McDonald's Food Chain

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McDonald's agreed to promote Disney through its restaurants and opened restaurants in Disney's theme parks. In 1998, McDonald's took a minority stake in Chipotle Mexican Grill - an 18-restaurant chain in the US. In October 1996, McDonald's opened its first restaurant in India. By 1998, McDonald's had 25,000 restaurants in 116 countries, serving more than 15 billion customers annually. During the same year, the company recorded sales of $36 billion, and net income of $1.5 billion. McDonald's overseas restaurants accounted for nearly 60% of its total sales. Franchisees owned and operated 85% of McDonald's restaurants across the globe. However, much to the company's chagrin, in 1998, a survey in the US revealed that customers rated McDonald's menu as one of the worst-tasting ever. Undeterred by this the company continued with its expansion plans and by 2001, it had 30,093 restaurants all over the world with sales of $ 24 billion (Refer Exhibit I for key statistics of McDonald’s). By mid 2001, the company had 28 outlets in India.

In Search of Perfect Logistics - The Story of the Cold Chain

In 1996, when McDonald's entered India, it was looking for a distribution agent who would act as a hub for all its vendors. Mumbai-based Radhakrishna Foodland Private Limited (RFPL) was chosen for the job as it was already a distributor for its sister concern, Radhakrishna Hospitality Services, a catering unit supplying to offshore institutions. The iceberg lettuce from Ooty, mutton patties from Hyderabad and sesame seed buns from Punjab were all delivered to RFPL's distribution centre (cold storage) in its refrigerated vans.

RFPL stored the products in controlled conditions in Mumbai and New Delhi and supplied them to McDonald's outlets on a daily basis. By transporting the semi-finished products at a particular temperature, the cold chain ensured freshness and adequate moisture content of the food. The specially designed trucks maintained the temperature in the storage chamber throughout the journey. Drivers were instructed specifically not to switch off the chilling system to save electricity, even in the event of traffic jam.

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