Lok in Oct, 1996; today it has 132

    Restaurants across India.This vibrant decade has seen McDonald's evolve Indian

    menus, Indian sensitivities and yet remain as globally innovative as ever. This journey

    has seen McDonald'sdevelop a rich brand identity amongst its customers and

    employees as well as partners alike.

    At McDonalds India we have had a single formula: providing 100% total customer

    satisfaction and the formula for achieving this goal in our restaurant operation is the

    long-standing commitment to the McDonalds Promise.

    They vowed to give its customers high quality products, served quickly and with

    a smile, in a clean and pleasant environment, and all at a fair price. Quality, Service,

    Cleanliness and Value (QSCV) became the philosophy that drove McDonalds

    business.

    McDonalds worldwide is well known for the high degree of respect to the local

    culture. McDonalds has developed a menu especially for India with vegetarian

    selections to sit Indian taste and culture. In line with its respect for local culture, India is

    the first country in the world where McDonalds does not offer any beef or pork items.

    McDonalds has also re-engineered its operations to address the special requirements of

    vegetarians. Special care is taken to ensure that the vegetable products are prepared

    separately, using dedicated equipments and utensils. This separation of vegetarian and

    non-vegetarian food is maintained throughout the various stages of procurement,

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    cooking and serving. So much that the mayonnaise and the soft serve are also 100%

    vegetarian. Also in India, only vegetable oil is used as a cooking medium.

    QSCV

    McDonalds Quality Management instils the culture of quality through such

    principles as being customer driven, managing with facts, valuing people, and

    continually improving every aspect of our business.

    Service that is fast and friendly and has always been a foundation for success at

    McDonalds.

    Cleanliness for us means having the cleanest and freshest facilities from the

    kitchen to the rest rooms and parking lots.

    Value at McDonalds means the total experience ......... great food, friendly folks,

    a clean environment, quick and accurate service and fun!

    In keeping with McDonalds commitment worldwide, McDonalds India serves

    only the highest quality products. The attention to food quality started long before the

    first restaurant opened. McDonalds India has established closed relationships with

    local suppliers who provide McDonalds with the highest quality and freshest

    ingredients to make its products.

    Company Profile:

    McDonald's India Culturally

    Sensitive

    McDonald's worldwide is well known for the

    high degree of respect for the local customs

    and culture. McDonalds has developed a

    menu especially for India with vegetarian

    selections to suit Indian tastes and

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    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

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    Ch. 4. McDonalds Working Process

    Diagrammatically theworking processof McDonalds can be represented as follows:

    Buying:

    McDonalds India today purchases more than 96% of its products and supplies

    from Indian suppliers from Indian suppliers. Even their restaurants are constructed

    using local content in materials.

    The philosophy at McDonalds is to develop a collaborative approach with their

    suppliers. The relationship between McDonalds and its India suppliers gets the

    opportunity to expand his business, have access to the latest in food technology.

    Processing:

    McDonalds has also re-engineering 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 equipments and utensils

    Only pure vegetarian oil in used as a cooking medium.Cheese and sauces are completely vegetarian and eggless.

    Buying

    Processing

    Selling

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    Separation of vegetarian and non-vegetarian food products is maintained

    throughout the various stages of procurement, cooking and serving.

    Selling:

    The sales of McDonalds are extremely good as it provides best quality at a

    reasonable rate. It has created a brand image and set the customers mind to buy its

    products. They take great efforts to ensure that their vegetarian products are kept

    distinctly from their non-vegetarian products till they are served to their customers. All

    their vegetarian products are 100% vegetarian.

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    Ch. 5. Material Management of McDonalds:

    Economic make or buy:

    McDonalds follows the principle of make & then sell as it buys the raw

    materials and puts it into a process to get the final finished product and then sells it to

    the consumer which is economical for both consumers as well as producers.

    Standardisation:

    Serving the customers great tasting, high quality food is the top priority. All

    menu items are prepared for the customers under a carefully monitored process using

    specialised equipment. For example, they conduct a series of tests and restaurant audits

    everyday to ensure that the procedures are being followed and the high standards are

    being met.

    Objectives

    of

    McDonald's Material

    Dept.

    Standardisation

    Development

    of good

    records

    Regulating

    Inventory

    Good relation

    with supplier

    Product

    improving

    Favourable

    reciprocal

    relation

    Achieving the

    objectives

    Economic

    make or buy

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    Development of good records:

    By not only providing quality goods but also rendering best services

    McDonalds has developed a long list of good records with the customers. Even with its

    employees and suppliers it has maintained good relationships and goodwill in the

    market of hotel and food industry.

    Regulating inventory:

    Since the records of the transactions of McDonalds are kept, they can point out

    the need for regulating, modification or adoption of new inventory strategies.

    Good relation with suppliers:

    They have committed long-term relationships with their suppliers. Through

    openness and trust they are developing a strong supply chain that is sustainable and

    industry leading.

    Product improvement:

    A key part of McDonalds philosophy is its continuous improvement, not only in

    the restaurants but with its primary and secondary suppliers as well. As performance

    trends prove the value of this approach. As per the customers needs and expectations

    they have improved their quality as and when required.

    Favourable reciprocal relations:

    Favourable reciprocal relation refers to the relation maintained by the suppliers

    and consumers towards McDonalds. Supplier is maintaining good relationship by

    providing raw materials at the time of emergencies and similarly consumers maintain

    such relation by giving proper feedback and response to them.

