At the end of the last century, McDonald’s has gone in China. Nevertheless, there are several forces which could affect or have affected the development of McDonald’s, including political-legal, economic, socio-cultural and technological forces would have analyze below.
Due to the socialistic country, China emphasizes the labour right and benefits and forbidden any unreasonable deprival to workers.
If the unfair incident is occurred, the China government will interfere and magnify the justice. In 2007, the government reported McDonald’s have underpaid their part-time employees through the state-owned newspaper. After that, McDonald’s adjusted the salary from 12%-56% higher than the minimum wages when having comparison under the great pressure. Therefore, the corporate image of McDonald’s has been impaired.
In legal force, the modification of franchise law has affected the development of McDonald’s.
China appeared the first franchise relative law in 1997 for domestic enterprises only in order to protect the survival of them. According to the commitment between China and World Trade Organization, China creates the basic law frame to permit the foreign company can have franchise application until 2004. The operating pattern of McDonald’s adopted the joint venture and wholly foreign-owned enterprises (WFOEs).
However, joint venture has caused a series of problem. For instance, McDonald’s’ partners are easier to recognize the unique commercial secret which facilitates them to establish another similar fast-food restaurant. This will trigger the dispute among them in long-run. Even they suggest the legal litigation and seek the court to make the adjudication.
On contrary, WFOEs have several advantages; this can protect the intellectual property right and have the whole personnel management so that McDonald’s has no concern to introduce advance technology and equipment further so as to expand business scale quickl.....[read full text]
It causes the operating cost has the heavy burden because of food raw materials more expensively. McDonald’s raises the selling price surreptitiously so as to transfer the operating cost to their customers. After the public recognize the fact which brew their indignation, their purchasing desire will decrease within anticipation, especially people who always travelling aboard know cheaper price for selling at other foreign countries.
Probably, McDonald’s will lose their support i.....