Introduction
McDonald’s is the most prominent foodservice merchant globally. The foodservice dealer owns more than 33,500 local cafeterias. McDonald’s serves approximately 68 million customers in 119 nations every day (McDonald’s Corporation, 2012). The foodservice retailer owes its success to its systems, which includes its alignment, franchisees, and contractors. It delivers reliable, locally relevant cafeteria experiences to its clients, and providing community sustainability support in areas where it has operations. The firm uses its strategic direction to facilitate its capability to categorize, implement, and generate inventive ideas, which meets its clients changing needs and favorites. This paper uses the McDonald’s 2011 annual report to discuss diverse aspects of the firm.
A brief overview of the Chairman’s and CEO’s reports
The CEO informed McDonald’s shareholders that global sales had escalated by 5.6% in 2011. The operating income also escalated by 10% and the firm’s market leadership continued globally. During the same period, the corporation returned $6 billion to its shareholders (McDonald’s Corporation, 2012). This was through share repurchases and bonus payments. Furthermore, the firm delivered approximately 35% of its returns to financiers. The CEO also indicated that McDonald’s was generating innovative ways of meeting clients’ culinary interests. The firm is continuing to extensively diversify its menu, digitizing operations, and rebranding. The CEO underscored that McDonald’s performance is significantly driven by two factors. First, is the firm’s continuing implementation of the “Plan to Win,” that has provided strategic direction for the past nine years (McDonald’s Corporation, 2012). The plan concentrates on the key business drives including “people, products, place, price, and promotion” (McDonald’s Corporation, 2012). It has kept the firm disciplined around developing its brand in entirety and improving clients experience in all local cafeterias. Secondly, the firm’s success originates from its collaboration with the system partners.
The chairman reported that shareholders were impressed with the performance of the firm in a tricky economic environment. The chairman indicated that the firm continued to show a passion for adhering to well thought plans, leadership, and strong systems. The firm’s “Plan to Win” was hailed as the greatest guiding strategy (McDonald’s Corporation, 2012). The chairman also underscored the significance of teamwork and competence in enhancing profits and providing shareholders with value.
Analysis of McDonald’s Mission Statement
The foodservice corporation mission statement focuses on clients thus, strives to make their cafeterias the preferred place and manner to eat. The firm seeks to achieve its mission statement through aligning its global operations to the “Plan to Win” strategy (McDonald’s Corporation, 2011). The firm is also committed to an ongoing strategy for improving and promoting clients experience. It is notable that the mission statement aligns with what the company actually does.
The firm’s “Plan to Win” strategy ensures that the foodservice corporation focuses on clients (McDonald’s Corporation, 2011). Clients form the core of all operations in the firm. McDonald’s shows appreciation to its clients through providing food with superior quality, clean and welcoming cafeterias, and value for clients’ money. The mission is also aligned to the firm’s business model that focuses on the operators, workforces, and suppliers. The firm’s business operations are also conducted ethically. Its businesses are conducted at high standards of impartiality, honesty, integrity, and social accountability and responsibility (McDonald’s Corporation, 2011). The alignment of the corporation’s activities to the mission is also seen in its strategies of responding to shifting clients, workforces, and system interests through ongoing development and innovation.
McDonald’s Financial Health
Indicatively, Macdonald has a healthy financial performance. The 2011annual report indicates that since 2006, McDonald’s fortunes continue to escalate. The recorded sales in the firm have continued to propagate over the years. The firm recorded massive improvements in its financial aspects in the recent past. The global sales growth escalated by 5.6% in 2011 compared to 5% in 2010, and 4.4% in 2009. Furthermore, the earnings that were distributed per share grew by $5.27 in 2011 compared to $4.58 in 2010 and $4.11 in 2009 (McDonald’s Corporation, 2012).
The firm also realized total shareholder returns of 34.7% in 2011. Dividends paid to its shareholders have also escalated from $2.2, to $2.4, and $2.6 in 2009, 2010, and 2011 respectively. The market price for McDonald’s shares has also escalated from $62.19, $62.44, $76.76, and $100.00 in 2008, 2009, 2010, and 2011 respectively. Its assets have also escalated over the years as it opens additional franchises. Franchisees operating under Macdonald have also increased globally in the past few years (McDonald’s Corporation, 2012). Indicatively, McDonald’s financial performance is healthy. There are higher probabilities that Macdonald financial performance will escalate in the coming years.
McDonald’s Performance in the Next Five Years
The analysis of McDonald’s financial health indicates that the fortunes have been escalating over the last six years. The investors have increased their capital in the firm over the years thus, obtaining better share returns and dividends annually. The corporation has also continued to attract additional clients globally. Evidently, franchisees have made this possible by opening more franchises globally. It is significant to recognize that Macdonald performance is set to get better in the next five years (McDonald’s Corporation, 2011). This is because the financial health analysis has shown tremendous improvements.
Conclusion
Macdonald Corporation is the world’s best foodservice dealer. Globally, the firm serves approximately 68 million people in its cafeterias. The performance of Macdonald has continued to grow over the years. The firm has implemented diverse activities to guide its strategic direction. Macdonald developed the “Plan to Win” strategy that guides its operations focusing on clients. Notably, the firm has a healthy financial performance indicated by its growth.
References
McDonald’s Corporation. (2011). McDonald’s Corporation 2010 Annual Report: Form 10 – K. Web.
McDonald’s Corporation. (2011). Mission & Values. Web.
McDonald’s Corporation. (2012). McDonald’s Corporation 2011 Annual Report: Form 10 – K. Web.