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CHAPTER 1: INTRODUCTION 1. 1 Introduction to Fast-food Fast-food industry is a type of industry that prepares and serves food in a short period of the time at a fast-food restaurant at a low cost to customers. It regarded as “good food, served quickly, and at a reasonable price” by Hank McDonald. The implementation of the Drive-Thru system also boosted the services of fast-food industry. So, for customers who prefer not to get out from their car can now purchase their favourite food easily. Fast-food industry started in America four decades ago with hot dog and hamburger stands in California.

It then began to spread to whole the country selling a variety type of foods. The current four market leaders in the fast-food industry around the world are McDonald’s, Kentucky Fried Chicken (KFC), Taco Bell and Wendy’s International. However, the market leaders of fast-food industry in Malaysia are KFC, followed by McDonald’s, Burger king and Mary Brown. Nowadays, fast-food is served not only in restaurants, but at drive-thru, stadiums, airports, college campuses, schools, cruise ships, trains, gas stations, and even hospitals’ canteens.

It is now growing rapidly since the beginning of 21st century in many countries around the world. Therefore, most of the fast-food restaurants had grown and become household names in the world. 1. 2 History of McDonald’s Raymond Albert Kroc was the exclusive distributor of a milk shake maker called the Multimixer. Meanwhile, two brothers, Richard and Maurice McDonald owned and ran a hamburger restaurant in San Bernadino, California, in the 1950s. Ray Kroc heard how well the McDonald brothers were doing using his Multimixers to serve their customers.

He met up with them and acquired the franchising right from them to run McDonald’s restaurants. In 1955, Raymond Albert Kroc founded the McDonald’s Corporation and opened the first restaurant in Des Plaines, Illinois. In 1961, he bought over the McDonald brothers’ restaurant business. Since then, McDonald’s had grown into the largest restaurant organization in the world. Today, there are more than 30,000 McDonald’s restaurants serving more than 47 million customers each day in over 100 countries. However, Raymond Albert Kroc died in 1984 but his egacy is very much alive. His success story continues with McDonald’s families of employees, franchisees and suppliers. His commitment, dedication and achievements continue to live on at McDonald’s restaurants across the world. In Malaysia, McDonald’s was first brought by Tan Sri Vincent Tan during December 1980. Then, the first McDonald’s restaurant opened outside of the Klang Valley was in Holiday Plaza at Johor Bahru on 29th October 1984. Moreover, in 7th March 1987, McEgg was first introduced in Malaysia.

Furthermore, Mohamed Shah bin Tan Sri Abdul Kadir, the former Managing Director and joint venture partner of McDonald’s Malaysia, joined the McDonald’s family in 1988. Meanwhile in the year 1990, Ronald McDonald Children’s Charities Fund of Malaysia (RMCC), McDonald’s charity arm was established and McDonald’s delivery was introduced on 28th March 1994. During the following year, the first McDonald’s Hot Kiosk was opened in Kota Bharu and besides that, McDonald’s is the first Quick Service Restaurant to obtain Halal certification.

McDonald’s opened its 100th restaurant at Sunway Pyramid shopping complex on July 1997. A year after that, McDonald’s first highway restaurant, Awan Besar was opened. A new brand promise, “We’re out to make you smile” was put forward in celebration of the new millennium on July 1999. The first McDonald’s Cold Kiosk was opened at Megamall Kuantan on 29th April 2000. After 3 years, there was the launched of the “I’m lovin’ it” campaign to revitalize the McDonald’s brand.

Subsequently, the annual Olympic Day Run was introduced to mark McDonald’s worldwide partnership with the International Olympic Council during July 2004. There was a recognition by the Malaysia Book of Records for the Largest Participation for a Drive-Thru Challenge and the first Malaysian child, Kevin Khoo was chosen as a Player Escort at the 2006 FIFA World Cup Germany under the McDonald’s Player Escort Programmed in the year 2006. At last, McDonald’s had celebrated its 25th Anniversary in Malaysia on April 2007. 1. 3 Problems Definition and Objective of McDonald’s

Since fast-food (McDonald’s) is so convenience, popular and commercially successful in most modern societies, however, they are still facing many problems in their products or business. According to Chris Mercer, McDonald’s had faced the fats or cholesterols of its products problem. “Yet, open kitchens hardly have the air of a sound growth strategy. What is it that McDonald’s thinks consumers will see that will be so uplifting? Ready-made burgers get fried; ready-made fries get thrown into oil. Is it going to look any different from the other side of the counter?

In essence, fat, sugar and salt are no longer the flavours of the decade. However, fast-food still sells, and the children still love McDonald’s. The problem is that their parents are increasingly averse. Moreover, the competition in fast-food industry is now well established, and exciting. McDonald’s can compete by going head-to-head with such competitors through more creative renovations, and brand-building type of marketing strategies. And if it follows these strategies, it can further gain its competitive advantage in terms of fun, fast and family.

Perhaps another wiser route would be targeting the children segment by providing more new and appealing innovative products that suit children nowadays. This amounts to more carrot-stick approaches such as discounted or free limited edition toys now often offered on the children’s menu. McDonald’s needs to throw out the boring and fatty past, and launch a new menu made with new ingredients in a new 21st century family-friendly environment. Another problem McDonald’s is facing is the company share price had dropped.

