mcdonald’s_supply_chain_in_india
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Mc DONALDS
SUPPLY CHAIN
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AGENDA Introduction History of Mc Donalds Mc Donalds in India Mc Donalds 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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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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HISTORY
1940 Began as a restaurant opened by siblingsDick and Mac McDonald in California
1948 Introduction of Speedy Service System
1955 - Opening of a franchised restaurant by RayKroc
Post 1955 Kroc purchased Mc brothers equityin the company and led to world wide expansion
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McDonalds IN INDIA
Entered India in 1996 through a joint venturewith 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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McDonalds FOUR PILLARS OF SUCCESS
Limited Menu
Fresh Food
Fast Service
Affordable Price
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Mc Donalds 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 theirspecification 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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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 byroad
Regular movement of perishables by air No margin for error Operations critical client
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Mc Donalds SUPPLY CHAIN
CHALLENGES
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Mc Donalds 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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SUPPLY CHAIN STRATEGY
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SUPPLY CHAIN SERVICES FOR McDONALDS
RESTAURANTS
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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 heatafter harvesting
Transportationto distribution
centers inrefrigerated vans
McDonaldsstore products tobe used on daily
basis
2 o c 1 to 4 o c -18 to 4 o c
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VALIDATION OF COLD CHAIN
ComponentQualification
Qualificationcheck on
packagingcomponents
OperationalQualification
To demonstratethat the process
performs at theoperational
extremes
PerformanceQualification
To demonstratethat what
happens in thereal world is
within the limitsof what was
demonstrated inthe Operational
Qualificationlimits
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COLD CHAIN PARTNERS
BEHIND THE Big Mac
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Source: http://www.rediff.com/business/1999/apr/29mac5.jpg
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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 humanizedbaby food
Stringent quality control measures and continuous Research& Development
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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 2 C
within 90 minutes. The pack house, post-cooling and cold room are located at thefarms itself, ensuring no delay between harvesting, pre-cooling, packaging and cold storage
Refrigerated truck for transportation.
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COLD CHAIN PARTNERS (Cont.)
3. Vista Processed Foods Pvt. Ltd. -Supplier of Chicken andVegetable range of products including Fruit Pies
Taloja, Maharashtra. Produces a range of frozen chicken and vegetable foods
The technology includes hi-tech refrigeration plants formanufacture of frozen food at temperatures as low as - 35 c.
Cultural sensitivity: Vegetable & chicken manufactured atdifferent processing lines separated by a shower (washing)area. Utmost care to ensure no mixing up.
R&D facility for innovation in taste, nutritional value andconvenience
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COLD CHAIN PARTNERS (Cont.)
4. Radhakrishna Foodland -Distribution centers for Delhiand Mumbai
Thane, Maharashtra
Handles large volumes
Services include procurement, quality inspection, storage,inventory management, deliveries, data collection, recording andreporting
Dry and cold storage facility to store and transport perishableproducts 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 theMcDonald's restaurants on the basis of their requirements
Very vital role in maintaining the integrity of the products
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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 milkproducts.
Strict quality control supported by a fully equipped qualitycontrol laboratory.
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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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SUPPLY CHAIN INTEGRATION
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Significant business benefits to both the customer and thesupply 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
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REFRENCES
http://www.icmrindia.org/free%20resources/casestudies/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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