McDonalds E-Procurement,

Logistics and Supply Chain

Management
Supply Chain
Management
by M. Ali Khan

McDonalds Supply
Chain, E Procurement
and Logistics
Supply chain management is network of
interconnected business in the ultimate provision
of product and services require by end customer
Scm span all movement and storage of raw
material, work in process, finishes goods from
point of origin to point of consumption.
Mc Donald's scm integration
Successful scm require a change from managing
individual function integrating activities into supply
chain process.
Supply chain process integration involves
collaboration work between buyers suppliers,
common system and shared information.
Customer relationship management
Customer service management
Demand management
Order fulfillment
Manufacturing flow management
Supplier relation ship management
Product development and commercialization
Returns management
Procurement
Physical distribution
Out sourcing
Performance measurement
Supply chain strategies
Two types
Push strategy
Pull strategy
Push strategy
Communication between buyer and seller
Interactive and non interactive

Pull strategy
Ina pull strategy the customer request the product
and pulls through a delivery channel.
WHAT I S E- PROCUREMENT
BY
JAHANZAI B DI LAWER
( MBE- SP08- 1 3)
McDonalds E-Procurement
E-Procurement
E-procurement (electronic procurement,
sometimes also known as supplier exchange) is the
business-to-business or business-to-consumer or
Business-to-government purchase and sale of
supplies, Work and services through the Internet as
well as other information and networking systems,
such as Electronic Data Interchange and Enterprise
Resource Planning.

How E-Procurement Works
e-procurement is a Web sites that allows qualified
and registered users to look for buyers or sellers of
goods and services.
Buyers or sellers may specify costs or invite bids
online.
Customers can Qualify for volume discounts or
special offers on the web.
It also allows automated buying and selling using e-
procurement software.

Ariba Buyer
Softwares of E-procurement System
Other softwares in E-Procurement System.
Coupa.
Mikrofax.

Types of E-Procurement

Web-based ERP
e-MRO
e-sourcing

e-tendering

e-reverse auctioning

e-informing

e-market sites
There are seven types in E-Procurement:
Web-based ERP (Enterprise Resource
Planning):
(Creating and approving purchasing
requisitions, placing purchase orders and receiving
goods and services by using a software system
based on Internet technology.)
e-MRO (Maintenance, Repair and Overhaul).
(Only for maintenance and repairing concerns)
e-sourcing
(Identifying new suppliers for a specific category
of purchasing requirements using Internet
technology).
e-tendering:
(Sending requests for information and prices to
suppliers and receiving the responses of suppliers
using Internet technology).
e-reverse auctioning:
(Using Internet technology to buy goods and
services from a number of known or unknown
suppliers).
e-informing:
(Gathering and distributing purchasing
information)
e-market sites:
(Web-based ERP to open up value chains).
McDonalds E-Procurement System
McDonalds E-Procurement System is basically a
main reason for their successful supply chain
management.

It is so efficient that it provides the backbone not
only to all the logistics but the whole McDonalds
supply chain management.
How McDonalds Uses E-procurement Systems
Emac Digital:
(Internet procurement site designed for
McDonald's Corporation's 27,000 franchises )

Emac Digital Company is E-Procurement website
which is jointly owned by McDonalds and Accel-KKR
Internet Co.

It is a procurement hub launched in 2001 allow all of
McDonald's franchises across the globe to buy
everything needed to run their restaurants.
From
uniform to HamBurger
Aside from being faster and more convenient for
franchisees, the procurement site also allow business
owners to buy supplies and materials at a discounted
price, ultimately reducing costs for McDonald's.

E-Procurement allows 85% cut in costs according to
McDonalds supply chief Edwards.
Benefits For the Suppliers
McDonalds works with two types of suppliers.


