DISSERTATION REPORT

ON

Consumer Perception on Fast food Industry with Special Emphasis to McDonald’s.

CERTIFICATE

This is to certify that has carried out this Dissertation Project titled – “Consumer

Perception On Fast food Industry with special emphasis to McDonald’s” , under

the able guidance and supervision of

This Dissertation report has the requisite standard for the partial fulfillment the

Post Graduate Degree in Management. To the best of our knowledge no part of this

report has been reproduced from any other report and the contents are based on

original research.

(Faculty Guide) (Student)

ACKNOWLEDGEMENT

Every endeavor in itself is an impression of the efforts of not only those who

pursue it but of those as well who provide guidance and motivation towards its

successful completion. Likewise, this project bears an imprint of all those who

helped me at various stages and it would be unfair on my part not to thank them.

The successful completion of this project could not have been possible without the

co-operation and encouragement of , my project guide, who provided me with her

unending support from the very beginning of the project, which helped in timely

completion of the project.

I would also like to thank all the my Marketing faculty members at AGBS & for

enlightening my way whenever any kind of support was required in completion of

the project.

.

TABLE OF CONTENTS

Chapter no. Subject Page no

Ch #1.0 Executive summary

Ch #2.0 Industry Profile

Ch#3.0 Company profile

Ch #4.0 Critical Review of literature.

Ch #5.0 Research Methodology

Ch #6.0 Findings & Analysis

Ch #7.0 Recommendation

Ch #8.0 Bibliography

Annexure

CHAPTER 1 EXECUTIVE SUMMARY

The topic of the study was “Consumer Perception on Fast food Industry with

special emphasis to McDonald’s”.

The study has given a way to in depth understanding of the fast food industry in

India and how western fast food brands have established themselves going glocal.

Indian consumers are very sensitive to cultural issues but the western fast food

industry has very tactfully made way in Indian hearts. Research has shown that fast

food industries major competitors are house wives as most of the Indians prefer

eating at home to outside food. Many consider fast food to be junk food and

unhealthy.

Thus major challenge for the industry is to build on consumer perception that they

provide nutritious food rather than junk food. In East Asian countries it has been

seen that 64% of the population eat outside regularly in fast food chains where as

in India it is only 31%.

McDonald’s aims at increasing the consumption of fast food of Indians eating

outside from 6.8 times to 12 times in a month.

The objectives of the study were to understand the factors that influence

consumer decision-making process w.r.t fast food restaurant industry in India, the

strategies adopted by the various players in fast food industry, how well are the fast

food brands perceived as and the challenges cum growth opportunities for western

brands in India.

The scope of the study covered improving on brand image and growth

opportunities for western fast food brands. The sampling unit consisted of Indians

eating outside from North and East India.

The major findings of this project can be briefed in a few lines as fast food ollows

At last it can be concluded that .

Chapter 2: INDUSTRY PROFILE

Introduction

Fast food is the term given to food that can be prepared and served very quickly.

While any meal with low preparation time can be considered to be fast food,

typically the term refers to food sold in a restaurant or store with low quality

preparation and served to the customer in a packaged form for take-out/take-away.

Outlets may be stands or kiosks, which may provide no shelter or seating, or fast

food restaurants (also known as quick service restaurants).

Franchise operations which are part of restaurant chains have standardized

foodstuffs shipped to each restaurant from central locations. The capital

requirements involved in opening up a fast food restaurant are relatively low.

Restaurants with much higher sit-in ratios, where customers tend to sit and have

their orders brought to them in a seemingly more upscale atmosphere may be

known in some areas as fast casual restaurants.

History

The concept of ready-cooked food for sale is closely connected with urban

development. In Ancient Rome cities had street stands that sold bread and wine. A

fixture of East Asian cities is the noodle shop. Flatbread and falafel are today

ubiquitous in the Middle East. Popular Indian fast food dishes include vada pav,

panipuri and dahi vada. In the French-speaking nations of West Africa, roadside

stands in and around the larger cities continue to sell—as they have done for

generations—a range of ready-to-eat, chat, grilled meat sticks known locally as

brochettes.

The Start of Fast Food Culture

The concept of fast food pops up during 1920s.The 1950s first witnessed their

rapid proliferation. Several factors that contributed to this explosive growth in

50’s were:

(1) America’s love affair with the automobiles.

(2) The construction of a major new highway system.

(3) The development of sub-urban communities.

(4) The baby boom subsequent to world war second.

“Fast-food chains initially catered to automobile owners in suburbia.

On the go

Fast food outlets are take-away or take-out providers, often with a "drive-thru"

Service which allows customers to order and pick up food from their cars; but most

also have a seating area in which customers can eat the food on the premises.

People eat there more than five times a week and often, one or more of those five

times is at a fast food restaurant. Nearly from its inception, fast food has been

designed to be eaten "on the go", often does not require traditional cutlery, and is

eaten as a finger food. Common menu items at fast food outlets include fish and

chips, sandwiches, pitas, hamburgers, fried chicken, French fries, chicken nuggets,

tacos, pizza, hot dogs, and ice cream, although many fast food restaurants offer

"slower" foods like chili, mashed potatoes, and salads.

Variants

Although fast food often brings to mind traditional American fast food such as

hamburgers and fries, there are many other forms of fast food that enjoy

widespread popularity in the West. Chinese takeaways/takeout restaurants are

particularly popular. They normally offer a wide variety of Asian food which has

normally been fried. Most options are some form of noodles, rice, or meat.

Sushi has seen rapidly rising popularity in recent times. A form of fast food

created in Japan. Sushi is normally cold sticky rice served with raw fish. Pizza is a

common fast food category in the United States, with chains such as Domino's

Pizza, Sbarro and Pizza Hut. Menus are more limited and standardized than in

traditional pizzerias, and pizza delivery, often with a time commitment, is offered.

Fish and chip shops are a form of fast food popular in the United Kingdom,

Australia and New Zealand. Fish is battered and then deep fried. The Dutch

have their own types of fast food. A Dutch fast food meal often consists of a

portion of French fries.

Business

In the United States alone, consumers spent about US$110 billion on fast food in

2009 (which increased from US$6 billion in 1970). The National Restaurant

Association forecasted that fast food restaurants in the U.S. would reach US$142

billion in sales in 2009, a 5% increase over 2008. In comparison, the full-service

restaurant segment of the food industry is expected to generate $173 billion in

sales.

Globalization

In 2006, the global fast food market grew by 4.8% and reached a value of 102.4

billion and a volume of 80.3 billion transactions. In India alone the fast food

industry is growing by 40% a year. McDonald's is located in 120 countries and on

6 continents and operates over 31,000 restaurants worldwide. KFC is located in 25

countries. Subway has 29,186 restaurants located in 86 countries, Pizza Hut is

located in 26 countries, Taco Bell has 278 restaurants located in 12 countries

besides the United States.

Health issue

Tran’s fats which are commonly found in fast food have been shown in many tests

to have a negative health effect on the body. The fast food consumption has been

shown to increase calorie intake, promote weight gain, and elevate risk for

diabetes. The Centers for Disease Control and Prevention ranked obesity as the

number one health threat for Americans in 2008. It is the second leading cause of

preventable death in the United States and results in 400,000 deaths each year.

FAST FOOD INDUSTRY IN INDIA

INDIA – EMERGING MARKET FOR GLOBAL PLAYERS

The percentage share held by foodservice of total consumer expenditure on food

has increased from a very low base to stand at 6.6% in 2010. Eating at home

remains very much ingrained in Indian culture and changes in eating habits are

very slow moving with barriers to eating out entrenched in certain sectors of Indian

society.. The growth in nuclear families, particularly in urban India, exposure to

global media and Western cuisine and an increasing number of women joining the

workforce have had an impact on eating out trends.

