1. Mc DONALD’S
SUPPLY CHAIN
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2. AGENDA
• Introduction
• History of Mc Donald’s
• Mc Donald’s in India
• Mc Donald’s Supply chain
▫ Supply Chain Challenges
▫ Supply Chain Strategy
▫ Cold Chain
▫ Validation of cold chain
▫ Cold chain partners
▫ Logistics
▫ Result of Supply chain Integration
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3. INTRODUCTION
• Leading global food service retailer
• 32, 000 local restaurants, 60 million people,
more than 100 countries
• Hamburgers, Chicken sandwich, French fries,
soft drinks, breakfast items and desserts
• Local deviation from the standard menu
• Abide by regional taboos
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4. HISTORY
• 1940 – Began as a restaurant opened by siblings
Dick and Mac McDonald in California
• 1948 – Introduction of “Speedy Service System”
• 1955 - Opening of a franchised restaurant by Ray
Kroc
• Post 1955 – Kroc purchased Mc brothers equity
in the company and led to world wide expansion
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5. McDonald’s IN INDIA
• Entered India in 1996 through a joint venture
with Hardcastle Restaurants Pvt. Ltd. and
Connaught Plaza Restaurants Pvt. Ltd.
• 160 restaurants in India
• Special menu with vegetarian selection, no beef
• Products using Indian spices - McVeggieburger,
McAloo Tikki burger
• Indian local suppliers provide McD with highest
quality freshest ingredients
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6. McDonald’s– FOUR PILLARS OF SUCCESS
Limited Menu
Fresh Food
Fast Service
Affordable Price
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7. Mc Donald’s SUPPLY CHAIN IN INDIA
• Source all its requirements from within India
• Developed local business
• Works with 38 different local suppliers
• Trained local farmers to produce according to their
specification
• Worked with vendor to get the perfect cold chain in
place
• Distribution centers – Noida, Kalamboli, Bangalore,
Kolkata
• Cold chain – Unique concept of McD supply chain in
India
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8. • Full Supply Chain responsibility
• Multi Temp. Products - Over 65 % temperature
controlled
• Stores as far as 500 – 1000 kms
• Drops per month - Over 1000 - Movement mainly by
road
• Regular movement of perishables by air
• No margin for error – Operations critical client
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Mc Donald’s SUPPLY CHAIN
CHALLENGES

9. Mc Donald’s SUPPLY CHAIN CHALLENGES
(cont.)
• No Stock Outs at store
• On time delivery record – above 97 %
• Clean delivery record – above 99 %
• Unfailing inbound supply chain
• Bull whip effect
• Cannibalization
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10. SUPPLY CHAIN STRATEGY
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11. SUPPLY CHAIN SERVICES FOR McDONALD‘S
RESTAURANTS

12. COLD CHAIN – LIFELINE OF FAST FOOD BUSINESS
• Temperature controlled supply chain
• Series of storage and distribution activities
which maintain a given temperature range
• Extend and ensure the shelf life of food products
Locked in pre-
cooling room to
remove field heat
after harvesting
Transportation
to distribution
centers in
refrigerated vans
McDonald’s
store products to
be used on daily
basis
2o c 1 to 4 o c -18 to 4 o c
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13. VALIDATION OF COLD CHAIN
Component
Qualification
• Qualification
check on
packaging
components
Operational
Qualification
• To demonstrate
that the process
performs at the
operational
extremes
Performance
Qualification
• To demonstrate
that what
happens in the
real world is
within the limits
of what was
demonstrated in
the Operational
Qualification
limits
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14. COLD CHAIN PARTNERS
BEHIND THE Big Mac
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Source: http://www.rediff.com/business/1999/apr/29mac5.jpg

15. COLD CHAIN PARTNERS
1. Dynamic Dairy Industries - Supplier of Cheese
▫ Baramati, Maharashtra
▫ Immense benefit to farmers by setting up a network of milk
collection centres equipped with bulk coolers
▫ From farm two degrees Celsius in 90 minutes
▫ Fully automatic international standard processing facility
▫ Capability to convert milk into cheese, butter/ghee, skimmed
milk powder, lactose, casein & whey protein and humanized
baby food
▫ Stringent quality control measures and continuous Research
& Development
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16. COLD CHAIN PARTNERS (Cont.)
2. Trikaya Agriculture-Supplier of Iceberg Lettuce
▫ Talegaon, Maharashtra
▫ Grow lettuce all year round with the help of experts from Mc
Donalds
▫ A specialized nursery with a team of agricultural experts
▫ Vegetables are moved into the pre-cooling room within half
an hour of harvesting.
▫ The pre-cooling room ensures rapid vacuum cooling to 2º C
within 90 minutes.
▫ The pack house, post-cooling and cold room are located at the
farms itself, ensuring no delay between harvesting, pre-
cooling, packaging and cold storage
▫ Refrigerated truck for transportation.
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17. COLD CHAIN PARTNERS (Cont.)
3. Vista Processed Foods Pvt. Ltd. -Supplier of Chicken and
Vegetable range of products including Fruit Pies
▫ Taloja, Maharashtra.
▫ Produces a range of frozen chicken and vegetable foods
▫ The technology includes hi-tech refrigeration plants for
manufacture of frozen food at temperatures as low as - 35° c.
▫ Cultural sensitivity: Vegetable & chicken manufactured at
different processing lines separated by a shower (washing)
area. Utmost care to ensure no mixing up.
▫ R&D facility for innovation in taste, nutritional value and
convenience
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18. COLD CHAIN PARTNERS (Cont.)
4. Radhakrishna Foodland -Distribution centers for Delhi
and Mumbai
▫ Thane, Maharashtra
▫ Handles large volumes
▫ Services include procurement, quality inspection, storage,
inventory management, deliveries, data collection, recording and
reporting
▫ Dry and cold storage facility to store and transport perishable
products at temperatures upto -22 Degree Cel.
▫ Effective process control for minimum distribution cost
▫ Variety of items coming from across India, stored in rooms with
different temperature zones and are finally dispatched to the
McDonald's restaurants on the basis of their requirements
▫ Very vital role in maintaining the integrity of the products
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19. COLD CHAIN PARTNERS (Cont.)
5. Amrit Food- Supplier of long life UHT Milk and Milk
Products for Frozen Desserts
▫ Ghaziabad, Uttar Pradesh
▫ ISO 9000 company
▫ Manufacture widely popular brands – Gagan Milk and
Nandan Ghee
▫ State-of-the-art fully automatic machinery requiring no
human contact with product, for total hygiene.
▫ Installed capacity of 6000 ltrs/hr for producing homogenized
UHT (Ultra High Temperature) processed milk and milk
products.
▫ Strict quality control supported by a fully equipped quality
control laboratory.
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20. LOGISTICS
• Handled by AFL Logistics Ltd.
• ~100 sales items in the restaurant
• ~400 SKUs in the warehouse (Hubs: up to 1,500)
• ~200 restaurants per DC (~180 DCs globally)
• Delivery frequency: ~3/wk, higher in urban areas
• 2-3 stops per route
• Exclusive distributors (3PL)
• Freight consolidation (via freight forwarders)
• Long term partnerships with service providers, risk
sharing
• Strong quality focus (Cold Chain, HACCP, QIP)
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21. SUPPLY CHAIN INTEGRATION
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22.  Significant business benefits to both the customer and the
supply chain
 Enablers
 One stop shopping concept - Central file management
 Inventory management - Restaurant simplification
 Synchronizing the perishable Supply Chain
 Demand forecasting
 Promotional + Continuous Supply
 Supplier and DC level
 Supply Planning
 Restaurant and DC level
 Visibility and Collaboration across the chain
RESULT OF SUPPLY CHAIN INTEGRATION

23. REFRENCES
• http://www.icmrindia.org/free%20resources/casestudie
s/McDonald%20food%20chain-7.htm
• http://www.articlesbase.com/marketing-
articles/mcdonalds-india-supply-chain-729402.html
• www.expresshospitality.com/20070315/management06
.shtml
• www.mcdonaldsindia.com
• www.nrf.com/Attachments.asp?id=9504
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