External factors affecting the fast food industry essay

external factors affecting food industry

This would increase the volume of the industry. Globally, fast food brands ought to ensure that they have complied with the packaging regulations and hygiene and food quality specifications so as to protect public health. The franchising system allows retailers to franchise names and get continuous supplies of finished products.

The industry plays an invaluable role of employing over 4 billion and counting thus assisting in reducing the unemployment rate in the country. Even though McDonald is still a bit reluctant to franchise the business in China, there is a big opportunity to expand the business easily and in a fast phase if they do the franchising.

It is performed by firms in bringing about an exchange process with the intent to satisfy human needs and wants.

Environmental factors affecting restaurant business

It will cover the main structural features of the industry that influence competition and profitability. Competitors McDonalds has to compete with both western and Asian competitors who has entered China before McDonalds and also with entrants in the recent times. They are linked not only because external violence causes internal violence, but also because of the reverse The economic system was a closed one. Threat to substitute products: 7 2. Any organization is located and operated in the environment. In a typical franchise agreement, the franchisor known as the parent company grants the franchisee a license to operate a standardized restaurant with a specified technology and widely recognized trademark; in exchange, the franchisee pays the parent company a fixed fee and a monthly royalty on gross sales Krueger says this is generally 8 percent. This will lead to new competitors in the market place offering a different product type and increase the amount of competition amongst the already competing firms. This has not only earned it a good reputation among the loyal consumers who return for more of the great quality food and taste but has also strengthened its market position. Changes in legal systems and new laws shape the remote or macro-environment of businesses by imposing new requirements. This does not pose a problem as businesses will not be phased by this to invest more and grow. Place; Distribution Channel is a medium by which goods and service are made available to the consumers for the use or consumption.

This is a major threat for the growth of McDonalds. On the other hand, changes in climate conditions in some regions threaten the company. This recommendation also addresses the threat linked to the healthy lifestyle trend, and the threat associated with health regulations in workplaces and schools.

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