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Assignment Form |Course: |Financial Accounting | |Instructor: | Qi Jun | |Homework: |McDonalds Corporation & Burger King Corporation | |Name: |??? | |Student ID No. : |10210412 | Class: |10PD | STUDENT DECLARATION I declare that this assignment is my own work, which all sources of reference are acknowledged in full and it has not been submitted for any other course. Signature:…………………… Date:………… Case Write-up McDonald and Burger King are two famous brands in hamburger market, and they both are very successful in their business. But their different strategies in marketing lead to different operation management.
These two cases choose one McDonald’s store and one Burger King’s store to show the difference, which are in the same area. First question: Peak hourly capacity vs. Peak hourly demand As to McDonald’s operation, the peak hour daily is between 12:00pm to 1:00pm, with 15% of daily sales. Big Mac, quarter pounder, quarter pounder with cheese, hamburger, cheeseburger and happy meal are all have patties, so according to Exhibit 1, the total demand of patties in June are: ? 55703 ( number of sandwiches sold) X Percent of Each Sandwiches = total patties |Sandwiches sold |Percent of |Patties | |Sandwiches | | |55703 |18. 8% |20944 | | |5. 9% |3286 | | |8. 8% |4902 | | |22. 0% |12255 | | |21. 7% |12088 | | |5. 4% |3008 | |Total Patties (June) : |56483 | We could assume the patties demand is 56,483 pcs in June, 1980, and 8,188 (14%) pcs are Quarter patties and 48,925 (86%) pcs are hamburger patties.
There are four full weeks and additional one Sunday and Monday in June, 1980. According to Exhibit 2-A (the Weekly and Daily Distribution of Sales in June, 1980), we could calculate the daily demand of patties in June, 1980. |56483 |13271 |Sunday |13. 4% |67. 0% |8892 | | | |Monday |12. 2% |61. 0% |8096 | | | |Tuesday |11. 6% |46. 4% |6158 | | | |Wednesday |12. 3% |49. 2% |6530 | | | |Thursday |15. % |62. 0% |8228 | | | |Friday |17. 8% |71. 2% |9449 | | | |Saturday |17. 2% |68. 8% |9131 | |Total | |425. 6% |56483 | So, the most demand appears on Friday, with 9449 pieces. Exhibit 2-B, the daily volume peaked at lunch, around 14. 9%, which equals to 9449 pcs X 14. 9% = 1408 pcs Burger Patties: 1408 X 14% = 197 pcs Quarter Patties: 1408 X 86% = 1211 pcs
It means that the most demand of patties in one day is 1408 pieces, among which If McDonald’s capacity could meet this demand, then there is no shortage in McDonald’s supply in peak hour. According to the Figure D (Cooking Time), Burger patty takes 100 seconds and Quarter patty takes 270 seconds. As grill person could cook 24 Burger patties and 20 Quarter patties at one time. 197 pcs of Burger Patties will take 16 minutes, but 1211 pcs of Quarter Patties will take 288 minutes, which means the store could not meet Quarters’demand. We could use the same method to analyze Burger King’s operation.
We find that at the peak hour is every Friday at noon, and the max demand is 324 pcs of Whopper or 540 pcs of hamburger, but the max capacity is 330 pcs Whopper or 480 pcs hamburger. It means that Burger King could not meet the Burgers’ demand in peak hour. Second question: How does the management of operations relate to the company’s method of competing in the marketplace? Burger King would like to accept Special Orders, while McDonald’s don’t accept. It leads to different production flow. Burger King will separate an area to produce specialty and it takes more time to finish one Sandwich.