FACTS AND FIGURES

Fast food is one of the world’s largest growing food type. India’s fast food industry

is growing by 40% a year and is expected to generate a billion dollars in sales by

2009.The multinational segment of Indian fast food industry is up to Rs. 6 billion,

a figure expected to zoom to Rs.70 billion by 2010. By 2005, the value of Indian

dairy products is expected to be Rs.1, 00,000 million. In last 6 years, foreign

investment in this sector stood at Rs. 3600 million which is about one-fourth of

total investment made in this sector. Because of the availability of raw material for

fast food, Global chains are flooding into the country.

MARKET SIZE & MAJOR PLAYERS

a) Dominated by McDonalds having as many as 220 outlets.

b) Domino’s pizza is present in around 100 locations.

c) Pizza hut is also catching up and it has planned to establish 180 outlets at the

end of 2010.

d) Subways have established around 80 outlets.

e) Nirula’s is established at Delhi and Noida only. However, it claims to

cater 60,000 guests every day.

Major players in fast food are:

· McDONALD’S

· KFC

· PIZZA HUT

· DOMINOS PIZZA.

· COFFEE DAY

· BARISTA.

The main reason behind the success of the multinational chains is their expertise in

product development, sourcing practices, quality standards, service levels and

standardized operating procedures in their restaurants, a strength that they have

developed over years of experience around the world. The home grown chains

have in the past few years of competition with the MNCs, learnt a few things but

there is still a lot of scope for improvement.

REASON FOR EMERGENCE

Gender Roles: gender roles are now changing. Females have started working

outside. So, they have no time for their home and cooking food. Fast food is an

easy way out because these can be prepared easily.

Customer Sophistication and Confidence: consumers are becoming more

sophisticated now. They do not want to prepare food and spend their time and

energy in house hold works. They are building their confidence more on ‘ready to

eat and easy to serve’ kind of foods

Paucity of Time: people have no time for cooking. Because of emergence of

working women and also number of other entertainment items. Most of the

time either people work or want to enjoy with their family.

Double Income Group: emergence of double income group leads to increase in

disposable income. Now people have more disposable income so they can spend

easily in fast food and other activities.

Working Women: working women have no time for cooking, and if they have

then also they don’t want to cook. Because they want to come out of the

traditionally defined gender roles. They do not want to confine themselves to

household work and upbringing of children

Large population: India being a second largest country in terms of population

possesses large potential market for all the products/services. This results into

entry of large number of fast food players in the country.

Relaxation in rules and regulations: with the economic liberalization of

1991, most of the tariff and non tariff barriers from the Indian boundaries are

either removed or minimized. This helped significantly the MNC’s to enter in

the country.

Menu diversification: increase in consumption of pizzas, burgers and other type

of fast foods.

CHALLENGES FOR THE INDUSTRY

Social and cultural implications of Indians switching to western breakfast

food: Generally, Hindus avoid all foods that are believed to inhibit physical and

spiritual development. Eating meat is not explicitly prohibited, but many Hindus

are vegetarian because they adhere to the concept of ahimsa. Those seeking

spiritual unity may avoid garlic and onions. The concept of purity influences Hindu

food practices. Products from cows (e.g., milk, yogurt, ghee-clarified butter) are

considered pure. Pure foods can improve the purity of impure foods when they are

prepared together. Some foods, such as beef or alcohol, are innately polluted and

can never be made pure. But now, Indians are switching to fast food that contain

all those things that are considered impure or against there beliefs. Some traditional

and fundamentalist are against this transformation of food habit and number of

times they provoke their counterparts to revolt against such foods. And that is what

happened when McDonald’s decided to enter the complexity of Indian business

landscape, counting only on its “fast food global formula”, without any apparent

previous cultural training.

Emphasis on the usage of bio-degradable products: Glasses,

silverware, plates and cloth napkins are never provided with fast food.

Instead, paper plates and napkins, polyurethane containers, plastic cups and

tableware, drinking cartons or PET (polyethylene terephthalate) bottles are

used, and these are all disposable. Many of these items are tossed in the

garbage instead of being recycled, or even worse, merely thrown on the

ground. This burdens nature unnecessarily and squanders raw materials. In

order to reduce soil and water pollution, government now emphasis more on

the usage of bio-degradable products.

.

PROBLEMS OF INDUSTRY

Environmental friendly products cost high: government is legislating laws in

order to keep check on the fast food industry and it is emphasizing more on the

usage of bio-degradable and environment friendly products. But associated with

this issue is the problem that fast food player faces - the cost associated with the

environment friendly product. They cost much higher than the normal products

that companies uses for packaging or wrapping their products.

Balance between societal expectation and companies economic objectives: To

balance a society’s expectation regarding environment with the economic burden

of protecting the environment. Thus, one can see that one side pushes for higher

standards and other side tries to beat the standard back, thereby making it a arm

wrestling and mind boggling exercise.

Health related issues: obesity:

I. Studies have shown that a typical fast food has very high density and food with

high density causes people to eat more then they usually need.

II. Low calories food: Emphasis is now more on low calorie food.

TRENDS IN INDIAN MARKET

Marketing to children's: fast food outlets in India target children’s as their major

customers. They introduce varieties of things that will attract the children’s

attention and by targeting children’s they automatically target their parents because

Children’s are always accompanied by their parents.

Low level customer commitment: Because of the large number of food

retail outlets and also because of the tendency of customer to switch from

one product to other, this industry faces low level customer commitment.

Value added technology services: There is continuous improvement in

the technology as far as fast food market in India is considered. The reason behind

that is food is a perishable item and in order to ensure that it remain fresh for a

longer period of time. Earlier, Indian people prefer eating at home but now with

the change in trend there is also need for improvement and up gradation of

technology in food sector.

Attracting different segments of the market: Fast food outlets are introducing

varieties of products in order to cater the demands of each and every segment of

the market. They are introducing all categories of product so that people of all age,

sex, class, income group etc can come and become a customer of their food line.

The success of fast foods arose from the changes in our living conditions:

1. Many women or both parents now work

2. There are increased numbers of single-parent households

3. Long distances to school and work are common

4. Usually, lunch times are short

5. There's often not enough time or opportunity to shop carefully for Groceries, or

to cook and eat with one's family. Especially on weekdays, fast food outside the

home is the only solution.

KFC Business Strategy

KFC fast-food chains are currently under the restaurant division of PepsiCo

Incorporated. Some major threats include the changing attitudes of society toward

healthier eating habits, KFC has more than 9,800 outlets located in 77 countries. In

marketing, KFC restaurants are not restricted from locating within close proximity

of other KFC restaurants. There are two alternative strategies for KFC. The first

strategy involves keeping PepsiCo beverage division and snack foods division

together, and a divestiture of PepsiCo restaurant division; selling Taco Bell, Pizza

Hut, and KFC.

DOMINO’S

SIZE OF THE MARKET

Domino's Pizza is one of the biggest and fastest growing international food joints

in South Asia. The very first Domino's Pizza outlet in India opened in Jan, 1996 at

New Delhi. Today, Domino's Pizza India has become a wide network of Pizza

delivery and food chain. There are close to 220 outlets in 42 cities of India and the

brand is the top most among the food delivery business. Domino’s Pizza outlets

can be seen at major locations of Delhi and NCR. Their home delivery is free with

a guarantee of “Thirty Minutes Nahi to Free”. Although they are expert in

delivering Pizzas on time, their eating joints and outlets are also good. We plan to

have a total of 500 stores in 75-80 cities by 2010 to 2011. It would entail an

investment of Rs 200 million during the period.