    Achieving the objectives:

    They believe in gaining all the objectives of their material management for ggod

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    quality products and better services.

    Thus, the basic objective of McDonalds material department is to buy and standardize

    the product, maintain good relation with both consumer and supplier. They provide

    quality service at the price of the right quantity at the right time and the right place.

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    Ch. 6. Organizational structure of McDonalds:

    The organizational structure of McDonalds material department is a combined

    set up of materials as well as finance. The head of the franchise appoints two managers

    under him, one for the material management and the other for finance management. The

    appointed managers have to perform the assigned task as follows:

    The two senior departmental managers i.e. the material manager and the finance

    manager, working under the head of McDonalds, manage all the areas of a particularzone assigned to them.

    Each area manager managing their different franchise looks after purchasing of

    raw material, processing of the same to get the finished product then storing the raw

    material and packing the final product for final sale. He even manages to maintain the

    machine as well as utensils which are delicate.

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    All the area-wise general managers have to consult the senior departmental

    managers for the supply of materials and payment as well. And the two departmental

    managers have to keep on informing the head of McDonalds regarding the business.

    This entire material set up of McDonalds follows the rule of Combined

    material management.

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    Ch. 7. McDonalds India Supply Chain:

    Supply Chain is one of the critical factors for the smooth functioning of any

    business. And when we are talking about fast food business with McDonalds as the

    subject of the study it can expect a Supply Chain model of one of the highest precisions.

    It is this unmatched Supply Chain Structure, which not just ensures on time delivery of

    raw materials and supplies to McDonalds but also enables it to cut down on its cost and

    maximize profitability along with maintaining highest quality standards of its products.

    The level of commitment of McDonalds can be gauged from the fact that even before it

    set up its first restaurant in the country it infused Rs 400 Crore to set up its delivery

    mechanism. McDonalds initiative to set up an efficient supply chain and deploy state-

    of-art technology changed the entire Indian fast food industry and raised the standards

    of performance to international levels.

    As already mentioned, McDonalds had been working on its supply chain even

    before it opened its first joint in the country. McDonalds, an international brand which

    was trying to make inroads into the country, developed its Indian partners in such a

    manner that they stayed with the company from the beginning. The success of

    McDonalds India was achieved by sourcing all its required products from within the

    country. To ensure this, McDonalds developed local businesses, which can supply it

    highest quality products. Today, McDonalds India works with 38 different suppliers on

    a long term basis and several other stand alone restaurants for its various other

    requirements. McDonalds distribution centres in India came in the following order:

    Noida and Kalamboli (Mumbai) in 1996, Bangalore in 2004, and the latest one in

    Kolkata (2007). McDonald's entered its first distribution partnership agreement with

    Radha Krishna Foodland, a part of the Radha Krishna Group engaged in food-related

    service businesses. The association goes back to July 1993, when it studied the nuances

    of McDonald's operations and requirements for the Indian market. As distribution

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    centres, the company was responsible for procurement, the quality inspection

    programme, storage, inventory management, deliveries to the restaurants and data

    collection, recording and reporting. Value-added services like shredding of lettuce, re-

    packing of promotional items continued since then at the centres playing a vital role in

    maintaining the integrity of the products throughout the entire 'cold chain'.

    Cold Chain was one of the unique concepts of McDonalds supply chain in India,

    on which it had spent more than six years to get the system into place. This system

    brought about a veritable revolution, immensely benefiting the farmers at one end and

    enabling customers at retail counters get the highest quality food products, absolutely

    fresh and at great value. Through its unique cold chain, McDonalds has been able to

    both cut down on its operational wastage, as well as maintain the freshness and

    nutritional value of raw and processed food products. This has involved procurement,

    warehousing, transportation and retailing of perishable food products, all under

    controlled temperatures. The following list of suppliers, who build up the major supply

    chain of McDonalds, reveal how this Cold Chain

    works and contributes towards the

    efficiency of McDonalds.

    Potato farming in Gujarat:

    Sourcing the right potato

    Even prior to its entry into India,

    McDonalds was committed to working with

    local suppliers and farmers to source all its

    requirements. The company therefore spent 6

    years and around Rs.450 crore to set up the food

    supply chain even before opening its first

    restaurant in the country.

    India despite being the worlds second

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    largest producer of food, losses nearly Rs.50,000/- crore worth of food produce due to

    wastage at various levels, especially due to lack of proper infrastructure for storage and

    transportation. McDonalds India has pioneered the cold chain management system

    wherein the freshness, crispness and the nutritional value of vegetables and processed

    products are retained.

    In 1991, McDonalds was looking for a particular variety of potato for

    manufacturing its world famous French fries. One of McDonalds suppliers - Lamb

    Weston - invested heavily in setting up production lines to process these potatoes to

    make the fries. However production was discontinued, as the right quality of potatoes

    could not be sourced.

    The right quality of potato in India was unavailable as farmers used seeds from

    the preceding crop, which in turn resulted in a single variety and poor quality potatoes.

    McDonalds needed the process-grade variety of potato for its products, which are as

    per McDonalds international quality standards.

