McDonalds plan to increase sales in a global market.

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Paper 2 Section C Question and Answer

1.6 With reference to one or two organization(s) that you have studied discuss how globalization and innovation may impact growth and evolution.

McDonalds is often held as being a successful example of a business who has benefitted from globalization as it has over 33,000 restaurants worldwide, though only 14,000 in the United States. McDonalds has introduced new products in countries like India where they have adapted their menu to suit local tastes by selling vegetarian burgers. However, since 2013 McDonalds has seen it’s sales and profits fall and so needs to turn around this problem quickly. In 2015 it introduced a strategy to do so.

Globalisation is the process whereby trade is now being conducted over widening geographical boundaries, McDonalds is in most big cities worldwide. Big businesses pushed for free trade agreements which makes it easier for them to enter new markets. However this encourages competition. Innovation is the process of introducing new ideas that may affect products or the way in which they are made.

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McDonalds has seen it’s sales fall for many reasons: in China, there were quality issues as suppliers sold them bad meat. This is a problem for globalized businesses, an increasing supply chain but how to guarantee quality? In Japan an aging population means less consumers in their target age group. In North America consumers have become more health conscious and are eating more at competitors like upmarket burger restaurants Burger Shack. McDonalds has begun closing loss making restaurants in Japan and United States. However, in the UK McDonalds has improved sales through innovation aiming more products at local consumers ...

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