MARKET STRATEGIES

Promotional and Advertisement Campaigns(Coupons and discounts)

The '30 Minutes' Promise

Use of Technology(Digital interactive Television, Internet on the PC,

Mobile telephony)

Premium Pricing Strategy

Indian fast food industry and entry of multinational players

Distribution strategies of fast food chains in India

MC Donald’s

McDonald's is the leading global foodservice retailer with more than

31,000 local restaurants serving more than 58 million people in 118

countries each day. More than 75% of McDonald's restaurants worldwide

are owned and operated by independent local men and women.

The strong foundation that he built continues today with McDonald's

vision and the commitment of our talented executives to keep the shine

on McDonald's Arches for years to come. To read more about McDonald's

history, vision and executives, click on their links in the left menu. We drive our

business momentum by focusing on what matters most to customers. Our

owner/operators, suppliers and employees work together to meet customer needs in

uniquely McDonald's ways. The powerful combination of entrepreneurial spirit

and System wide alignment around our Plan to Win enables us to execute the best

ideas with both large-scale efficiency and local flair.

Advertising

McDonald's has for decades maintained an extensive advertising campaign. In

addition to the usual media (television, radio, and newspaper), the company makes

significant use of billboards and signage, sponsors sporting events ranging from

Little League to the Olympic Games, and makes coolers of orange drink with their

logo available for local events of all kinds. Nonetheless, television has always

played a central role in the company's advertising strategy.

To date, McDonald's has used 23 different slogans in United States Advertising, as

well as a few other slogans for select countries and regions. At times, it has run

into trouble with its campaigns.

BARISTA

Barista coffee was establishes in 1999 with the aim of identifying growth

opportunities in the coffee business. Increasing disposable incomes and global

trends in coffee indicate immense growth potential in one particular segment.

Barista Coffee is a chain of espresso bars in India. Headquartered in Delhi, Barista

currently has espresso bars across India, Sri Lanka and the Middle East. It was

founded in 1997 by Amit Judge and was part of his group of companies. He sold

part of the equity to first Tata Coffee. Then after he and Tata Coffee fell apart,

Sterling then bought over the firm. In 2007, Sterling divested all their stake to

Lavazza. Barista Coffee Company is currently owned by Lavazza, Italy’s largest

coffee company.

CAFÉ COFFEE DAY

Café Coffee Day is a chain of coffee shops in India having its headquarters in

Chikkamagaluru, Karnataka. A division of Amalgamated Bean Coffee Trading

Company Ltd. (ABCTCL), it is commonly known as Coffee Day or CCD. It

opened its first cafe in 1996 on Brigade Road in Bangalore, and today has the

largest cafe retail chain in India – with over 800 cafes in 112 cities. Large number

of coffee day cafes are located in Bangalore. The cafe chain has had much success

riding, and to some extent creating, the cafe culture wave that swept across

metropolitan India following strong economic growth resulting in an increase in

youth spending power. It has even tied up with World Space and Micro sense to

enable its cafes with satellite radio and Wi-Fi, respectively. Its first Wi-Fi cafe was

opened on Lavelle Road, Bangalore.

Chapter 3: COMPANY PROFILEChapter 3: COMPANY PROFILE

__________________________________________________________________________________________________________________________________

McDonald's opened its doors in India, the 95th country, in 1996 and was the first

country to serve non-beef and non-pork items. Its authority on non-beef and non-

pork products still remains unchallenged.

Ownership; McDonald’s India is a locally owned company managed by Indians

McDonald’s is a joint venture managed by

Vikram Bakshi, under Connaught Plaza Restaurants Pvt. Ltd in Northern and

Eastern Region (Headquartered in New Delhi)

Amit Jatia, under Hard castle Restaurants Pvt. Ltd. in the Western and Southern

Region (Headquartered in Mumbai)

McDonald’s Philosophy; McDonald’s philosophy of QSCV (Quality, Service,

Cleanliness and Value) is the guiding force behind it’s service to the customers

in India Vendor Development; McDonald’s spent more than 5 years (from

1990 onwards) on developing the first beef-less and pork-less menu in

McDonald’s history.

McDonald’s pioneered the establishment of Cold Chain across India which

helps maintain freshness and nutrition in every product

The Scorecard; The first McDonald's restaurant in India opened on October

13, 1996 at Basant Lok, New Delhi

Today, McDonald’s has 211 restaurants operating in India serving over 5,

00,000 customers’ everyday and has completed more than 10 years of

unparalleled in the country.

Every McDonald’s burger has nine different ingredients, which are sourced,

from 35 suppliers across the country before it reaches the consumerMcDonald’s

practices Vegetarian and Non-Vegetarian Segregation right from processing

to serving and uses 100 per cent vegetable cooking oilThe Happy Price Menu

competitively priced at Rs.20 was unveiled in April 2004

McDelivery™, McDonald’s Home Delivery Service was successfully

launched in April, 2004McAloo™ Tikki, Veg Surprise and Pizza McPuff™

developed in India are now being exported to the countries in the Middle East

McDonald’s introduced Coke’s Georgia Gold range of hot beverages which

was developed especially for the Indian market in 2002

As a leader in QSR segment (Quick Service Restaurant) McDonald’s has

pioneered various industry benchmark practices over the past decade of serving

Indian customers, including new concepts such as…

o Oil Alliances in India by inking with petroleum giants BPCL and HPCL.

The two such alliances with BPCL outlets are in Mathura (2000) (UP) and

Doraha (2002) (Punjab)

o Novel menu formats such as an Express Model with a limited menu and

Kiosks with a variety of dessert offerings

o Home Delivery (McDelivery™): Providing even more convenience to our

customers. In Oct 2006, McDelivery on bicycle at Chandni Chowk was

launched and in March ‘07 an all India single delivery number (66 000 666)

was introduced

o First Drive Thru Restaurant at NOIDA (UP) in 1997

o First Restaurant with operational Kitchen at Delhi Domestic Airport

Accolades

McDonald’s India has received many prestigious awards for its service and

performance including:

The ‘Most Respected Company’ for four consecutive years (2003-2006) in the

Food Services sector, by Business world

The ‘Most Preferred Fast Food Outlet’ 2006 & 2007 by Awaaz Consumer

Award hosted by CNBC

Star Retailer – the ‘Consumer Way, Food Services Retailer’ of the Year 2006

& 2007, 2008 by Franchise India

‘Retailer of the Year’ Award for catering services (2004-2006) at the Images

Retail Awards

The ‘Most Wanted Brand of the Year’ Award 2003 & 2004 by Franchising

Holdings India Ltd.

The ‘Most Admired F & B Retailer of the Year: QSRs Foreign Origin’ –

The Golden Spoon Awards by Images Retail

The Company with the Best Corporate Conscience – 2008 by Business &

Economy

‘Value for Money’ brand – 2010 by Pitch Magazine

The most trusted family restaurant brand in the country award in 2010 by

Reader’s Digest.

McDonald’s International

McDonald’s has over 32,000 local restaurants in more than 100 countries

70 percent of our restaurants worldwide are owned and operated by

independent, local businessmen and businesswomen

McDonald’s serves nearly 50 million customers each day

McDonald’s first franchised restaurant opened at Des Plaines, Illinois in 1955

by the founder Ray Kroc

McDonald’s has its own Hamburger University in Illinois, and the first batch

graduated in 1961

12 classes offered at Hamburger University are college accredited

In 1963, McDonald’s sold its one billionth hamburger

McDonald’s is listed on the New York, Frankfurt, Munich, Paris and Tokyo

stock exchanges

McDonald’s aired its first network TV advertisement “McDonald’s - Where

Quality Starts Fresh Everyday”, in 1965

The first McDonald’s Drive-Thru opened in Sierra Vista, Arizona in 1975

Happy Meals were added to McDonald’s menu in 1979

McDonald’s launched the new worldwide Balanced Active Lifestyles public

awareness campaign in 2005

McDonald’s celebrated its 50th Anniversary on April 15, 2005

McDonald’s Role in the Indian Economic Growth

In 1990, six years before the opening of the first McDonald's restaurant in India,

McDonald’s and its international supplier partners worked together with local

Indian companies to develop products that meet McDonald's vigorous quality

standards. These standards also strictly adhere to Indian Government regulations

on food, health and hygiene. Part of this development has involved the transfer of

state-of-the-art food processing technology, which has enabled Indian businesses

to grow by improving their ability to compete in today's international markets.

