A SWOT Matrix for McDonald
Strengths Weaknesses
1. Largest fast food market share 1. Negative Publicity
2. Partnerships with best brands 2. Low differentiation
3. Locally adapted food menus 3. Unhealthy food menu
4. High Brand recognition
5. Children targeting
Opportunities SO Strategies WO Strategies
1. Increasing demand for healthier food 1. Open new chains (S1, O4) 1. Produce healthy foods
2. Changing customer habits 2. Target new market (W3, O1)
3. Home meal delivery segments (S5, O4) 2. Increase advertising
4. New customer groups (W1, O2)
Threats ST Strategies WT Strategies
1. Trends towards healthy eating 1. Partnering with other 1. Increase differentiation
2. Lawsuits against McDonald international Food chains (S2, T3) (W2, T4)
3. Currency fluctuations 2. Opening new chains in 2. Hiring more qualified
4. Saturated fast food markets unsaturated markets (S4, T4) legal advisors (W3, T3)
Conclusions from the McDonald’s SWOT Matrix
Furthermore, with regards to strengths and threats, MacDonald can partner with other international food chains. This strategy will enable it to utilize its strength of partnering with best brands to overcome the threat of currency fluctuations across different countries. Moreover, it can also consider opening new chains in unsaturated markets, for instance, in the underdeveloped countries. This strategy will enable it to use its strength of high brand recognition to overcome its external threat of fast food markets being saturated. Nevertheless, concerning weaknesses and threats, MacDonald can increase differentiation. This strategy will help the company overcome its weakness of low differentiation while it also tackles the threat of saturated fast food markets. Also, it can consider hiring more qualified legal advisors. This strategy will enable it overcome its weakness of unhealthy food menus and also address its external threat of lawsuits against it (Sawant, 2015).
The Assurance of Learning Exercise 6B: Developing a SPACE Matrix for McDonald’s
A Space Matrix for MacDonald
Financial Position (FP) Ratings
The Company’s sales increased by 4.0% 2.0
Consolidated operating income decrease of 2% 3.0
Consolidated revenues decrease of 5% 10.0
Industry Position (IP)
Trends towards healthy eating 2.0
Currency Fluctuations 3.0
Lawsuits against companies 12.0
Stability Position (SP)
Less developed countries are experiencing high currency fluctuations -5.0
This industry is saturated -4.0
Industry lawsuits have created instability throughout the industry -12.0
Competitive Position (CP)
The company has the largest market share -5.0
The company has high brand recognition -2.0
The Company successfully targets children -10.0
Conclusion
SP Average is -12.0/3= -4.00 IP Average is +12/3= 4.00
CP Average is -10/3= -3.33 FP Average is +10/3=3.33
Directional Vector Coordinates: x-axis: -3.33+ (+4.0) = +0.67
: y-axis: -4.00+ (+3.33) = -0.67
MacDonald should pursue competitive Strategies
References
David, F. (2013). Strategic management concepts and cases. Harlow: Pearson.
Sawant, S. (2015). SWOT Analysis of MacDonald's. Journal of Management, 3(11), 38-40.