    The variety of potato required by McDonalds had to have a certain length, high

    solids content and low moisture content while the ones that were available were of

    table-grade variety. Nonetheless, as per its initial commitment to local sourcing,

    McDonalds and its supplier partner, McCain Foods Pvt. Ltd., began to work closely

    with farmers in Gujarat and Maharashtra to develop process-grade potato varieties.

    McCain Foods Pvt. Ltd. is the worlds largest French Fry Company in the world.

    Established in 1957, today it is a brand that is known and respected in more than 100

    countries, generating worldwide sales of more than $5.5 billion. It has more than 55

    processing plants on 4 continents (29 of which are French fry and potato speciality

    facilities) and exports to more than 80 countries worldwide.

    Leaders in agronomy, technology and innovation, McCain Foods Pvt. Ltd.

    partnered with McDonalds to work with farmers in Gujarat (specifically the towns of

    Deesa and Kheda) to interact with agronomists and field assistance to demonstrate thebest practicesright from better agronomy techniques like irrigation system, sowing

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    seed treatments, planting methods, fertilizer application programmes and better storage

    methods for the produce. In addition to this, the farmers also benefits through

    incremental monetary gains as they sell directly to McCain Food Pvt. Ltd. instead of

    commission agents. The result of these efforts has been that now the Gujarat potato

    crop has been utilised to make McDonalds Chatpatey Potato Wedges.

    McDonald's-Outsourcing the ingredients

    Cheese Dynamix Dairy Industries Ltd., Pune

    Dehydrated onions Jain Foods, Jalgaon

    Iceberg lettuce Trikaya Agriculture, Pune; Meena Agritech, New Delhi;Ooty Farms and Orchards, Ooty

    Chicken patty Vista Foods, Taloja

    Veg. Patty, Veg. Nuggets,Pineapple pie, Apple pie

    Kitran Foods, Taloja

    Chicken (dressed) Riverdale, Talegaon

    Buns Cremica Industries, Phillaur

    Eggless mayonnaise Quaker Cremica Pvt. Ltd., Phillaur

    Sesame seeds Ghaziabad

    Fish fillet patties Amalgam Foods Ltd., Kochi.

    Vegetable for the patties Finns Frozen Foods, Nasik and Jain Foods, Jalgaon

    Mutton and Mutton Patties Al Kabeer, Hyderabad

    Their experience also tells us that many companies, for want of a cost-effective

    and reliable logistics solution, end up deciding not to market their products which are of

    a perishable nature in certain markets, thus losing out on potential revenue

    opportunities. And because currently, there is no reliable service provider to cater to

    this need, companies have to move goods either by air, which is expensive, or through

    bulk carriers with very little control on the delivery schedule. Given the current

    scenario, combined with their domain expertise in the logistics & distribution area, they

    have launched a new service - Fresh Rush. Fresh Rushis a temperature controlled

    transportation service addressing the needs of small volume cargo.

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    Fresh RushFeatures

    Multi temperature products, such as Frozen (below18C) and Chilled (1C to

    4C) can be transported

    Flexibility of load movement - A minimum of 500 kgs to maximum of 5000 kgs

    can be transported

    In transit temperature tracking

    Fixed schedule of pickup and delivery

    Well trained and experienced manpower

    Adherence to strict hygiene standards

    Consignment can be tracked through GPS system

    1. Food Park, Kalamboli

    First of its kind in India

    Designed as per global standards

    The centre procures, value adds, stores

    and distributes various kinds of

    perishable and non-perishable food products

    Food ParkFeatures

    Spread over 33,000 sq meters

    Multi Temperature Zones

    Integrated FacilityStorage and Value Addition capabilities under one roof

    Ensured / Guaranteed Food Safety

    Paradigm shift in the way food is handled in the supply chain in India

    First of its kind in the region

    Benchmarked against global standards

    Codex / USDA / PFA compliant

    ScalableDedicated storage for specific categories

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    Sanitation / Hygiene standardsTrash handling

    Air / Water QualityTreatment Plant / ETP

    Ripening Rooms, Crate Wash Facilities, Blast Freezer, Flake Ice Machine

    Value Added ServicesProcessing of Vegetables & Fruits, Meat, Sea Food and

    Poultry

    ControlsBuilding Management System (BMS)

    100 % Power Back Up

    Food ParkCapacity

    Capacity to manage over 6000

    SKUs

    Can store 70,000 cases with 1,700

    pallet positions and over 4,000

    pick faces

    Processing

    Vegetable & Fruits21 tonnes per day

    Meat3 tonnes per day

    Fish3 tonnes per day

    Blast Freezing6 tonnesper day

    Ice Machine2.4 tonnes per day

    2. Kanjur Marg DC

    Spread over 3,500 sq meters

    Dry Provisions DC

    Capacity to manage over 9000 SKUs

    Can store 80,000 cases with 1400 pallet position and 3,600 pick faces

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    3. Delhi DC (Noida)

    Dedicated to operations in the North

    Highly functional DC

    Chiller / Freezer / Dry Storage

    Capacity to manage 576 pallet positions

    McDonalds Strategies:

    It understands customers needs like:

    What customers want? (Product and Price)

    When customers want? (Time)

    Where customers want? (Place)

    Why customers want? (Purpose/Frequency)

    How customers want? (Convenience)

    BestProduct(Quality)

    At lowestprice(Cost)

    FastestDelivery(Time)

    Customer

    Satified

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    Ch. 8. McDonaldsSuppliers:

    As McDonalds products (Bread, Cheese, Vegetables, Milk, Mayonnaise, Meat,

    etc.) are highly perishable, so they require it daily but they purchase on weekly basis as

    per the requirement. Since the material is perishable and it is bought weekly, so they

    have to arrange cold storage facility for the materials.

