McDonald's India: Optimizing the French Fries Supply Chain Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Before starting its first store in India in 1996, McDonald's spent six years building its supply chain. Throughout that time, the company worked to supply various ingredients as many as possible from India. However, French fries ("MacFries") were a predominantly rough merchandise to source locally-and importing chips was undesirable for both cost and availability reasons. Growing potatoes appropriate for use as chips was demanding in India. By 2007, 11 years after opening its first restaurant, the MacFry was eventually being produced in India.

McDonald's India Optimizing the French Fries Supply Chain Case Solution

The chief MacFry supplier of McDonald was the Canadian firm McCain, which spent many years working on potato agronomy and with farmers to develop supply in India. From 2007 to 2011, local MacFry generation rose from none to 75 percent of revenue. In spite of the strides made, in 2011 Abhijit Upadhye, McDonald's then senior manager of Supply Chain India was still a apprehensive guy. Double digit food inflation in India had been getting cost pressure on the business. McDonald's had aggressive growth plans for the imminent years. The company had 240 eateries, and planned to more than double by 2014.

The MacFry was the single biggest procurement thing, so having a 100 percent local supply was critical to preventing high import duties. The question that troubled him was: "Will I ever have the capacity to get rid of imported fries from my supply chain?" This case describes McDonald's India and McCain India's efforts to optimize the MacFry supply chain by raising local supply in a fast growing emerging market using agronomy, farmer relationship development and value chain invention.

PUBLICATION DATE: November 19, 2013 PRODUCT #: GS79-HCB-ENG

This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE