Mcdonald’s Essay

Words: 2991
Pages: 12

Team Work 03-05-2013
BUS 500F
Professor: Assael
Students: Chloe – question 1,4, and 6
Elva – question 3,5 and 7
Emily – question 2 and 8

Chapter 8

Question 1. How do you account for the reluctance of competitors to imitate the successful efforts of another firm in their industry? Under what circumstances is imitation likely to be embraced?

There is much reluctance of competitors to imitate the successful efforts of another firm in their industry. And the only way to be successful by imitating is to beyond the original one. This idea can be proved by the example of McDonald’s and Wendy’s.
McDonald’s Corporation is the world’s largest chain of hamburger fast food
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This point exactly matches to “Greenberg’s Law”, offers convenience to consumers and uses intensive distribution to occupy large market share. Therefor McDonald’s searched for more outlets; it took over stores from weak competitors and developed large numbers of franchisees. The advantages are that at the beginning of expansion McDonald’s outlets coverage almost all its target markets and communities and improve its brand reputation, hence gain temporary success.
Although the additional units increased market share in some markets, a number of franchisees complained that new units were cannibalizing sales from existing ones.
As McDonald’s unprecedented expansion continued, many franchisees were skeptical of headquarters’ claim that no one loses when the company opens more outlets in a given community since market share rises proportionately. It’s a general and simple theory that in a certain community, in a fixed time periods, the purchase power for a kind of product is limited. In term of McDonald’s, if three