    Since the different material is produced at different places and they have to

    transport it to the specific zone, they have a single main warehouse for a particular

    zone. The area managers have their own warehouses for storing as they purchase

    weekly from the zonal warehouse.

    All the suppliers are HACCP certified. The suppliers of the above mentioned

    raw materials are as follows:

    Trikaya Agriculture- Supplier of Iceberg Lettuce (a kind of

    vegetable)

    McDonalds India benefits

    other Indian business through

    local sourcing. Worldwide, too,

    McDonalds India had brought

    benefits consistently to the

    community by working with

    local businesses, which could

    grow as McDonalds grew. By

    forming partnership with the

    local suppliers, based on trust

    and mutual desire to grow, McDonalds has set the stage for enormous success of a

    large number of companies from which it purchases supplies and services.

    Working with these local suppliers, McDonalds and its international supplier

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    network have helped transfer advanced technology and state-of-the-art procedures in

    the areas of agriculture, food processing, warehousing and distribution, restaurant

    equipment manufacturing, restaurant operations and other disciplines related to the food

    service industry to them.

    For example, McDonalds partnership with local produce suppliers has stimulated

    the introduction of new farming techniques and widened geographic areas of

    production. Agricultural suppliers to the company are now employing the most current

    farming practicesresulting in better cropping patterns, greater yields and higher farm

    income and increased jobs with the rural farming sector.

    One of the best examples of this supplier development is Trikaya Agriculture.

    Implementation of advanced agricultural practices has enabled Trikaya to successfully

    grow specialty crops like iceberg lettuce, special herbs and many oriental vegetables.

    Farm infrastructure features:

    Drip and sprinkle irrigation in raised farm beds with fertilizer mixing plant.

    Pre-cooling room and a large cold room for post harvest handling.

    Refrigerated truck for transportation.

    Depending on the area, the consumption of the Iceberg Lettuce differs.

    On an average 30kgs of Iceberg lettuce is required in each franchise every

    day.

    A specialized nursery with a team of agricultural experts.

    Trikaya Agriculture, a major supplier of iceberg lettuce to McDonald's India, is

    one such enterprise that is an intrinsic part of the cold chain. Exposure to better

    agricultural management practices and sharing of advanced agricultural technology by

    McDonald's has made Trikaya Agriculture extremely conscious of delivering its

    products with utmost care and quality. Initially lettuce could only be grown during the

    winter months but with McDonald's expertise in the area of agriculture, Trikaya Farms

    in Talegaon, Maharashtra, is now able to grow this crop all the year round. McDonald'shas provided assistance in the selection of high quality seeds, exposed the farms to

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    advanced drip-irrigation technology, and helped develop a refrigerated transportation

    system allowing a small agri-business in Maharashtra to provide fresh, high-quality

    lettuce to McDonald's urban restaurant locations thousands of kilometres away. Post

    harvest facilities at Trikaya include a cold chain consisting of a pre-cooling room to

    remove field heat, a large cold room and a refrigerated van for transportation where the

    temperature and the relative humidity of the crop is maintained between 1 C and 4 C

    and 95% respectively. Vegetables are moved into the pre-cooling room within half an

    hour of harvesting. The pre-cooling room ensures rapid vacuum cooling to 2 C within

    90 minutes. The pack house, pre-cooling and cold room are located at the farms itself,

    ensuring no delay between harvesting, pre-cooling, packaging and cold storage. With

    this cold chain infrastructure in place, Trikaya Agriculture has also a plan to export this

    high value product to other international markets, especially to McDonald's Middle East

    and Asia Pacific operations. McDonald's expertise in packaging, handling and long-

    distance transportation has helped Trikaya to do trial shipments to the Gulf

    successfully. In addition to export, McDonald's assistance has enabled Trikaya

    Agriculture to supply this crop to a number of star-rated hotels, clubs, flight kitchens

    and offshore catering companies all over India.

    Vista Processed Foods Pvt. Ltd.Supplier of Chicken and Bread

    range of products:

    A joint venture with OSI Industries Inc., USA,

    and McDonalds India Pvt. Ltd. produces a range of

    frozen chicken and bread. A world class infrastructure

    at its plant at Taloja, Maharashtra, has:

    Separate processing lines for chicken and

    bread.

    Capability to produce frozen foods at a

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    star-rated hotels, hospitals, project sites, caterers, corporate canteens, schools and

    colleges, restaurants, food service establishments and coffee shops. Today, production

    of better quality frozen foods that are both nutritious and fresh has made Vista

    Processed Foods Pvt. Ltd. a name to reckon within the industry.

    Dynamix DairySupplier of

    Cheese:

    Towards fulfilling its commitment to

    sourcing almost all of its products fromlocal suppliers, McDonalds has identified

    local Indian business, which shares its level

    of commitment and dedication in satisfying

    customers by supplying them the highest

    quality products.

    The relationship between McDonalds and its Indian suppliers benefits both the

    parties. For McDonalds world-class products of the highest quality are readily

    available from local sources. For the suppliers it is an opportunity to expand their

    business, have access to the latest technology and exposure to advanced practices; in

    addition to the ability to grow as McDonalds expands in India. Through McDonalds,

    the suppliers also get access to overseas markets to export their products.

    One of the best examples of this supplier relationship is evident in the case of the

    multi crore Dynamix Group, McDonalds supplier of cheese in India. Dynamix has

    brought immense benefits to farmers in Baramati, Maharashtra by setting up a new

    network of milk collection centres equipped with bulk coolers. Easy accessibility has

    enabled farmers augment their income by finding a new market for surplus milk. The

    factory has:

    Fully automatic international standard processing facility.

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    Capability to convert milk into cheese, butter/ghee, skimmed milk powder,

    lactose, casein & whey protein and humanized baby food.

    Strigent quality control measures and continuous research & development.

    Cheese, milk and other milk products are also transported in refrigerated tracks

    as well as stored in cold storage even in the franchises.

    From farm two degrees Celsius in 90 minutes is the first step to quality. For

    example, the Rs 262-crore Dynamix Dairy Industries, located in Baramati in Pune

    district of Maharashtra, manufactures cheese slices for McDonalds at 10 metric tonnes

    per month. Dynamix has helped set up 15 bulk cooling centres throughout the district

    from which it purchases milk. Each cooling centre, which is equipped with modern

    measuring and testing equipment and a large cooling tank, is not more than a few

    kilometres away from local dairy farms. A farmer can deliver milk even twice a day on

    his bicycle and get a printed receipt on the spot, which also lists the quality of the milk

    supplied by him as per fat content, colour and solids content. If the milk is sub-standard

    or adulterated, it is rejected on the spot. A batch of milk can vary from one litre to 10

    litres, or more. Each batch is mixed in one large stainless steel cooler and chilled

    immediately to two degrees Celsius to stop bacterial growth and preserve freshness.

    From this point onwards, until just before the burger is actually served in a McDonalds

    restaurant hundreds of kilometres away, the temperature is never allowed to increase.

    When the refrigerated milk arrives at the Dynamix plant at Baramati, the milk in every

    single tanker is thoroughly tested and rejected if found sub-standard, adulterated or

    contaminated. The sophisticated testing lab can check fat content with an accuracy of

    0.1 per cent. It can even detect minute traces of pesticides or antibiotics administered to

    cows. This instant feedback and the rejection of the entire tanker-load forces farmers to

    follow the best practices in terms of animal husbandry, use proper feeds, cut down on

    the indiscriminate use of pesticides and animal medicines and completely stop even the

    slightest attempts at adulteration.

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    Amrit FoodSupplier of long life UHT Milk and Milk Products

    for Frozen Desserts:

    AmritFood, an ISO 9000 company,

    manufactures widely popular brands - Gagan

    Milk and Nandan Ghee at its factory at

    Ghaziabad, Uttar Pradesh. Its plant has:

    State-of-the-art fully automatic machinery

    requiring no human contact with product, for

    total hygiene.

    Installed capacity of 600 litres/hour for

    producing homogenized UHT (Ultra High

    Temperature) processed milk and milk products.

    Strict quality control supported by a fully equipped quality control laboratory.

    All suppliers adhere to Indian government regulations on food, health and hygiene

    while continuously maintaining McDonald's recognized standards. As the ingredients

    move from farms to processing plants to the restaurant, McDonald's Quality Inspection

    Programme (QIP) carries out quality checks at over 20 different points in the Cold

    Chain system. Setting up of the Cold Chain has also enabled it to cut down on

    operational wastage Hazard Analysis Critical Control Point (HACCP) is a systematic

    approach to food safety that emphasizes prevention within its suppliers' facility and

    restaurants rather than detection through inspection of illness or presence of

    microbiological data. Based on HACCP guidelines, control points and critical control

    points for all McDonald's major food processing plants and restaurants in India have

    been identified. The limits have been established for those followed by monitoring,

    recording and correcting any deviations. The HACCP verification is done at least twice

    in a year and certified.

    The relationship between McDonald's and its Indian suppliers is mutually beneficial.

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    As McDonald's expands in India, the supplier gets the opportunity to expand his

    business, have access to the latest in food technology, exposure to advanced agricultural

    practices and the ability to grow or to export. There are many cases of local suppliers

    operating out of small towns who have benefited from their association with

    McDonald's India.

    Radhakrishna FoodlandDistribution Centre:

    An integral part of Radhakrishna Group, Foodland

    specializes in handling large volumes, providing the

    entire range of services including procurement,

    quality, inspection, storage, inventory management,

    deliveries, data collection, recording and reporting.

    Salient strengths are:

    A one-stop shop for all distribution

    management services.

    Dry and cold storage facilities to store and transport perishable products at

    temperatures up to -22 Degrees Celsius.

    Effective process control for minimum distribution cost.

    Capacity to handle large volumes.

    Maintain open communication lines with customers, suppliers and all other

    business associates.

    Invested ERP software to bring in efficiency, speed and accuracy into the

    system.

    McDonald's local supply networks through Radhakrishna Foodland, which operates

    distribution centres (DCs) for McDonald's restaurants in Mumbai and Delhi. The DCs

    have focused all their resources to meet McDonald's expectation of 'Cold, Clean, and

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    that take pride in satisfying customers by presenting them with the highest quality

    products. Adherence to Indian Government regulations on food, health and hygiene

    were a top priority.