Prior to McDonald’s arrival in India, the concept of a Cold Chain for the

distribution of food and dairy products from the farm to the end supplier in

predetermined and stringently enforced climactic and hygienic conditions was at a

very nascent stage of development. For five years prior to opening the first

restaurant, McDonald’s pioneered the effort to develop this aforementioned Cold

Chain so that trademarked high standards would be assured. This concept has

today been adopted by various Indian and International players to deliver quality

produce to consumers.

For instance, Cremica Industries worked with another McDonald's supplier from

Europe to develop technology and expertise, which allowed Cremica to expand its

business from baking to also providing breading and batters to McDonald's India

and other companies. Another benefit is expertise in the areas of agriculture,

which allowed McDonald’s, and its suppliers to work with farmers in Ooty, Pune,

Dehradun and other regions to cultivate high quality Iceberg lettuce. This includes

sharing advanced agricultural technology and expertise like utilization of drip

irrigation systems, which reduce overall water consumption, better seeds &

agricultural management practices, which result in greater yields.

In some cases, these Indian suppliers had the technology - but no market for the

products they produced. For example, Dynamix Dairies - through its relationship

with McDonald's - was introduced to a large customer of milk casein and other

milk derivatives. McDonald's local supply networks through Radhakrishna

Foodland, to get products from the various suppliers to restaurants across India.

McDonald’s North India alone contributes Rs.30.7crore (USD 7.76

million)/annum approximately as sales tax to different State Governments where

we have our operations.

The McDonald’s Promise

QUALITY, SERVICE, CLEANLINESS & VALUE

When asked to explain McDonald's success, founder Ray Kroc used to say, "We

take the hamburger business more seriously than anyone else."

Kroc was a perfectionist. From the day he opened his first restaurant, he vowed to

give his 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 (QSC&V) became the philosophy that drove McDonald's

business.

QUALITY

McDonald's India serves only the highest quality products. The attention to food

quality started long before the first restaurant opened. McDonald's India has

established close relationships with local suppliers who provide McDonald's with

the highest quality, freshest ingredients to make its products.

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

while continuously maintaining McDonald's own recognized standards.

McDonald's has established an extensive "cold chain" distribution system in India

to ensure that the products, which arrive at the restaurant from suppliers all over

India, are absolutely fresh. In the restaurants, products and supplies are used on a

"first-in, first-out" basis to ensure freshness. All McDonald's products are

prepared using modern, state-of-the-art cooking equipment to ensure quality and

safety.

SERVICE

McDonald's India provides fast, friendly service -- the hallmark of McDonald’s,

which sets its restaurants apart from others. At McDonald's, the customer always

comes first. Every employee strives to provide 100 percent customer satisfaction

-- for every customer -- every visit. This includes friendly and attentive service,

accuracy in order taking, and anticipation of customer's needs -- such as napkins or

straws. The McDonald’s promise is “With a sense of fun and youthful spirit, we

will proudly serve an exceptional McDonald’s eating experience that makes

all people feel special and makes them smile – every customer, every time.”

CLEANLINESS

McDonald's restaurants provide a clean, comfortable environment especially suited

for families. McDonald's stringent cleaning standards ensure that all tables,

seating, highchairs and trays are sanitized several times each hour. The attention to

cleanliness extends from the lobby to the kitchen to the sidewalk and immediate

areas outside the restaurant.

In addition to urging customers to dispose of their litter properly and offering a

number of trash bins (both inside and outside the restaurants) for their

convenience, McDonald's "Litter Patrols" walk around the restaurants several

times each day picking up litter -- even if it isn't from McDonald's.

Restaurant managers walk through the dining areas each hour, to ensure that it is

clean and well stocked. All restaurants provide a variety of comfortable seating

arrangements to accommodate anyone -- from a single individual to a large family.

The environment is warm, inviting, and well lit.

VALUE

McDonald's menu is priced at a value that the largest segment of Indian consumers

can afford. McDonald's does not sacrifice quality for value -- rather McDonald's

leverages economies of scale to minimize costs while maximizing value to

customers.

McDonald's definition of value is broader than most restaurants of its kind -- it is

more than price. Value at McDonald's is the sum of the total McDonald's

experience: quality food; fast, friendly service; a clean and pleasant

environment, and products priced at very affordable prices for the largest

segment of Indian consumers possible. That is value at McDonald's.

McDonald’s India… Culturally Sensitive

Indianisation of Menu

With the opening of the first McDonald’s restaurants in India- there is much that is

consistent with other McDonald’s restaurants around the world, such as the quality

of the food and the attention to service.

The dedication to local cultures is not new for McDonald’s. For the past 50 years,

McDonald’s has opened restaurants in more than 120 distinctly different countries

and cultures. With guidance from its local partners, McDonald’s is able to adapt-

where necessary-its menu and restaurant operations to complement existing eating-

out options. McDonald’s local owners understand what their customer’s want

perhaps more importantly, what is acceptable within local customs and values.

There is much, too, that is very different- such as the first beef-less and pork-less

menu in the world and special product formulations to cater to Indian culture and

palate. Vikram Bakshi, the joint venture partner for McDonald’s India, says “We

know the Indian culture, because we were born in it, inherited its richness,

and respect it greatly. It is the respect for this culture and the sentiments of

many of our customers’, that we do not serve any beef and pork items in our

restaurants.”

McDonald’s commitment to its Indian customers is evident even in development of

special sauces that use local spices and chilly. The mayonnaise and all other

sauces are egg-less.

In India, vegetarianism is in many cases more than a lifestyle choice. Many people

are vegetarians due to religious reasons, and in some cases even the vegetarian

product that has come into contact with a non-vegetarian product is unacceptable.

Hence, McDonald’s India has also changed its operations to address the special

requirements of our vegetarian customers by having processes that ensure that a

physical separation of veg and non-veg products is maintained right from farm to

the customer. Vegetable products are prepared separately, using dedicated

equipment and utensils. Also in India, McDonald’s uses only vegetable oil as a

medium for cooking.

Every Day Great Value at McDonald’s

McDonald’s worldwide stands for QSC&V, where the ‘V’ stands for value and

therefore the value propositions assumes special significance. Explaining this, Mr.

Vikram Bakshi Managing Director and JVP, McDonald’s India, (North and East)

says “McDonald’s success has been built on commitment to the delivery of

QSC&V (quality, service, cleanliness and value) to customers, the expansion of

restaurant numbers to improve convenience and large scale investment in supplier

development, training and people. Getting QSC&V right consistently and

overwhelming appreciation of value keeps our customers satisfied and maintains

our competitive edge.”

Value as the Corner Stone of McDonald’s Strategy

The value initiative at McDonald’s is all pervasive. “Our strategy is to achieve best

value by enhancing experience (offering best quality), while keeping prices

reasonable. This applies to products we serve to our customers and to every other

aspect of the way we do business”. At McDonald’s, costs are kept low by

increasing efficiency and cutting wastage at all levels. This is possible by advanced

operations, management and human behaviour skills tested over time in 120

countries across the world.

It is important to understand that delivering highest quality doesn’t come easily.

Customers, who walk into a McDonald’s restaurant, expect to be served food that

is hot and fresh, made from high quality ingredients, served within minutes of

placing their order and at a price which is affordable. Such is the strength of the

brand that they rely on McDonald’s to do all this, without thinking about how it is

actually achieved “every day every time”.