According to Greg Feirman, “An independent analyst reported that based on his survey of McDonald’s franchises’ sales appear to have been weaken. In addition, Friedman Billings Ramsey initiated coverage at “Hold” with a $53 price target saying that a “turn in sales trends will come” sometime and that “McDonald’s shares are fully valued”. McDonald’s shares, which were one of the best performers in the Dow past years, were getting crushed, down 7% on big volume. ” According to Mercedes Daniels, While McDonald’s new corporate management is more concerned with profit, “Labour is affected, less and less f it means poor service and less cleanliness, means managers and crews work harder to give poorer service, fast-food? Near impossible when a min of 9 transactions per each working person is the standard (regardless of how large each transaction is, means, an order with a Big Mac rates the same as an order for 50 Big Macs in regards to labour! ) Profitability is so desired that issues of poor equipment and it’s maintenance is also down-played, one store recently had earth worms burrowing up from under the lobby counter and happily living in the ice machine for over two months!

While regular cleaning did not resolve the problem, it took an internal whistle blower to get the problem properly looked at and fixed! If you leave this corporation with multiple complaints of poor treatment and support, complaints that you can no longer work in an environment that does not appreciate its crew or customers. Well, don’t bother calling Human Resource and asking for intervention. “There’s a new sheriff in town and people are a dime a dozen” and even if you earned a bonus during the past quarter, if you quit (even with the requested proper notice) you will never see your earned bonus.

I guess if McDonald’s needs the money earned, not easily by the manager, then I hope they are happy with spending my money, while minimum wages went up, and dollar menus were only slightly effected the higher corporate officials are not suffering a pay cut. so the money to keep things across the board as “normal as possible” has to come out of labour and I guess cheating their own by not giving what was earned and promised, so much for them. I’ll never spend another dollar at any of them! ” CHAPTER 2: LITERATURE REVIEW 2. 1. 1 Definition of Product

Product can be defined as anything that is produced, whether as the result of generation, growth, labour, or thought, or by the operation of involuntary causes; as, the products of the season, or of the farm; the products of manufactures; the products of brain (BrainyDictionary, 2005). In business, a product is a good or service which can be bought and sold. In marketing, a product is anything that can be offered to a market that might satisfy a want or need. In retailing, products are called merchandise. In manufacturing, products are purchased as raw materials and sold as finished goods. (Kotler, P. , Armstrong, G. Brown, L. , and Adam, S. (2006) Marketing, 7th Ed. Pearson Education Australia/Prentice Hall). Products are tangible. Products are “well defined” and observable by their existence at the time of customer evaluation, the formation of perception and expectations. Products often offer the opportunity to see, touch, feel, smell, taste, compare, and measure. (BrainyDictionary, 2005). Products are definable and observable. Products allow “seeing believes”. Products often allow direct observation and comparison that influence the perceptions of needs product match and other factors that influence perceived value. BrainyDictionary, 2005). Products are returnable. A customer often can return or exchange defective products or a product that ex post does not match ex ante perceptions of needs match. (BrainyDictionary, 2005). Products are impersonal or in other words customers frequently view products as less personal or unimportant. A customer may perceive the servicing of her car (balancing the tires) as more personal than the purchase of a product (the tires). This person may perceive a fault in the quality of a product as less personal than is perceived in the quality of the service rendered. BrainyDictionary, 2005). Product definition is a critical starting point in the development of any new product. Yet for its importance, there are a number of common shortcomings to the process of product definition in many companies: (Kenneth Crow, 2002). • No defined product strategy or product plan • Lack of formal requirements as a basis for initiating product development • Product requirements developed without true customer input • A marketing requirement specification (MRS) that is completed late – after development is underway • Engineering having little or no nvolvement in development of MRS, thereby lacking a true understanding of requirements • An incomplete, ambiguous, or overly ambitious MRS • Creeping elegance or a constantly evolving specification that requires increasing development scope and redesign iteration A company doesn’t blindly respond to customer needs and opportunities. A business strategy which defines customers and markets to be served, competitors, and competitive strengths provides a framework from which to evaluate potential opportunities.

The result of this evaluation of opportunities is expressed in a product plan. (Kenneth Crow, 2002). Product Planning The product plan helps resolve issues related the markets, the types of products and the opportunities that the company will invest in and the resources required to support product development. More specifically, the product plan is used to: (Kenneth Crow, 2002). • Define an overall strategy for products to guide selection of development projects; • Define target markets, customers, competitive strengths, and a competition strategy (e. . , competing head-on or finding a market niche); • Position planned products relative to competitive products and identify what will differentiate or distinguish these products from the competition; • Rationalize these competing development projects and establish priorities for development projects; • Provide a high-level schedule of various development projects; and • Estimate development resources and balance project resource requirements with a budget in the overall business plan.

Few companies have a formal product planning process, let alone a rigorous process. While a product plan is generally prepared on an annual basis, it should be reviewed and updated at least quarterly, if not monthly. Market conditions will change, new product opportunities will be identified, and new product technology will emerge all causing a potential impact to the product plan. These opportunities need to be evaluated and the product plan changed if needed. These changes may result in re-prioritizing evelopment projects or making a decision to hire additional development personnel to undertake a new development opportunity. (Kenneth Crow, 2002). 2. 1. 2 Research Done on Product and Fast-Food Industry The product of the fast-food industry or fast-food is the term given to many items that can be prepared and served quickly. While any meal with low preparation time can be considered to be fast-food, typically the terms refers to food sold in a restaurant or store which is rapidly prepared and served to the customer in a packaged form for take out or take away. John Jakle, 1999). Aside from the salad greens, tomatoes and some toppings, most fast-food arrives at the restaurant frozen, canned, dehydrated or freeze-dried. (Eric Schlosser, 2001). Consumer value is a highly complex concept in that it integrates an array of possible product quality attributes, process-related attributes and less tangible sources of value, in particular, brand image (Schro? der, 2003). For fast-foods, product attributes may be further broken down into nutritional, sensory and hygienic quality.

The nature of food production and processing is becoming more important to consumers (Baltas, 2001; Bredahl et al. , 1998), even if these aspects cannot be verified through the actual consumption of the food (credence attributes). Ethical production in terms of animal and human welfare, and environmental protection are key issues here (Harper and Makatouni, 2002; Wier and Calverley, 2002; Grankvist et al. , 2004). Holbrook’s (1999) typology serves as a mapping tool for generic consumer value and is highly applicable to the food context.

For example, it highlights both functional consumer value (which might be interpreted as food safety and nutritional make-up) and ethics. However, corporate image is only partially built on tangible product and process attributes. At McDonald’s, they believe great product comes from great quality. Their products (meals) are delicious because they use ingredients of the highest quality, ensuring customers get only the best and the freshest. Not only that, McDonald’s follows the strictest food safety and preparation standards at every McDonald’s restaurant around the world. They work closely with the

Malaysian government as well as with the world’s top experts to make certain McDonald’s has the most effective, most advanced programmes and policies that prevent their food safety standards from being compromised. (www. mcdonalds. com. my, 2008). From farm to counter, they thoroughly monitor every step. They work only with dedicated suppliers who meet their high social, environmental and animal welfare standards. McDonald’s hold them and itself accountable to this commitment. So when customers visit McDonald’s, they know they are getting great-tasting food each and every time. www. mcdonalds. com. my, 2008). To ensure that all McDonald’s restaurants serve products of uniform quality, the company uses centralized planning, centrally design training programs, centrally approved and supervised suppliers, automated machineries and other specially designed equipment, meticulous specifications, and systematic inspections. That can also be known as standardization of products. (Robin Leidner, 1993). Only the best from McDonald’s reputable suppliers will meet their stringent requirements.

Not only are their meat suppliers IS09001: 2000 certified, the suppliers have also been awarded the Veterinary Health Mark by the Department of Veterinary Services. This means the suppliers are in compliance with all the veterinary inspection regulations. Other standards McDonald’s hold itself to, are the Quality Assurance Programme (QAP) and Hazard Analysis Critical Control Point (HACCP) system. So McDonald products are always safe to eat. In addition, their chicken and beef are certified halal by JAKIM (Jabatan Kemajuan Islam Malaysia). (www. mcdonalds. com. my, 2008). 2. 2. Definition of Service Quality Service quality is a concept that has aroused considerable interest and debate in the research literature because of the difficulties in both defining it and measuring it with no overall consensus emerging on either (Wisniewski, 2001). There are a number of different ‘definition’ as to what meant by service quality. One that is commonly used defines service quality as the extent to which a service meets customers’ needs or expectations (Lewis and Mitchell, 1990: Dotchin and Oakland, 1994: Asubonteng el al. ’ 1996: Wisniewski and Donnelly, 1996).

Most of the service quality definitions fall within the customer led category (Ghobadian et al, 1994). Beside that, Crosby, (1980) who has defines a quality product as one that meets customer requirements. Quality has been defined in a way which includes both good and services as: The total of features and characteristics of a product or service that bear upon its ability to satisfy or implied needs. [ISO 8402 1986]- Vocabulary in Stebbing, (1990). Where the service element of a product is dominant, meeting customer requirement becomes a performance issue as well as an issue if conformity to measurable standards.

On another side, Gronroos (1984) found that “service quality” comprises of three global dimensions. The first dimension is the technical quality. This dimension refers to the outcome or what is delivered or what the customer gets the service. The next dimension is the functional quality which refers to the manner in which the service is delivered or how it is delivered, and the last is the corporate image. The store’s image is built by mainly both technical and functional quality and to some extent other factors like the traditional marketing activities.

Parasuraman, Zeithaml, and berry, (1985) described service quality as the ability of an organization to meet or exceed customer expectation. Sasser, Olsen and Wyckoff, (1978) listed seven service attributes which they believe adequately embrace the concept of service quality such as security (confidence as well as physical safety), consistency (receiving the same treatment for each transaction), attitude (politeness), completeness (the availability of ancillary services), condition (of facilities), availability (spatial and temporal customer access to services), and training (of service provides). . 2. 2 Research Done on Service Quality and Fast-Food Industry According to Kotler, Swee, Siew, and Chin (Marketing Management: Asian perspective, 2003), a service is any act or performance that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Nowadays, fast-food restaurant strive to survive in the forefront of marketplace by offering quality service. Since service is intangible, it is very difficult to measure the quality of service.