    McDonald's India today purchases more than 96% of its products and supplies

    from Indian suppliers. Even our restaurants are constructed using local architects,

    contractors, labour and maximum local content in materials.

    The relationship between McDonald's and its Indian suppliers is mutually

    beneficial. As McDonald's expands in India, the supplier gets the opportunity to expand

    his business, have access to the latest in food technology, get exposure to advanced

    agricultural practices and the ability to grow or to export. There are many cases of local

    suppliers operating out of small towns who have benefited from their association with

    McDonald's India.

    All suppliers adhere to Indian government regulations on food, health and

    hygiene while continuously maintaining McDonald's recognised standards. As the

    ingredients move from farms to processing plants to the restaurant, McDonald's Quality

    Inspection Programme (QIP) carries out quality checks at over 20 different points in the

    Cold Chain system. Setting up of the Cold Chain has also enabled us to cut down on

    operational wastage

    Hazard Analysis Critical Control Point (HACCP) is a systematic approach to

    food safety that emphasizes prevention of illness or presence of microbiological data

    within our suppliers' facilities and our restaurants rather than its detection through

    inspection. Based on HACCP guidelines, control points and critical control points for

    all McDonald's major food processing plants and restaurants in India have been

    identified. The HACCP verification is done at least twice in a year and certified.

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    Ch. 9. Directors Statement :

    Vikram Bakshi (Managing Director India) says:

    For all those opposed to the import of foreign culture as represented by

    McDonalds, here is food for thought. The fast food chain that serves five crores

    customers per day across the globe and is planning its largest growth this year in India

    (40 outlets in 2009) after touching the figure of 131 in 12 years in the country, the

    beauty of its burger is that it represents national integration on a platter.

    Each McDonalds burger requires nine different ingredients which, its India

    Managing Director Vikram Bakshi points out, are sourced from 35 suppliers across the

    country. The sesame seeds come from Ghaziabad in UP, the buns are sourced from

    Noida and Khapoli in Maharashtra, the vegetable sauce comes from Phillaur in Punjab,

    the cheddar cheese from Baramati in Maharashtra, and the butter and bread from

    Ludhiana in Punjab. As for its trademark iceberg lettuce, it comes from farmers in

    Ooty, Pune and Dehradun.

    This is not all, says Bakshi, as he unfolds the companys plans to have a massive

    cold chain infrastructure in place to deliver farm fresh vegetables. This will achieve the

    bigger goal of capping losses of farmers, he points out. The amount of fruit wasted in

    India because of lack of post-harvest infrastructure results in losses which equal the

    fruit consumption of entire Europe, he adds.

    The huge costs of over Rs 30,000 required to set up such an infrastructure in

    India have even prompted companies in the food retail business to approach the Prime

    Minister. Already 90 per cent of our raw material is sourced from India. Our efforts at

    growing potatoes in Gujarat after developing the varieties in Solang Valley in Himachal

    will see us even meeting the need for our iconic golden French fries from India, says

    Bakshi.

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    Ch. 10. McDonaldss Indias Cold Chain:

    A unique sense of dedication and commitment characterizes McDonalds India

    a commitment to be driven by the leadership of local owners. Commitment to provide

    quality products and fast friendly services at a real value to support other Indian

    business through local sourcing and imparting new skills and to generate local

    employment by being a part of the local culture. This commitment has translated into

    enduring benefits to the businesses at the grass root level, in the areas of introduction

    into new crops, new agricultural practices and food processing methods and procedures.

    McDonalds unique cold chain, on which the QSR major has spent more than

    six years setting up in India, has brought about a veritable revolution, immensely

    benefiting the farmers at one end and enabling customers at retail counters get the

    highest quality food products, absolutely fresh and at great value.

    Explaining the concept, Mr. Amit Jatia, Joint Venture Partner and Managing

    Director, McDonalds Western India, said, Every year, Rs.50,000 crore worth of

    food produce is wasted in India because of lack of proper infrastructure for storage andtransportation under controlled conditions. These range from physical damage and

    vermin infestation to improper temperature, humidity and air-flow.

    McDonalds, through its unique cold chain, has been able to both cut down on

    its operational wastage, as well as maintain the freshness and nutritional value of raw

    and processed food products. This has involved procurement, warehousing,

    transportation and retailing of perishable food products all under controlled

    temperatures.

    Setting up this extensive cold chain distribution system has involved the transfer

    of state-of-the-art foodprocessing technology by McDonalds and its and its

    international suppliers to pioneering India enterprises who, today, are an integral part of

    McDonalds cold chain.

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    From Field To 2 degree C In 90 Minutes

    Trikaya Agriculture, a major supplier of iceberg lettuce to McDonalds India, is

    one such enterprise that is an intrinsic part of the cold chain. Exposure to better

    agricultural management practices and sharing of advanced agricultural technology by

    McDonalds has made TrikayaAgriculture extremely conscious of delivering its

    products with utmost care and quality.

    Initially lettuce could only be grown during the winter months but with

    McDonalds expertise in the area of agriculture, Trikaya Farms in Talegaon,

    Maharashtra, is now able to grow this crop all the year round.

    McDonalds has provided assistance in the selection of high quality seeds,

    exposed the farms to advance drip-irrigation technology, and helped develop a

    refrigerated transportation system allowing a small agri-business in Maharashtra to

    provide fresh, high quality lettuce to McDonalds urban restaurant locations thousands

    of kilometres away.

    Post harvest facilities at Trikaya include a cold chain consisting of a pre-cooling

    room to remove field heat, a large cold room and a refrigerated van for transportation

    where the temperature and the relative humidity of the crop is maintained between 1

    degree C and 4 degree C and 95% respectively. Vegetables are moved into the pre-

    cooling room within half an hour of harvesting. The pre-cooling room ensures rapid

    vacuum cooling to 2 degree C within 90 minutes. The pack house, pre-cooling and cold

    room are located at the farms itself, ensuring no delay between harvesting, pre-cooling,

    packaging and cold storage.

    With this cold chain infrastructure in place, Trikaya agriculture has also a plan to

    export this high value product to other international markets, especially to McDonalds

    Middle East and Asia Pacific operations. McDonalds expertise in packaging, handling

    and long distance transportation has helped Trikaya to do trial shipments to the Gulf

    successfully.

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    In addition to export, McDonalds assistance has enabled Trikaya Agriculture to

    supply this crop to a number of star-rated hotels, clubs, flight kitchens and offshore

    catering companies all over India.

    Vista Processed Food Pvt. Ltd., McDonalds suppliers for the chicken and

    vegetable range of products, is another important player in this cold chain. Technical

    and financial support extended by OSI Industries Inc., USA and McDonalds India

    Private Limited have enabled Vista to set up world class infrastructure and support

    services.

    This includes hi-tech refrigeration plants for manufacture of frozen food at

    temperature as slow as35 degree C. This is vital to ensure that the frozen food retains

    it freshness for a long time and the cold chain is maintained. The frozen product is

    immediately moved to cold storage rooms.

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    Ch. 11. Inventory :

    Inventory cost:

    Inventory as a percent of overall business continues to decline. As product line

    proliferate, inventory carrying costs become significant. Retail and Wholesale firms

    place pressure on supply chain members to significantly reduce inventories. Physical

    inventories are needed on the inbound and outbound sides of a business.

    Types of inventory include cycle stocks, in process or in transit stock, safety

    stock, seasonal stock, speculative stock and dead stock. Types of inventory costs

    include carrying cost, order/recorder cost. Inventory carrying cost is comprised of

    capital cost, storage space cost, inventory service cost, inventory risk cost.

    Capital costs are expressed as percentage of product value and are based on

    value of average inventory. The rate is most appropriate.

    Inventory turnover:

    A ratio showing how many times a companys inventory is sold and replaced

    over a period.

    Generally calculated as: Sales/Inventory

    However, it may also be calculated as: Cost of Goods sold/Average Inventory

    Although the first calculation is most frequently used. COGS (cost of goods

    sold) may be substituted because sales are recorded at market value, while inventories

    are usually recorded at cost.

    This ratio should be compared against industry averages. A low turnover implies

    poor sales and, therefore, excess inventory. A high ratio implies either strong sales or

    effective buying.

    High inventory levels are unhealthy because they represent an investment with a

    rate of return of zero. It also opens the company up to trouble should prices begin to

    fall.

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    Inventory of McDonalds:

    Inventory is the total amount of goods and/or materials contained in a store or

    factory at any given time. Store owners need to know the precise number of items on

    their shelves and storage areas in order to place orders or control losses. Factory

    managers need to know how many units of their products are available for customer

    orders. Restaurants need to order more food based on their current supplies and menu

    needs. All of this business relies on an inventory count to provide answers.

    The word inventory can refer to both the total amount of goods and the act of

    counting them. Many companies take an inventory of their supplies on a regular basis in

    order to avoid running out of popular items. Others take an inventory to insure the

    number of items ordered matches the actual number of items counted physically.

    Shortages or overages after an inventory can indicate a problem with theft (called

    shrinkage in retail circles) or inaccurate accounting practices.

    Ordering costis any expenditure which is incurred for placement of order.

    Some farms deliberately hold inventory in order to reduce the ordering cost. It also

    includes the other various related activity involved in the ordering process. It includes

    cost for receiving source, purchases, and order inspection, set up and binding cost.

    Carrying costinvolved in holding and maintaining goods or raw material before

    Ordering

    cost

    Carryingcost

    InventoryCost

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    to take care on unexpected events. It is often called buffer stock. The absence of

    Inventory is called a shortage.

    In McDonalds they do keep safety stock but to a small quantity as the material

    is soon to get spoilt. They use the safety stock first when the new order is received and

    then the new one.

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    Ch. 12. Execution of a New Product :

    Any new product at McDonalds passes through many stages before it is finally

    launched in its retail avtar. We do not randomly pick up the products from the

    McDonalds international offerings but focus on our research and development for

    products, said Mr. Amit Jatia, managing director, Hard Castle Restaurants, a

    franchisee of McDonalds India.

    Based on its menu vision, McDonalds makes a prototype and rotates it for

    feedback within its own set up. After making suitable changes, the product is tested

    with focused groups. Subsequently, alternations are made if necessary, supply lines

    established and then the product is finally launched in the restaurant.