Major Suppliers
Small Suppliers

Major
Supplier
Small
Suppliers
Emac
Digital
McDonalds E-Procurement Model



Place Orders Supply Received




Emac Digital
Global
Franchises
Supplier
s
Logistics
IP (Internet protocol) technology:

An IP connection would also open up a host of
options for McDonald's to collect data from its
consumers. Internet connections for kids at store
locations would not be out of the question. The
quicker connection would also allow McDonald's to
track purchases and offer customer loyalty programs.



it will connect headquarters with stores.
Replacing traditional and old Dial-up Networking.
McDonald's can collect data much faster
Working on SRM (suppliers relationship
Management) with Oak Brook.

Developing Next generation e-procurement software
POS.

So, McDonalds e-procurement system is benchmark
while provide final service to the customers form
suppliers to customers dish.





Ahmed Ishtiaque
McDonalds Logistics Standards

Distributor Quality Management Process
Operations and Customer Relations
Quality Control (HACCP/QIP)
Cold Chain Standards
Hygiene Regulations
Product Handling Standards
Emergency and contigency plan







McDonalds Logistics Standards
Risk and Crisis management
Continuous unannounced internal and 3
rd
party
audits for DCs result in superior quality scores
regularly

INFORMATION
Efficiency
Responsiveness


Transportation
The DCs have focused all their resources to meet
McDonald's expectation of 'Cold, Clean, and On-
Time Delivery' and plays a very vital role in
maintaining the integrity of the products
throughout the entire 'cold chain'.
Transportation
The DC receives items from different parts of the
country.
These items are stored in rooms with different
temperature zones and are finally dispatched to the
McDonald's restaurants on the basis of their
requirements.
Transportation
The company has both cold and dry storage
facilities with capability to store products up to -
22 C as well as delivery trucks to transport
products at temperatures ranging from room
temperature to frozen state.
The specially designed trucks maintained the
temperature in the storage chamber throughout
the journey.
McDonalds Distribution systems
McDonald uses three types of Distribution strategy
Franchising
Licensing
Joint ventures

I will discuss them briefly
McDonalds Distribution systems
Franchising
McDonald require franchising from countries on conditions like this
The entrepreneur should be trained.
45000$ in franchise fees which is higher than other fast-food companies
Total investment would range from 1 million to 1.8 million
After setting the entrepreneur will have to pay 12.5 % as royalty tax
Contract wll be for 20 years
Cash liquidity should be around 250000


McDonalds Distribution systems
Licensing
The Lakson Group of Companies is one of the largest and most well-
diversified companies in Pakistan with a range of foreign affiliated partners
that include Tetley Tea, Colgate-Palmolive, McDonalds, Kraft Foods and
Phillip Morris International.
Colgate-Palmolive Inc.:
30% equity ownership in Colgate- Palmolive (Pakistan) Limited
McDonalds Corporation:
Siza foods (Pvt.) Limited holds an exclusive Country Development License
for Pakistan.
Kraft Foods:
Holds an exclusive licensing exclusive Country Development License for
Pakistan.
Tetley Overseas Holdings Ltd:
50% equity ownership in Tetley Clover

McDonalds Distribution systems
Samsung Corby Crave Hit McDonalds: Samsung Electronics
Company Limited, as a joint promotion with McDonalds
Pakistan, has introduced the latest Samsung Corby Series mobile
phones at McDonalds outlets across Pakistan. McDonalds
customers are provided with a chance to win this fabulous
cellular product through participation.
The youth oriented series is focused on interactivity and is laced
with exciting features such as video, images, sound, music and
data sharing. The joint promotion aims to generate excitement
among the youth and providing them a feel of the touch phones
and boosting their comprehension.
Other than this McDonalds have license on Airports, Railways
etc.

waqar saleem pashah
McDonalds Distribution systems
Joint venture
GAM Corp (Private) Ltd is a joint venture company of McDonalds
Corporation USA. Mc Donalds is worlds leading Fast Food chain
having over 30,000 restaurants world wide. Total strength of staff in
Pakistan is 1800 person. It has successfully opened 14 restaurants in
Punjab.
Other than this TOYS R US is another joint venture



Thank you