Beside that, Locobucci (1994) states that the service quality is imperative to marketers because a customer’s appraisal of service quality and the resulting level of satisfaction are thought to decide the possibility of repurchase and ultimately affect bottom-line measures of business success. Therefore, it is important for a fast-food restaurant to provide the best possible services to the customers because it will provide a good image for the customers and hence encourage customer for a second visit.

In addition, Zeithaml and Bitner (1996) stated that delivering higher quality service has been recognized as the most effective means of ensuring that a company’s offering stand out from a crowd of look-alike competitive offerings. To be able to stand tall in the food industry, delivering high quality food is important but to provide a good service is as important, if not more than providing high quality food. 2. 3. 1 Definition of Price Price can be define as what is given up in an exchange to acquire a good or service. Price means one thing to the consumers and another thing to the seller. To the consumer, price is the cost of something.

To the seller, price is revenue, the primary sources of profits. (McDaniel, Lamb, Hair, 2007). Price is the money or other considerations including goods and services exchanged for the ownership or use of good or service (Roger A. Kerin, Steven W. Hartley, Eric N. Berkowitz and William Rudelius, 2006). Pricing is one of the Four P’s from marketing mix which also consist product, promotion, and place. Pricing is also a key variable in microeconomic price allocation theory. The concept of price is central to microeconomics where it is one of the most important variables in resource allocation theory (also called price theory). McDaniel, Lamb, Hair, 2007). Thus, price is the only key element of the marketing mix that produces revenue; the others produce costs. Beside that, price also communicates to the market the company’s intended value positioning of its product or brand (Philip et al. , 2003) Howard & Sheth (1969) recognized that customer satisfaction is dependent on value. Value is the perceived level of product quality relative to the price paid or the “value for money” aspect of the customer experience. Value is also defined as the ratio of perceived quality related to price (Anderson, E. W. Fornell, C. and Lehrmann, D. R. 1994).

Moreover, value is expected to have a direct impact on satisfaction (Anderson & Sullivan, 1993; Fornell, 1992) and to be positively affected by perceived quality. Further research on this study, researcher found that price affect consumer purchasing behaviour (Rauf NiseI, 2001). Especially when consumers nowadays are more price conscious (price sensitive) on products offered in the market and will target only on value-for-money products that serve their needs better. This proves that the consumer will be more aware of what ‘value’ – the ratio of benefits to sacrifices (Zeithaml, 1998) (as cited in Sinha et a1. 2004). Even when the company produces the right product, promotes it correctly, and initiates the proper channel of distribution, the effort will fail if the product is not properly priced (Philip R. Cateora, John L. Graham, 2005). According to Susan Ward, “Firm can charge any price the firm want to, but for every product or service there’s a limit to how much the consumer is willing to pay. ” This shows that a company needs to take this consumer entry into account in implementing the pricing strategy in the sense that consumers must be willing to pay it. It requires the price of the roduct need to be consistent with the customer’s value toward the products. Rauf Nisel, 2001, also indicates that the motive of the consumer to buy or the determinant of the purchase decision will be “low price”. This shows that the price plays a crucial role in a consumer’s purchase decision. 2. 3. 2 Research Done on Price and Fast-Food Industry The finding of this study is comprehensive and it also proves that this study is useful for a company to set the right price. Setting the right price for a fast-food is fundamental for the reason that it may determine the company success or failure.

Researcher found that pricing is an important strategic issue because it is related to fast-food positioning (NetMBA Business Knowledge Center, 2002-2006). Hence, price is also related to marketing effectiveness (Zikmund & D’ Amico, 1993). Other than this, pricing affects other marketing mix elements such as fast-foods features, channel decisions and promotion. Even when the company produces the right foods, promotes it correctly, and initiates the proper channel of distribution, the effort will become fails if the product is not properly priced (Philip R.

Cateora, John L. Graham, 2005). Furthermore, a fast-food’s price must reflect the quality and the value the customer perceives in the fast-foods. In Anderson’s (1996) study, we also found that increase consumer satisfaction would lead to increase price tolerance, which means decreased price sensitivity. This indicates that consumers reflect better to price escalation when the level of satisfaction increased. But, before any pricing decisions can be undertaken it is important that the factors influencing price are understood.

A company cannot simply charge a higher price for their products or services if buyers know the market demand, prices, and the firm cost. Setting a right price is vital for a company profit. (http://www. ces. purdue. edulextmedialEClEC-722. pdf). 2. 4 Theoretical Conceptual Framework The figure 2. 1 indicated the research framework of this study. This research model is an overview of the relationship between independent and dependent variable. Figure 2. 1 (Independent Variables)(Dependent Variable) 2. 5 Hypothesis Development At this point, 3 hypotheses had been developed which based on the above research framework.

Hypothesis is an unproven proposition or supposition that uses to explain certain facts (Zikmund, 2003). The following are the hypotheses that were proposed in this research study. Hypothesis 1 H0: There is no significant relationship between product/food and UTAR student’s satisfaction H1: There is a significant relationship between product/food and UTAR student’s satisfaction Hypothesis 2 H0: There is no significant relationship between service and UTAR student’s satisfaction H1: There is a significant relationship between service and UTAR student’s satisfaction

Hypothesis 3 H0: There is no significant relationship between price and UTAR student’s satisfaction H1: There is a significant relationship between price and UTAR student’s satisfaction CHAPTER 3: RESEARCH METHODOLOGY Introduction This chapter was allocated to record the research methodology used in this research. Research methodology is defined as a body of methods, rules, and postulates employed by a discipline, a particular procedure, or the analysis of the principles or procedures of inquiry in a particular field according to Cooper and Schindler (2006).

This research was designed to assess the consumers’ perception toward McDonald’s, taken a sample of 30 respondents of students studying in Universiti Tunku Abdul Rahman (UTAR), located at Bandar Sungai Long, Selangor, Malaysia were surveyed by using a structured questionnaire. 3. 1 Primary Data Primary data is originally information collected for the first time, according to Kothari (1985). Moreover, according to Cooper and Schindler (2006), primary data are defined as data which are original works of research or raw data without interpretation or pronouncements that represent an official opinion or position.

Therefore, the primary data can be done through questionnaire, interview, observation, approaching organizations and further more. In this study, to obtain more accuracy, relevancy, expeditious, reliable and inexpensive data, a questionnaire was designed. Questionnaires are one of the methods to obtain specific information about how to define the problem according to Aaker et. al (1999). Questionnaire are more cheap, and do not require much effort from the researcher such as verbal or telephone surveys, and it often has standardized answers that are simple to compile data according to Questionnaire ( 2006).

According to Peter (1991), questionnaire is efficient and able to provide accurate information by providing sufficient time for respondents to look up information and reflect before responding. Furthermore, questionnaire method enables researcher to collect data in a short period of time due to the direct responses and feedback from the respondents. In our research, the questionnaire was distributed in term of self-administered. The questionnaire consists of two parts. Part A consists of questions that measure the demographic variables.

There are gender, which meal did you take at McDonald’s, how do you get to know McDonald’s, whom did you often go with, and how often you visit McDonald’s. In Part B, questions consists of three main factors which include product quality, price and service quality. Subsequently, the three main factors consists three sub-questions in each factors. This information is important for McDonald’s to know which factors will affect their customer satisfaction. The last part is testing the respondent’s satisfaction towards McDonald’s. 3. 2 Secondary Data According to Cooper and Schindler (2006), secondary data is interpretations of primary data.

In addition, according to Zikmund (2003), secondary data is the data that has been previously collected for some purposes other than the one at hands. It is usually historical in the nature gathered together and does not required access to respondents or subjects. Secondary data indicated the information that has gathered and recorded by others prior to the current needs of the researcher. Secondary Data is more economical, obtain rapidly and inexpensive than obtaining primary data. It is more time saving, higher relevancy, availability and accessibility where researchers can obtain data through the internet or library.

In order to obtain secondary data, researcher can obtain it from books, journals, dissertations, newspapers, sources from internet and so on. In line with our research topic, information regarding customer satisfaction, comment with fast-food industry such as McDonald, KFC and others had been generated from online journals, articles and past empirical studies that have been done by previous researchers which provided some applicable theories that could be useful to support this research project were found from UTAR library.

Besides that, Internet provides researcher with much information which are related. Searching information from the internet is more convenient, save time and cost efficient. For instance, the search engines which are frequently accessed are www. google. com and www. yahoo. com. In addition, http://library. utar. edu. my is the website which provides a lot of relevant journals and articles for review. For the research of the topic, the information about McDonald can be search through the website, www. mcdonalds. com. my. 3. 3 Data Analysis

Sampling is the process of using a small number of items or parts of larger population to make conclusions about the whole population (Zikmund, 2003). The purpose of sampling is to allow the researchers to estimate some unknown characteristic of the population. Besides that, according for Cooper and Schindler, 2006, the sampling technique that has been applied in this research is probability sampling which is based on the concept of random selection that means a controlled procedure that each population element is given a known non-zero chance of selection.

The survey population is UTAR students. All McDonald’s in Malaysia are selected in order to obtain optimal accuracy of the research analysis. A careful and precise selection of research sample is crucial in order to obtain high reliability of research data. Therefore, our target respondents focus on UTAR students. Reason of the sampling location was due to large scope potential of various target respondents demographic. Self-Administered-Questionnaire (SAQ) was distributed to 30 potential respondents at UTAR which can provide a better response rate.

After we studied all the questionnaires that have been returned to us, we have found that 28 questionnaires out of the 30 questionnaires satisfy the split-ballot technique question set by us to control respondent’s bias. According for William G. Zikmund, Split-ballot technique is a technique used to control for response bias. Two alternative phrasings of the same questions are utilized for respective halves of the sample to yield a more accurate total response than would be possible if only a single phrasing were utilized. 3. 4 Question Design A questionnaire is a self-administered statistical survey.

The questionnaire focuses on the UTAR student’s perception towards McDonald’s. The questionnaire includes 2 parts and consists of 17 questions. In part A, The questions required the respondents to fill in the demographic and personal profile of the respondents which consist of the gender, how often respondent visit McDonald’s, which meal did the respondent take at McDonald, how did respondent get to know about McDonald’s, and who did respondent normally go to McDonald’s with. In this section, respondents only have to tick the appropriate answer provided in the questionnaire.

In part B, it consists of three questions. The first question in this section was designed to test whether the existing level of product quality provided by McDonald’s restaurants will influence the return intention of the respondents. The second question is to test whether the existing level of service quality by McDonald’s and the last question is to test the level of price provided by McDonald’s restaurant. In this section, researchers will use five points like scale, which ranging from 1=strongly disagree to 5= strongly agree.

We have used the split–ballot technique in part B to control respondent’s bias, which are “I feel safe when eating McDonald’s food’ (positive) and other is “I seldom eat McDonald’s food because it can affect my health” (negative). The last part was asked about dependent and independent variable of our research. Dependent variable is a criterion or a variable that is to be predicted or explained. However, independent variable is a variable that is expected to influence the dependent variable, (William G. Zikmund, 2003), such as asking the respondents if they are satisfied with the price, product, and service of McDonald’s or not.

CHAPTER 4: DATA ANALYSIS AND INTERPRETATION At this stage, we will make a preliminary check for consistency. This involve editing and coding. 4. 1. 1 Respondent’s Gender Table 4. 1: Gender | |Frequency |Percent |Valid Percent |Cumulative Percent | |Valid |male |13 |46. 4 |46. 4 |46. 4 | | |female |15 |53. 6 |53. 6 |100. 0 | | |Total |28 |100. 0 |100. 0 | | [pic] Table and figure 4. represent the number of gender in the respondents. We have divided the respondents’ gender into two divisions, which are Male and Female. The highest number of respondent is female, which is 53. 57% (15 respondents). The remaining of 46. 43% (13 respondents) is male. 4. 1. 2 The Meal Respondents normally took at McDonald’s Table 4. 2: Normally, which meal did you take at McDonald’s? | |Frequency |Percent |Valid Percent |Cumulative Percent | |Valid |Lunch |14 |50. 0 |50. 0 |50. 0 | | |Dinner |7 |25. |25. 0 |75. 0 | | |Supper |3 |10. 7 |10. 7 |85. 7 | | |Other |4 |14. 3 |14. 3 |100. 0 | | |Total |28 |100. 0 |100. 0 | | [pic] Table and figure 4. 2 represent the respondents normally took which meal at McDonald’s. We have divided the respondent’s meal into 4 divisions, which are Lunch, Dinner, Supper, and Other. Most of the respondents took meals at McDonald’s at other times, which is 32. 8%. These respondents usually will take meals in McDonald whenever they feel hungry, no matter what time. This followed by 27. 59% of the respondents which take meal at McDonald’s during supper. However, 24. 14% of the respondents take meal during dinner. The remaining 16. 09% of the respondents take meal at McDonald’s during lunch. 4. 1. 3 How Respondents knew McDonald’s Table 4. 3: How did you get to know McDonald’s? | |Frequency |Percent |Valid Percent |Cumulative Percent | |Valid |Advertisement |23 |82. |82. 1 |82. 1 | | |Family |5 |17. 9 |17. 9 |100. 0 | | |Total |28 |100. 0 |100. 0 | | [pic] Table and figure 4. 3 represent how the respondents know McDonald’s. We have divided the ways of respondents knew McDonald’s into two divisions, which are Advertisement and Family. The highest percentage of the respondents is 82. 14% who knew McDonald’s from advertisement. The remaining of the 17. 6% of respondents knew McDonald’s from their families. 4. 1. 4 Who did Respondents go to McDonald’s with? Table 4. 4: Normally, whom did you go to McDonald’s with? | |Frequency |Percent |Valid Percent |Cumulative Percent | |Valid |Family |2 |7. 1 |7. 1 |7. 1 | | |Friend |24 |85. 7 |85. 7 |92. 9 | | |Other |2 |7. 1 |7. |100. 0 | | |Total |28 |100. 0 |100. 0 | | [pic] Table and figure 4. 4 represent who the respondents normally went to McDonald’s with. We have divided the respondents target into three divisions, which are Family, Friend, and Other. Most of the respondents go to McDonald’s with others, which captured 50%. These respondents normally go to McDonald’s with their boy friend or girl friend. This followed by 46. 43% of respondents which go to McDonald’s with friends. The remaining 3. 7% of respondents go to McDonald’s with family. 4. 1. 5 The Frequency of Respondents Visit McDonald’s Table 4. 5: How often did you visit McDonald’s? | |Frequency |Percent |Valid Percent |Cumulative Percent | |Valid |Once a week |10 |35. 7 |35. 7 |35. 7 | | |2-3 times a week |2 |7. 1 |7. 1 |42. 9 | | |Once a month |16 |57. |57. 1 |100. 0 | | |Total |28 |100. 0 |100. 0 | | [pic] Table and figure 4. 5 represent how often the respondents visit McDonald’s. We have divided the frequency of respondents visit McDonald’s into three divisions, which are once a week, 2-3 times a week, and once a month. The most times the respondents visit McDonald’s are once a month, which captured 57. 14%. However, the respondents who visit McDonald’s once a week captured 35. 1%. The remaining 7. 14% of the respondents visit McDonald’s 2-3 times a week. 4. 2 Hypotheses 4. 2. 1 Pearson Correlation Hypotheses 1: Product/food VS Satisfaction H0: There is no significant relationship between product/food and UTAR student’s satisfaction. H1: There is a significant relationship between product/food and UTAR student’s satisfaction. Correlations | | |AVGProduct |AVGSatisfaction | |AVGProduct/food |Pearson Correlation |1 |. 13 | | |Sig. (2-tailed) |. |. 946 | | |N |28 |28 | |AVGSatisfaction |Pearson Correlation |. 013 |1 | | |Sig. (2-tailed) |. 946 |. | | |N |28 |28 |

From the table (number), it showed that the relationship between product/food and UTAR student’s satisfaction. The p-value of the relationship between product/food and UTAR student’s satisfaction is achieved 0. 946. Since the p-value is higher than 0. 05 the probability level, thus this research study can accept null hypothesis and reject alternative hypothesis. Therefore, this research study can be concluded that there is no significant difference between product/food and UTAR student’s satisfaction. Hypotheses 2: Service VS Satisfaction H0: There is no significant relationship between service and UTAR student’s satisfaction.

H1: There is a significant relationship between service and UTAR student’s satisfaction. Correlations | | |AVGService |AVGSatisfaction | |AVGService |Pearson Correlation |1 |. 114 | | |Sig. (2-tailed) |. |. 564 | | |N |28 |28 | |AVGSatisfaction |Pearson Correlation |. 14 |1 | | |Sig. (2-tailed) |. 564 |. | | |N |28 |28 | The table (number) had shown the relationship between service and UTAR student’s satisfaction. The p-value of the relationship between service and UTAR student’s satisfaction is achieved 0. 564, which is higher than the probability level of 0. 05, so this research study can accept the null hypothesis and reject the alternative hypothesis.

Therefore, this research study can be concluded that there is no significant difference between service and UTAR student’s satisfaction. Hypotheses 3: Price VS Satisfaction H0: There is no significant relationship between price and UTAR student’s satisfaction H1: There is a significant relationship between price and UTAR student’s satisfaction Correlations | | |AVGPrice |AVGSatisfaction | |AVGPrice |Pearson Correlation |1 |-. 96 | | |Sig. (2-tailed) |. |. 317 | | |N |28 |28 | |AVGSatisfaction |Pearson Correlation |-. 196 |1 | | |Sig. (2-tailed) |. 317 |. | | |N |28 |28 |

Table (number) represents the relationship between price and UTAR student’s satisfaction. The p-value of the relationship between price and UTAR student’s satisfaction is achieved 0. 317. Since the p-value is higher than 0. 05 the probability level, thus this research study can accept the null hypothesis and reject the alternative hypothesis. Therefore, this research study can be concluded that there is no significant difference between price and UTAR student’s satisfaction. 4. 2. 2 ANOVA Hypotheses 4: The person who goes McDonald’s with UTAR’s students VS UTAR student’s satisfaction

H0: There is no significant relationship between the person who go McDonald’s with and UTAR student’s satisfaction H1: There is a significant relationship between the person who go McDonald’s with and UTAR student’s satisfaction ANOVA Average the person who goes to McDonald’s with UTAR’s students | |Sum of Squares |df |Mean Square |F |Sig. | |Between Groups |. 399 |2 |. 199 |. 589 |. 562 | |Within Groups |8. 58 |25 |. 338 | | | |Total |8. 857 |27 | | | | In the table, the p-value of 0. 562 is more than 0. 05. This showed that there is no significant difference in average the person who goes to McDonald’s with UTAR’s students between UTAR’s students satisfaction. Thus, we accept H0 and reject H1. As a result, we conclude the persons who go with UTAR’s students haven’t adopted UTAR’s satisfaction differently.

Hypotheses 5: The person who goes McDonald’s with UTAR’s students VS UTAR student’s satisfaction H0: There is no significant relationship between the meal u take at McDonald’s and UTAR student’s satisfaction H1: There is a significant relationship between the meal u take at McDonald’s and UTAR student’s satisfaction ANOVA Averages the meal u take at McDonald’s | |Sum of Squares |df |Mean Square |F |Sig. | |Between Groups |1. 155 |3 |. 385 |1. 199 |. 31 | |Within Groups |7. 702 |24 |. 321 | | | |Total |8. 857 |27 | | | | In the table, the p-value is 0. 331 which is more than the significant level of 0. 05. Since the p-value is higher than the significant value, we reject H1 and do not reject H0. In conclusion, there is no significant relationship between the meal u take at McDonald’s and UTAR student’s satisfaction, so we don’t refer to the tukey HSD diagram. . 2. 3 Independent T-Test Hypotheses 6: Gender VS UTAR’s student’s satisfaction H0: There is no significant difference in gender between the UTAR’s satisfaction. H1: There is a significant relationship between in gender between the UTAR’s satisfaction. | |Gender |N |Mean |Std. Deviation |Std. Error Mean| |AVGSatisfaction |male |13 |2. 54 |. 660 |. 183 | | |female |15 |2. 0 |. 507 |. 131 | | | |Levene’s Test |T-test for Equality of Means | | | |for Equality of | | | | |Variances | | | |F |Sig. |t |df |Sig. (2-tailed) |Mean Difference |Std.

Error Difference |95% Confidence Interval of the Difference | | | | | | | | | | |Lower |Upper | |AVGSatisfaction |Equal variances assumed |1. 800 |. 191 |-. 279 |26 |. 783 |-. 062 |. 221 |-. 515 |. 392 | | |Equal variances not assumed | | |-. 273 |22. 390 |. 787 |-. 062 |. 225 |-. 528 |. 405 | | Table shows the results of independent sample t-test performed on gender between UTAR’s students satisfaction. The mean for the mean students is 2. 54 and 2. 60 is for female students with standard deviation of 0. 660 and 0. 507 respectively. The t-value is -0. 729 and the p-value is 0. 83. Since the value of significance (2 – tailed) is more than 0. 05, we reject H1 and do not reject H0. Thus, we conclude that there is no significant difference in gender and UTAR’s satisfaction. CHAPTER 5: RecommendationS and conclusion 5. 1 Recommendations The respondents have given a negative impression to the all three variables of this research. It shows that product, service, and price does not contribute to the UTAR students’ satisfaction towards McDonald’s. Therefore, product, service, and price can not be critical factors that affect UTAR students’ satisfaction towards McDonald’s.

There are several recommendations that can be taken by McDonald’s to improve the UTAR students’ satisfaction towards McDonald’s. Product Since product can not affect the level of UTAR students’ satisfaction, it shows that McDonald’s does not need to focus on improving its products. Besides that, McDonald’s also do not need to invest a lot of money in its products in order to satisfy these customers. Therefore, McDonald’s should use the cost saved on something else such as, the promotion of its brand name in order to increase its brand awareness among its student customers.

Service Since service also can not affect the level of UTAR students’ satisfaction, thus, McDonald’s does not need to focus on improving its service, and McDonald’s should invest less money in customer service training for its employees. Hence, McDonald’s can focus on setting up more McDonald’s outlets at strategic locations such as locations where there are a lot of students to increase sales. Price As price is unable to affect the level of UTAR students’ satisfaction, hence, McDonald’s can still attract and retain its student customers whether the price is increase or decrease.

This might be due to the fact that McDonald’s has established a good position in the fast-food industry and among its student customers in Malaysia. Therefore, McDonald’s can maintain, increase, or reduce its price whenever it is deem needed depend on the price of raw material and other costs, or market segments. 5. 2 Limitation of this Research Study Although all the surveys have been successfully completed by us, but during the process of our research, we had faced with some limitations. Initially, we only distributed 30 copies of the questionnaires to 30 respondents to be filled up. It is due to the time constraint.

In that 30 questionnaires, we only found 28 questionnaires that satisfy the split-ballot technique question set by us. 28 questionnaires is a considerably small sample size of our respondents and it is one of the limitations of our survey. This can affect the results of the survey, and become more limited due to the small sample size. Besides that, when a respondent is filling the answers of the questionnaire, it might not be true answers. Thus, this will lead the results of the survey to become invalid. Some respondents will simply choose the answers without going through or understand the questionnaire carefully.

Another problem faced in the questionnaire part is the language barrier. The language barrier will cause the respondent to misunderstand the question. Thus, the results also will also be invalid. Lastly, our research only investigates the three factors (product/food quality, service quality, and price). We do not include other factors such as location, brand, monthly expenses, and other factors which may be important for this research. 5. 3 Conclusion The objective of this research is to investigate whether UTAR students are satisfied with McDonald’s product, service and price.

In this research, there are three factors such as food qualities, customer services, and pricing. According to the result, we have found that all of the three factors have no significant relationship with the UTAR students’ satisfaction towards McDonald’s. Since then, we have concluded that McDonald’s has become a common fast-food restaurant to UTAR students. McDonald’s in Malaysia was launch from December 1980 until now. Until today, McDonald’s still considered very popular in fast-food industry. This is because their food qualities, services and pricing are consider neutral in fast-food industry.

Besides that, McDonald’s do provide comfortable and good environment. Therefore, all the factors would not influence the UTAR student’s satisfaction towards McDonald’s. Although McDonald’s is facing many threats by its competitors, McDonald’s still able to achieve a good result and positive profit. Thus, we can say that, McDonald’s is a very successful organization in the fast-food industry and will continue growing in the future. ———————– Price UTAR student’s perception Service Product/Food 46. 43% 13 53. 57% 15 Gender Male Female Figure 4. 1: Gender Lunch Dinner Supper

Other 0 5 10 15 20 25 30 Cumulative Frequency 16. 09% 14 24. 14% 21 27. 59% 24 32. 18% 28 Figure 4. 2: Normally, which meal did you take at McDonald’s? How did you get to know McDonald’s? 82. 14% 23 17. 86% 5 Family Figure 4. 3: How did you get to know McDonald’s? Advertisement Family Friend Other 0 5 10 15 20 25 30 Cumulative Frequency 3. 57% 2 46. 43% 26 50. 0% 28 Figure 4. 4: Normally, whom did you go to McDonald’s with? 35. 71% 10 7. 14% 2 57. 14% 16 How often did you visit McDonald’s? Once a week 2-3 times a week Once a month Figure 4. 5: How often did you visit McDonald’s?

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