    In fact, McDonalds India is the first chain in the world to develop a coffee

    machine with Coke for its Georgia coffee. The launch of McCurry Pan - a baked dish inAhmedabad. McDonalds India is seriously exploring petrol pumps to expand its

    network. Gas stations would be one of the major drivers of the retail expansion of the

    company in future.Gas stations would come up in a big way as the result of the golden

    quadrilateral project and McDonalds could set up its outlets there. They have worked

    with BPCL and HPCL and are in talks with IOC for the same.

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    Fresh forever

    Best Quality Commitment

    Reasonable Prices

    Strength

    Unstable demand

    Highly responsive chain

    Domestic market saturation

    Inflexibility

    Increase in Prices of Raw material

    Weakness

    To Farmers to cultivate new crops and getting trained to meetthe required standards.

    Opportunity

    Loss due to natural calamities

    Loss due to spoilage

    Low amount of sales than expected

    Threats

    Ch. 13. SWOT Analysis of Materials

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    Ch. 14. Findings of the study

    1. Every organisation, no matter how big or small in size,has its own forecasting

    techniques.This is because without forecasting the demand and supply requirements,

    the orders cant be fulfilled. Similarly, for order processing, Mc Donalds forecast its

    requirements on a daily basis.

    The study that we did in Indore, where there are three outlets of Mc Donalds,

    each one in a multiplex, revealed that their forecasting depends on a few factors like the

    upcoming movie release in that week and its response.

    Likewise, we conducted this study in the month of March and the demand during

    this time is affected by the school and college examinations.The demand for different

    departments also vary from one outlet to another.

    2. Mc Donalds has its outlets in different parts of the globe.

    In India too, Mc Donalds has numerous outletsin different cities, but they do not

    have any local vendor.

    They have a fixed vendor, that is The Radhakrishna Foodland, which caters the

    range of 230 products that Mc Donalds require.

    The Radhakrishna Foodland not only process the fooditems but also handle the

    logistics partially.The delivery center is at Mumbaiwhere from the required stock is

    transported to different locations.

    The concerned person told us, that due to the ephimeral shelf-life of tomatoes, it

    i sthe only commodity that they make purchase from local markets; specifically of four

    to five inches diameter which undergoes a thorough sanitization process, only after

    which it is used.

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    3. Every organisation has its inventory cycle.The Mc Donalds outlets do keep a safety

    inventory.

    They keep the buffer stock for a period of three days,and their stock is stored at

    the outlets itself. Every product used in preparing the menu items come with an expiry

    date, like the French-fries served in Mc Donalds has a life of two hundred and seventy

    days. But once the menu items are cooked,they are not kept for more thanten minutes,

    after which they are dumped as waste.

    There are daily product safety checklist which is maintained manually as well as

    with the help of computer softwares too,helping the staff in assessing the stock quantity

    at the end of each day.

    4. Radhakrishna Foodland had been working with Mc Donalds for the past ten yearsand

    the trems abd conditions for choosing the network design was decided by the

    headquarters of Mc Donalds itself.The food items are transported via air conditioned

    trucks having different chambers.Each chamber is designed for the different kind of

    stock at different temperature levels,as per the suitability and requirements of the

    stock.All the raw material comes in a frozen form.The trucks have pre-defined

    destinations to reach each day.The sources at Mc Donalds told u sthat the trucks from

    Mumbai reach Indore on Monday,Pune on tuesday, Hyderabad on wednesday and so on

    at Bangalore and Gujarat too.

    The items which are to be procured from foreign territories comes to India via

    ships, like the french fries are obtained from new Zealand via shipments.

    5. They do assess their daily requirements via safety checklists.The rounding and

    scheduling of ouput and input is done manually and through computer based softwares

    too.

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    6. Mc Donalds does not have any third party logistics.

    7. With the evolvement of the new technologies and convenient softwares, the

    conventional methods of maintaining suplly chain records are now a passe`.

    Mc Donalds too use a standardized visual Foxpro based program via which the

    outlets are linked with the head office and the Radhakrishna Foodland too.

    8. Mc Donalds believe in the saying "Customer is the King" and thus the the complaints

    , if any, from the customers end are duly heard and resolved as per the need of the

    situation.

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    Ch. 15. Conclusion

    As the research and study has show the important functions and roles of a

    Material Department in any organisation, proper measure should be taken to manage

    the material department as it is the highest contributor of cost. Therefore companies

    should take systematic efforts to handle this department and hence preplanning is must

    and market research and development helps to reach to that perfection.

    When it comes to food industry, customers want the food to be tasty, fresh and

    of good quality and hence handling, processing and managing the material come into

    picture. Once these parameters are met at the right time at the right place, the

    customer is satisfied.

    This can be concluded by stating that each and every department in an

    organisation plays a crucial role and by managing the key part of Material in the

    organisation reduces the cost factor.

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    Ch. 16. References

    Bibliography:

    Newspaper:- The Economic Times

    Times of India

    Books:- Principles of Management (Philip Kotler)

    Research Methodology (C.R.Kothari)

    Webliography:

    www.quickix.com

    www.information.com

    www.wikipedia.com

    http://www.quickix.com/http://www.quickix.com/http://www.information.com/http://www.information.com/http://www.wikipedia.com/http://www.wikipedia.com/http://www.wikipedia.com/http://www.information.com/http://www.quickix.com/