McDonald’s has

always believed in

providing value to

the customer.

McDonald’s menu

has always been

priced at a value that the largest segment of the Indian consumers can afford.

McDonald’s does not sacrifice quality for value – rather McDonald’s leverages

economies to minimize costs while maximizing value to customers

McDonald’s embarked on a ‘Branded Affordability’ programme - a special value

offer, for the customer, with the objective of offering consumers products at an

attractive price point. The Branded Affordability programme is not a discount or a

price promotion. It is more on the lines of providing products to the customer that

are very affordable.

McDonald’s Value Offerings

Though all McDonald’s food products offer tremendous value, we continually

review and improve our menu offerings to make sure that we not only meet our

customers’ expectations, but also exceed them. Being affordable to the largest

number of customers is a driving force in our value strategy.

Branded Affordability

The branded affordability programme was rolled out with the introduction of the

soft serve cone, a product with universal appeal, was offered to the customer at an

unbeatable price of Rs 7/-, starting May’ 1998. Soon after, McDonald’s India

introduced the Econo meals at an attractive price point of Rs. 29/-, Rs. 39/- & Rs.

49/- to add to basket of offerings.

McDonald’s had further reinforced the branded affordability mantra via the

introduction of the Happy Price Menu attractively priced starting at Rs. 20/-.

Happy Price Menu includes the McAloo Tikki Burger, Veg Pizza McPuff,

Chicken McGrill, Ice-Tea and Small Soft Serve.

McDonald’s Cold Chain in India

McDonald's India is characterized by a unique sense of dedication and

commitment –‘to be driven by the leadership of local owners.’ This commitment

has translated into enduring benefits to the businesses at the grass root level, in the

areas of introduction of new crops, new agricultural practices and food processing

methods and procedures.

McDonald's 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.

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

state-of-the-art food processing technology by McDonald's and its international

suppliers to pioneering Indian enterprises, which are today an integral part of the

McDonald’s cold chain.

SWOT ANALYSIS

Strengths

McDonalds has built up huge brand equity. It is the No. 1 fast-food company by sales, with more than 31,000 restaurants serving burgers and fries in almost 120 countries. Sales, 2007 (11,4009 million), 5.6% sales growth.

Good innovation and product development. It continually innovates to retain customers in the business.

The McDonalds brand offers consumers choice, reasonable value and great service

Large amounts of investment have gone into supporting its franchise network, 75% of stores are franchises.

Loyal staff and strong management team.

Weaknesses

Core product line out of line with the trend towards healthier lifestyles for adults and children. Product line heavily focused towards hot food and burgers.

Seasonal

Quality issues across the franchise network.

Opportunities

Joint ventures with retailers (e.g. supermarkets).

Consolidation of retailers likely, so better locations for franchisees.

Respond to social changes - by innovation within healthier lifestyle foods. Its move into hot baguettes and healthier snacks (fruit) has supported its new positioning.

Use of CRM, database marketing to more accurately market to its consumer target groups. It could identify likely customers (based on modelling and profiles of shoppers) and prevent brand switching.

Strengthen its value proposition and offering, to encourage customers who visit coffee shops into McDonalds.

The new “formats”, McCafe, having Wifi internet links should help in attracting segments. Also installing children’s play-parks and its focus on educating consumers about health, fitness.

Continued focus on corporate social responsibility, reducing the impact on the environment and community linkages.

International expansion into emerging markets of China and India.

Threats

Social changes - Government, consumer groups encouraging balanced meals, 5 a day fruit and vegetables.

Focus by consumers on nutrition and healthier lifestyles.

Competitive pressures on the high street as new entrants offering value and greater product ranges and healthier lifestyles products. E.g. subway, supermarkets, M&S.

Recession or down turn in economy may affect the retailer sales, as household budgets tighten reducing spend and number of visitors.

CHAPTER 4 CRITICAL REVIEW OF LITERATURE

Previous Research on fast food Industry has shown us a light in this project:

The exploratory Study conducted by Anita Goyal and N.P.Singh on

the topic of Consumer perception about fast food in India:

The Purpose of the study was to estimate importance of various factors affecting

the choice of fast food outlets by Indian young consumers. The Methodology

includes statistical tools to estimate importance of various factors affecting the

choice of fast food outlets by Indian young consumers. In addition, the authors

analysed the consumption patterns, impact of hygiene and nutritional values, and

rating of various attributes of McDonald's and Nirula's. The Findings by the

study indicate that the young Indian consumer has passion for visiting fast food

outlets for fun and change but home food is their first choice. They feel homemade

food is much better than food served at fast food outlets. They have the highest

value for taste and quality (nutritional values) followed by ambience and hygiene.

Three dimensions (service and delivery dimension, product dimension, and quality

dimension) of fast food outlets' attributes are identified based on factor analysis

results. The two fast food outlets' rating differs significantly on the seven

attributes. McDonald's scores are higher on all attributes except “variety”. Further,

consumers feel that fast food outlets must provide additional information on

nutritional values and hygiene conditions inside kitchen. The Practical

implications of Fast food providers need to focus on quality and variety of food

besides other service parameters. There is need to communicate the information

about hygiene and nutrition value of fast food which will help in building trust in

the food provided by fast food players. The Value Estimates importance of various

factors affecting the choice of fast food outlets by Indian young consumers.

The Study conducted by R.V. Sudershan , Pratima Rao and Kalpagam Polasa

on topic of Fast Food consumption and growth opportunities in India

The researchers concluded that with growing international trade, food safety has

emerged as an important global issue. The present research was an attempt to study

the food safety research in India in the past ten years during 1998-2008.

Many studies were focused on detection of pathogenic microorganisms, adulterants

and contaminants in food. However, there is a striking paucity of reliable data on

important issues like evaluation of risks through adulterants, additives and

contaminants. Consequently, the protection of diets from these hazards must be

considered one of the essential public health functions of any country, which

emphasizes the need for total diet studies. The Methodology include the status of

food safety research in India was reviewed by assessing data published in journals,

websites and published data from universities in the form of doctoral theses and

dissertations at the post-graduate level. For this, literature for the years 1995-2005

was reviewed. The studies that were included for this review were those with a

representative sample size and carried out by scholars studying in well-reputed

universities, doctoral theses, original research articles in peer reviewed journals,

annual reports of research organizations and institutions. Qualitative reviews were

reviewed in similar topics and the results were tabulated and compared to get a

better understanding of the research carried out in these issues. The findings by

researchers Health Risk( probability of an adverse event of diarrhea),Hazard

Identification: (pathogens, adulterants, contaminants and their health

effect),Industrial food safety(existing laws, standards, sanitation and hygiene

practices, specific hazards),Hazard Exposure Assessment(how much people eat,

what food they consume and where they consume.),Consumer Behaviour ( hand

washing, hygiene.)

The Study conducted by Mark D. Jekanowski on topic “Causes and

Consequences of Fast Food Sales Growth”, January1999.

Concluded that in today’s hectic lifestyles, timesaving products are increasingly in

demand. Perhaps one of the most obvious examples is fast food. Today the demand

for the, hectic lifestyles, timesaving products are increasingly. Obliviously one of

the examples is Fast Food Industry. The rate of growth in consumer expenditures

on fast food has led most other segments of the food-away-from home market for

much of the last two decades. Since 1982, there is growth rate in consumer

spending at fast food.

The consumers spent at fast food outlets grew at an annually he proportion of

away-from-home food expenditures on fast food also increased.

Everyone eats Fast Food even knowing that it is not healthy for them. Reasons are

because of speed, convenience and price. However, fast food has many hidden

costs, including the high price of bad health. Not to mention the fact that for such

cheap food, you're actually being overcharged by a big amount. So the real reason

is not price, but convenience. You can get much cheaper food by cooking for

yourself, but you are not always at home to do the cooking, or you do not always

feel like cooking. 

