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Convenience key to business models in McDonald's
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Saturday, 08 March, 2008, 08 : 00 AM [IST]
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McDonald's Family Restaurant, the world's leading food service retailer, have re-gridded their McDelivery map across their delivery hubs in west and south India. The regridding exercise has recently been completed and the delivery area will now be limited only to 7 minutes from the restaurant. The regridding exercise has been done to ensure the high quality food standards are maintained, said Abhijit Upadhye, Director, National Supply Chain, Menu Management & New Business Channels, in an interview with Bosky Christopher. Excerpts:
What were the market conditions when McDonald's first introduced McDelivery in the country and what lessons did it learn?
Not only is time a valuable commodity, but for many people shopping is a chore, especially for need-based goods such as food and groceries. More and more people are looking for increased convenience.
In early 2000, companies began looking at Home Delivery Service as an added market and allowed consumers to shop for products and have them delivered to their doorsteps. Everything from furniture makers to toy stores and laundry services wanted a piece of the home delivery action.
McDonald's started the home delivery concept in 2004 in Mumbai city and has soon expanded the initiative to other centres, viz. Ahmedabad, Pune and Hyderabad. Home Delivery is a great complement to our restaurants; bringing our high quality food to customers' doorsteps is a logical extension of our restaurants.
The market was opening up, customers were looking for convenience. Metro cities like Mumbai & Delhi were beginning to become like any other urban city across the globe. New York, Dubai, Bangkok or Mumbai & Delhi; people pretty much had begun to have the same kind of lifestyle. People barely had time to spend with their family or loved ones. Distances too were vast. Keeping all these factors in mind, people in Mumbai were willing to buy convenience. The main reason for a boom in home deliveries in a fast paced city like Mumbai is essentially convenience.
"Convenience" is one of the most important factors behind introducing this new business model in India. There are strict guidelines that are followed internally to ensure that customers experience the same standards of quality & food safety at their home as they would experience whilst visiting a McDonald's restaurant. One of the internal guidelines that we followed when this concept was introduced was to restrict the service area to 10 minutes of driving distance. The mapping of the delivery area is such that even during peak hours customers receive orders that are hot and fresh.
Our internal quality trials revealed that, with changing traffic and road conditions, there was a need to further restrict our delivery area to 7 minutes of driving distance instead of 10 minutes. To keep up with our promise of hot and fresh quality food to all our consumers, McDonald's has proactively taken this decision of reducing the service area to 7- minute driving distance.
What has been the strategy that the company has been following in India to build the brand, keeping in mind the consumers want for more choices?
McDonald's has over 11 years of leadership in food service retailing in India. Improving customer convenience is our key strategy to further build the McDonald's brand in India. This would include our efforts to build more restaurants in the country and also offer business models like McDelivery.
What will be your strategy on the menu?
Our R&D team is continuously working on the menu offerings and is also monitoring changing consumer trends and competitive offerings. Our menu strategy would be to continue offering menu choices that are relevant to our consumers and meet McDonald's standards of quality & food safety.
What about the health and nutrition factor? Most of the food offered is in the fast food category, which is generally high in calories?
There is a definitional problem around so-called "unhealthy" food. Most foods are not good for people when consumed in excess. Conversely, most foods are acceptable when consumed as part of a balanced diet.
The emergent health related issue which is caused by the imbalance between calories consumed and calories expended over a period of time. The focus has always been on the consumption side of this equation. We often hear about how 'junk food' is bad. However, no one has given a clear definition of what foods are 'junk'. Junk food is a jargon for foods with limited nutritional value.
In fact, even today, the most common food items that we consume in our homes are rich in calories. In India, we are still very fond of the home-made food and typically most of us still probably only eat maximum 3 meals in a month outside.
Irrespective of where the food is consumed; it is imperative to expend these calories through physical activities.
There is no such thing as junk food, but there is such a thing as a 'junk diet'. The quantity of food consumed, over say a weekly period, is just as important as its quality.
The menu management team is constantly looking at innovating and upgrading our product offering to our customers. In fact, the latest introduction (based on customer feedback and approval) are the NEW wraps which is made of multi grain bread consisting of 5 different kinds of cereals (barley, oatmeal, ragi, wheat flour & maida) and a salad mix of 5 different kinds of vegetables like lettuce, red and green capsicum, red cabbage and carrot. Thus, it has the goodness of cereals and salads.
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