Fast Food Business

Fast Food Business

Beef are not allowed in India for the Hindus. Indonesian prefer to eat more rice and rice-based foods.America is the heartland for McDonald’s with 50% of global sales. Europe has one-third of global sales and is catching up fast, with 39% of global earnings. McDonald’s has a presence in 40 European countries through 65% of European earnings come from the Big Three France, Germany, and Britain. France is first in profits, with Germany second and Britain third. Russia is the market with the strongest growth with only about 200 McDonald’s outlets. It is the group’s most profitable market worldwide in operating income per restaurant.Global consumption for burgers and fries made sales at McDonald’s soar high in 2007. The company had 2007 sales up 9% year-on-year to $22.8bn($20.5 billion in 2005). Revenue in 2005, $5bn, and net profit$2.26bn in 2005. Operating income fell 12% to $3.9b.Europe in 2007 over 2006 result, with sales up 7.5% year-on-year, contributed operating income of $2.13bn. There was disappointment over the fall of the sale and operating income of the company resulting in a drop in the share price of McDonald’s.McDonald’s has three major problems in Europe from where it gets its one-third of its revenue. The beef crisis, which was supposed to create brain damage and foot and mouth disease, haunted the company’s food business badly. This caused the reduction in consumption of McDonald’s food by 60% in Germany and also in other European countries. This problem is now subsiding. This is a big problem because it concerns the health of human beings, which is a very sensitive matter.Weakening euro that hampered the sale of US products in terms of the dollar causes the second problem. Weak euro reduced the dollar value of company sales in Europe. This is an economic problem a multinational company with thousands of outlets abroad will often face this problem becausecross-currency fluctuations.

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