Brown, McIlveen and Struggnel (2000) examined the nutritional awareness and

food preferences among young consumers. They suggest that young consumer

decisions regarding food preferences are influenced by nutritional awareness

knowledge. This knowledge is acquired within the home, school and social

environments. They also put forward that education plays important role regarding

healthy eating.

Schiffman and Kanuk, 2004 ,The consumer decision to purchase or not to

purchase the product is crucial for marketers. It can signify whether the marketing

strategy has been wise, insightful, and effective, or whether was poorly planned

and missed the mark. Hence marketers are particularly interested in such process.

Schiffman and Kanuk, 2004

Verbeke (2005) recognizes that at any point in time throughout the decision-

making process, judgements and choices are affected by a variety of stimuli from

environment as well as by internal process and characteristics form the consumers

themselves. Based on earliest presented models of consumer behaviour towards

food (Pilgrim, 1957, cited by Verbeke, 2005) and on a review of factors affecting

food acceptance and behaviour (Shepherd, 1990, Steenkamp, 1997, cited by

Verbeke, 2005) proposed a classification with three types of influencing factors:

environmental factors, person-related factors and properties of the food.

Schroeder and McEachern (2005),in these research he analysed the impact of

McDonald’s and KFC’s corporate social responsibility (CSR) on consumers

purchasing behaviour, authors propose that purchases of fast food are mostly

impulsive, hence suggesting relatively low-involvement in each case.

Lye et al. (2005), in their study of consumer decision models, advocate that the

complexity of consumer decisions is increasing. “We have limited understanding

of the decision process and the models are inadequate at predicting decision

outcomes”. Hence the current models, they argue, are out of date and insufficient

in providing the desired outcome. Nevertheless, the decision-making process

model will provide the author and the reader with general overview and

understanding of factors influencing on consumers purchasing behaviour.

Thus we attempt to identify and focus, along with the attitudes, on the socio-

cultural part of the consumer decision-making process, i.e. impact of

communication and information from mass media i.e publicity of fast food

Consumer attitude formation change

Freiden and Henderson ,(1997) investigated the impact of social values on food

related attitudes, recognize that marketers, consumer psychologists and public

policy makers have an interest in the personal and social values of consumers as

these deeply held feelings of what is important in life influence both consumer

attitudes and behaviour. Reflecting desired end states or ways of living, values

might in part represent some of the fundamental motives that drive and direct the

consumer behaviour. Homer and Kahle 1988, cited by Goldsmith, Freiden and

Henderson (1997) suggest that the influence of values may not be limited just to

high- involvement areas, but may also be relevant to less involving product fields

such as food

Nielsen, Jongen and Meulenberg (1998 ),studied understanding of the factors

that determine consumer perception/attitudes of a product’s value or cost is of

crucial importance to an industry’s product innovation, choice of marketing and

communication strategy and maintenance of competitive advantage.

Baltas (2001), acknowledge that the nature of fast food production and processing

is becoming more important to consumer.

Jobbers (2002) identifies the concept of influences on consumer purchasing

behaviour among which he points out the level of purchase involvement as one of

the factors that influences the consumer decision-making process. Identifies the

concept of influences on consumer purchasing behavior among which he points out

the level of purchase involvement as one of the factors that influences the

consumer decision-making process. (CSR) on consumers purchasing behavior ,

authors propose that purchases of fast food are mostly impulsive, hence suggesting

relatively low-involvem ent in each case.

Harper and Makatouni (2002) note that ethical production in terms of animal and

human welfare and environmental protection are of greatest importance.

Mohr et al. (2002) recognize that information regarding firm’s ethical behaviour is

thought to influence product sales and consumers’ overall image of a company.

Mohsin, (2003).While it is generally accepted that a positive relationship exists

between service quality and customer satisfaction, there is debate with proposals of

a causal link from customer satisfaction to service quality, service quality to

customer satisfaction

Viaene (2003) investigated consumers’ beliefs, attitudes and purchase intentions

with regards to genetically modified food. Attitudes towards GM food are

determined by perception of risk and benefits. When perceived risk is high, that

influence negatively on consumer’s purchase intention. That might be linked to

fast food as well, as eating fatty food may be risky of suffering obese related

diseases.

Verbeke (2005), who examined the influences on consumer decision-making

process towards fresh meat, the hierarchy of effects indicates the different mental

stages that consumer must go through when making buying decision and

responding to marketing or non-commercial messages. In our instance, where the

attitude object is fast food, plus taking into account that fast food is considered to

be low involvement product, the low involvement hierarchy of effects would

occur.

Ajzen (2009) the attitudes are the first determinant of behavior intention. In

consumer behavior context attitude is a learned predisposition to behave in a

consistently favorable or unfavorable way with respect of a given object. Most

researchers agree that attitudes consist of three components: Affect (consumers’

emotions and feelings about the attitude object), Behavior (intention to do

something with regard to an attitude object) and Cognition (believes a consumer

has with an attitude object).

CHAPTER 5 RESEARCH METHODOLOGY

METHODOLOGY

It is the section of a research proposal in which the methods to be used are

described. The research design, the population to be studied, and the research

instruments, or tools, to be used are discussed in the methodology.

MARKETING RESEARCH

Definition of marketing research is by the board of the American Marketing

Association (AMA) is:

“Marketing research is the functions which links the customer and public. To

marketer through information used to identity and define marketing. Opportunities

and problems; generate define and evaluate, marketing actions, monitor marketing

performance, and improve understanding of

Marketing as a process”.

Simply, marketing research is the systematic design, collection, analysis and

Reporting of the data findings relevant to a specific marketing situation facing the

company. Careful planning through all stages of the research is a necessity.

A research may undertake any of three types of research investigations

depending upon the problem. These three types of research included.

· Basic research

· Applied research

· Designated fact gathering

Aim of the project:-

To have an overview of the perception of Indian consumers regarding

McDonald’s.

2.1Primary objectives:-

To judge consumer perception on McDonald’s.

To find out top of mind awareness regarding QSR.

To evaluate performance of WFF (western fast food joint).

To have a better understanding of customer expectations.

To understand the factors that influence consumer decision-making

process w.r.t fast food restaurant industry in India.

2.2Hypothesis :-

1. Ho: There is a relationship between age group and average cost per sitting.

2. Ho: There is a significant relation between age group and fast food preference.

2.3 Research Design: -

The research design selected is exploratory design.

Method of Data Collection

The data was collected through primary source by questioning the consumers with

the help of questionnaire prepared.

Secondary data was collected by company’s website and MIS reports and research

data by Chrome Cube.

Instruments Used

A Questionnaire was prepared to collect data from the sampling unit.

Questionnaire was designed with both close ended and open ended questions. Also

personal interaction and interviews have facilitated to understand the consumer

perception about the brand.

2.4 Sample Design:-

Universe :- Consists of Indians eating outside who form the sampling unit.

Sample size: - 100 consumers who are regular visitors of fast food joints.

Sampling design: - Chosen was Convenience sampling

2.5 Scope of the study:-

Growth opportunities

Strategic advantage on brand building.

Collection of information

Data collection phase is generally the most expensive and the most phase to error.

Carry out the field work, collect data using the instruments, adjust the problem of

not at homes, replaced, refusal to co-operate, biased or dishonest answers.

2.6 Data collection

The information needed to further proceed in the project had been collected

through primary data and secondary data.

2.7 Primary data

Primary data consists of information collected for the specific purpose at hand for

the purpose of collecting primary data, survey research was used and 100 Indians

eating outside regularly were contacted. Survey research is the approach best

suited gathering description. A questionnaire having both open a close ended

question was prepared for the survey conducted.

2.8 Secondary data

The secondary data consists of information that already exists somewhere, having

been collected for another purpose. Any researcher begins the research work by

first going through the secondary data. Secondary data includes the information

available with the company. It may be the findings of research previously done in

the field. Secondary data was collected from magazines, newspapers, other surveys

conducted by known research agencies etc.

2.6Limitations:-

o The demanding nature of human being is unpredictable; the responses may

not yield 100 percent.

o Time was one of major constraints; the research had to be limited within the

given parameter.

o The study was restricted to the geographic boundary of Delhi NCR and

Kolkata.

CHAPTER 5 FINDINGS AND ANALYSIS

Table 4.1

Representing age group of respondents

Age group Respondents PercentageBelow 20 yrs 25 25%

21-25 yrs 30 30%26-30 yrs 35 35%

Above 30 yrs 10 10%

Chart 4.1

Representing age group of respondents.

Analysis: 35% of the respondents fall under the age group 26-30 yrs, followed by

30% between 21-25 yrs and 25% below 21yrs. A small chunk of 10% of

respondents was above 30yrs of age.

Table 4.2

Representing frequency of visits at fast food outlets

Frequency of visits Respondents Percentage      Once a week 37 37%      Twice a week 33 33%      Once in a month 30 30%

Chart 4.2

Representing frequency of visits at fast food outlets.

Analysis:

37% of people visit fast food joints once in a week, 33% twice in a week and 30%

visit the same only once in a month.

Table 4.3

Representing preference of fast food during particular time of a day.

Timings Respondents Percentage      Before 11 am 8 8%      11 am- 2 pm 21 21%      2pm- 6pm 34 34%      6 pm -10pm 36 36%      After 10 pm 2 2%

Chart 4.3

Representing preference of fast food during particular time of a day.

Analysis: 36% of the people prefer to visit fast food joints between 6pm -10 pm

followed by 345 between 2pm-6pm .Least preference is seen to visit fast food

joints after 10pm.

Table 4.4

Representing occasions that attract consumers to consume fast food.

Occasions Respondents PercentageBirthdays 10 10%

Friends parties 5 5%Business meetings 5 5%

Dates 35 35% For fun 10 10%

Just to eat something 40 40%

Chart 4.4

Representing occasions that attract consumers to consume fast food.

Analysis:

40% of people visit fast food joints whenever they feel like to have something, 35% prefer fast food joints for dating purpose and 10% visit fast food joints for fun and at birthdays.

Table 4.5

Representing reasons behind preference of fast food

Reasons Respondents PercentageIt is easily available and quickly served 40 40%It is value for money 20 20%Tasty 10 10%Serves as anytime snacks 30 30%

Chart 4.5

Representing reasons behind preference of fast food.

Analysis:

40% of people prefer fast food as it is easily avilable and quickly served, 30% prefer it as it serves as anytuime snacks and 20% for the value for money factor.

Table 4.6

Representing reasons behind visit to fast food joints

Reasons Respondents PercentageFun place to be in 50 50%

Good for get together 20 20%Place to be with family 10 10%Kids prefer to be there 20 20%

Chart 4.6

Representing reasons behind visit to fast food joints

Analysis:

50% of the people visit fast food joints as it is a fun place to be in followed by 20% who prefer to visit fast food joints as kids prefer and it is a good place for get together.

Table 4.7

Representing drivers towards fast food joints.

Drivers Respondents PercentageTaste of food 5 5%

Quality of food 5 5%Ambience 5 5%

Value for money 25 25%Time savvy 20 20%

Convenience 40 40%

Chart 4.7

Representing drivers towards fast food joints.

Analysis:

40 % of the respondents are driven by convenience to fast food joints followed by 25% for value for money and 20% for time savvy factor.

Table 4.8

Representing preference of eating outside.

Preference Respondents Percentage Street food 20 20%

Family dining out place 20 20%Indian fast food stalls 20 20%

Western fast food joints 40 40%

Chart 4.8

Representing preference of eating outside .

Analysis :

40% of people prefer eating out in western fast food joints rest other options of eating outside are preferred by 20% each.

Table 4.9

Representing healthier food option.

Food options Respondents PercentageFast food 0 0%Home made food 100 100%both 0 0%

Chart 4.9

Representing healthier food option.

Analysis:

100% of the people find home made food as only an option for healthy food.

Table 4.10

Representing amount of money customers are willing to pay on fast food

Amount of money Respondents Percentage Less than 100 48 48%Rs. 100- Rs. 250 38 38%Rs. 250 and above 14 14%

Chart 4.10

Representing amount of money customers are willing to pay on fast food.

Analysis:

48% of the respondents are willing to pay less than Rs.100 for fast food, 38% would pay between Rs. 100- Rs.250. Rest 14% would pay Rs. 250 and above.

Table 4.11

Representing favorite product at McDonald’s.

Product Respondents PercentageMaharaja Mac 20 20%Mc veggie 5 5%Mc chicken 5 5%French fries 20 20%McGrill 5 5%Mc Shakes 5 5%Mc Aloo tikki 30 30%McSpicy 10 10%

Chart 4.11

Representing favorite product at McDonald’s.

Analysis:30% of the respondents like Mc Aloo Tikki, followed by 20% who like Maharaja Mac and French fries.10% of them have also voted the new product Mc Spicy as their favorite.

Table 4.12

Representing views on Mc Donald’s Food.

Hot n fresh Respondents Taste Respondents Variety Respondents Price RespondentsMother's kitchen 40 Yummy 60 Hazaar 5

not 2 much 60

☺ 40 ☺ 40 ☺ 45 ☺ 40

hostel mess 10 Funny 0

Not again Yaar 40

let's go dutch 0

Chart 4.12

Representing views on Mc Donald’s Food.

Analysis:-Majority has voted for best price, best taste. In terms of food being served Hot N fresh it has got majority in best and moderate. But variety seems to be not much in McDonald’s menu.Table 4.13

Representing areas that need improvement in McDonald’s.

Areas Respondents PercentageDelivery Time 35 35%Capaciousness 35 35%Product Variety 20 20%Prices 5 5%Offers and discount 5 5%

Chart 4.13

Representing areas that need improvement in McDonald’s.

Analysis:

35% of people say delivery time and capaciousness needs improvement in McDonald’s. 20% feel product variety is something to be focused on for improvement.

Table 4.14

Representing what strikes consumer mind when they think of McDonald’s.

Image Respondents PercentageBurger 50 50%

Value for money 20 20%fun 10 10%

service 0 0%Golden arches 20 20%

Chart 4.14

Representing what strikes consumer mind when they think of McDonald’s.

Analysis:

50% of the respondents relate McDonald’s to burger 20% think of value for money and golden arches when it comes to McDonald’s

Table 4.15

Representing what clicks consumer mind while choosing a particular restaurant

Reason Respondents Percentage      Proximity 40 40%      Taste 30 30%      Budget 20 20%      Ambience 10 10%

Chart 4.15

Representing what clicks consumer mind while choosing a particular restaurant

Analysis:- 40% think of proximity while choosing a restaurant, 30% for taste and 20% also think of budget while choosing a restaurant.

Table 4.16

Representing factors that attract consumer to McDonald’s.

Factor Respondents PercentagePrice 50 50%Food 35 35%Ambience 15 15%Others 0 0%

Chart 4.16

Representing factors that attract consumer to McDonald’s

Analysis: 50% of the respondents are attracted to McDonald’s for the price, 35% for food and rest 15% because of ambience.

Table 4.17

Representing rating of McDonald’s on various factors.

Ambience Respondents Décor RespondentsValue For money Respondents

Airline 30 Inviting 40 Happy 70☺ 70 ☺ 60 ☺ 30Blueline 0 Frightening  0 Left broke 0Chart 4.17

Representing rating of McDonald’s on various factors.

Analysis: Majority has rated ambience as best in McDonald’s and it is perceived to be brand for value for money by 70% of the people. Décor is being rated as moderate by majority.

Table 4.18

Representing service quality of McDonald’s

ServiceQuick Respondents Impressive Respondents Complete RespondentsFerrari 60 Gold 40 All there 50☺ 40 ☺ 60 ☺ 50

Anari 0 Cold 0what when where 0

Chart 4.18

Representing service quality of McDonald’s.

Analysis: - 60% of respondents have rated McDonald’s best in quick service, moderate in Impressive service while 50% have voted for complete service.

Hypothesis 1

Ho: There is a significant relationship between age group and average cost per sitting.

Table 4.19 Relation between Age Group and Average Cost per sitting

average cost per sitting * age Cross tabulation

Age

Totalbelow 20

21-25 26-30 31-36

average cost per sitting

less than Rs 100

Count 10 15 21 2 48

% within age

21% 31% 44% 4% 100%

between Rs 100 &Rs 250

Count 14 12 9 3 38

% within age

37% 32% 24% 8% 100%

over Rs 250

Count 1 3 5 5 14

% within age

7 % 21 % 36% 36% 100%

Total

Count 25 30 35 10 100

% within age

25% 30% 35% 10% 100.0%

In the above table it is visible that when the age increases the average cost per

sitting also increases and here we are using the Annova Test to check the

significance of this relation.

_____

X1 = 10 + 14 + 1/ 3 = 8

____

X2 = 15+12+3 / 3 = 10

____

X3 = 21+9+5 /3 = 12

____

X4 = 2+3+5 /3 = 3

(X)= 8+ 10+12+3/ 4= 8 where k=4

Now we work out SS between and SS within samples

SS between = 3(8-8)2 + 3(10-8)2 + 3(12-8)2 + 3(3-8)2

= 12 + 48 + 75 = 135

SS within = (4+36+49) + (25+4+49) + (81+9+49) + (1+4)

= 311

SS for total variance= 135+ 311 = 446

Source of

variation

SS df MS F ratio 5% limit

Ss between 135 (4-1)=3 135/3= 45 45/39 =1.2 F(3,8)=4.07

Ss within 311 (12-4)=8 311/8= 39

total 446 11

Thus, rejecting null hypotheses as F value (calculated) is less than tabulated F

value.

Accepting Ha = there is no significant relationship between age and amount of

cost per sitting.

Hypotheses 2:

Ho there is a significant relation between age group and fast food preference

Table 4.20 Relation between Age Group and Preference of Fast-food

age * I PREFER FAST FOOD Cross tabulation

I PREFER FAST FOOD

TotalSTRONGLY DISAGREE

MODERATE AGREESTRONGLY

AGREE

Age

below 20 Response 1 10 4 10 25

21-25 Response 5 5 5 15 30

26-30 Response 20 5 5 5 35

31-36 Response 8 1 1 0 10 ____

X1 = 1+5+20+8/4 = 9

____

X2 = 10+5+5+1 /4 =5

____

X3 = 4+5+5+1/4 =4

____

X4 = 10+15+5+0 /4 =8

(X) = 9+5+4+8 / 4 = 6

Now we work out SS between and SS within samples

SS between = 4(9-6)2 + 4(5-6)2 + 4(4-6)2 + 4(8-6)2

= 36+4+16+16= 72

SS within = (64+16+121+1) + (25+16) + (1+1+9) + (4+49+9+64)

= 380

Source of

variation

SS df MS F ratio 5% limit

Ss between 72 (4-1)=3 72/3= 24 24/32 = .76 F(3,12)=3.49

Ss within 380 (16-4)=12 380/12=32

total 452 15

Thus, rejecting null hypotheses as F value (calculated) is less than tabulated F

value.

Accepting Ha = there is no significant relationship between age and preference

of fast food.

Table 4.21: Representing rating of Mc Donald’s on a five point scale

Five point scale

Excellent Very Good Good Average Bad

% Percentage

49% 48% 3% 0% 0%

Chart 4.21: Representing rating of McDonald’s on a five point scale.

Analysis: Out of 100 respondents, 49% feel that Mc Donald’s is Excellent and 48% feel McDonald’s is very good.

Table 4.22. Rating of KFC in a five point scale

Five Point Scale

Excellent Very Good

Good Average Bad

% percentage

38% 41% 19% 0% 2%

Chart 4.22: Rating of KFC in a five point scale.

Analysis : 41% respondents voted KFC as Very good.

Table4.23 Rating of CCD in a five point scale

Five point scale

Excellent Very Good Good Average Bad

%Percentage 11% 25% 58% 0% 6%

Chart 4.23: Rating of CCD in a five point scale

Analysis: Majority of the respondents voted CCD in the category of “good”.

Table 4.24 Rating of “Barista” on a five point scale

Five Point Scale

Excellent Very Good Good Average Bad

% Percentage

12% 23% 37% 25% 3%

Chart 4.254 Rating of “Barista” on a five point scale

Analysis: 37% respondents voted Barista as Good Restaurant.

Table 4.25: Rating of Pizza Hut in a five point scale

Five Point Scale

Excellent Very Good Good Average Bad

% Percentage

4% 18% 33% 37% 8%

Chart 4.25: Rating of Pizza Hut in a five point scale

Analysis: Majority of Respondents rated Pizza Hut as “Average”.

Findings

Majority of the consumers visit fast food restaurants once in a week and thus they can be

assumed as regular customers of fast food joints.

Most of the people prefer to visit fast food joints during evening time from 6-10 pm

Consumers prefer fast food as it is quickly served and easily available.

Most of the occasions when consumers feel like to have something they choose to eat

fast food and the reason behind visiting fast food joints is it is a fun place to be in.

People generally prefer western fast food joints while eating outside.

Convenience is the driving factor to fast food joints.

People regard home made food as an healthier option to fast food.

Most of the people would like to spend less than Rs. 100 on fast food.

McAloo Tikki and Maharaja Mac are hot favorite of consumers at McDonald’s. McSpicy

being a new product have also been tried by a few and liked too.

Service delivery time and capaciousness is to be improved by McDonald’s.

Burger is what clicks consumer mind when they think of McDonald’s.

Majority has voted for best price, best taste. In terms of food being served Hot N fresh it

has got majority in best and moderate. But variety seems to be not much in McDonald’s

menu.

Price attracts consumer to McDonald’s.

Proximity is that main factor that leads to deciding on a restaurant while eating outside.

Majority has rated ambience as best in McDonald’s and it is perceived to be brand for

value for money by 70% of the people. Décor is being rated as moderate by majority.

McDonald’s scores highest in top of mind awareness of QSR followed by Pizza hut and

KFC.

People have rated McDonald’s as excellent, KFC as very good , Barista and CCD as

good and Pizza hut as average on a 5 point rating scale.

McDonald’s has been rated best in quick service, moderate in Impressive and complete

service.

Product variety is what is expected from McDonald’s by consumers.

People still see fast food as junk food and prefer home made food to fast food for

nutritional reasons.

Recommendations

McDonald’s should focus on increasing product variety thus increasing product line and

width.

McDonald’s should shorten down service delivery time both in-store and in home

delivery.

Brand affordability products should be maintained as price is the main factor that attracts

consumer to the store.

Market penetration should be an initiative taken from company’s side to reach out to

customers everywhere as proximity seems to be one of the deciding factors while

choosing to eat outside.

Congestion is a basic problem at McDonald’s so capacity increment, layout and design of

the store needs to be focused on.

As convenience is a major driving factor to fast food joints McDonalds needs to open up

more of breakfast outlets and drive thru.

Bundling of meals can be introduced and the evening time which has got peak hours-

offers and promotions can be introduced to incentivize customers.

Nutritional flyers need to distributed and people are to be made aware of nutrients present

in fast food.