Exploring McDonald’s Supply Chain System: A Case Study Analysis

Background of McDonald’s

Question:

Discuss about the Perspectives In Purchasing Supply Chain Management.

The aim of this research is to explore the supply chain system of McDonalds to see how effective it is and use the application of theories to analyse if they can be used for determining the reasons of success of a supply chain considering the case of McDonalds. The case of McDonalds has been taken as the company is famous all over the world for its effective supply chain network. In this case, the McDonald Company’s supply chain systems would be explored using a secondary case study analysis and a primary interview data gathering and interpretation.

McDonald was initially started a drive in restaurant by two brothers including Maurice and Richard McDonald in US in 1937. During 1940s, the restaurant generated a business of $200,000 per year for them but with the introduction of self-service concept, the business saw a major boost and by mid 1950s, its revenues increased to $350,000 and franchisees started to appear showing interesting in using their brand and investing in return. However, as the company had too transparent business practices unlike the franchise system that was much complicated, the initial idea of franchise failed till Ray Kroc, a milkshake machines distributer signed a deal with McDonald brothers in 1954. Since then, the company has been appointing franchises and entered into some major agreements with malls and major companies like Disney with which the company got into a 10 year agreement of $1 billion , The had been expanding since then and by 2001, had 30,093 restaurants in its name with recorded sales of $36 billion. In the same time, the company owned 85% of the global fast food restaurants.

McDonald’s has nearly 36,899 franchised stores across 120 countries as per the data of 2016. These make 85% of the stores of the fast food chain while it also has 15% of its stores owned by McDonalds. In the franchisee arrangement, the land and building is owned or taken on a long term lease by the company while the franchise owner provides initial investment which includes expenditures on equipment’s, décor, seating, and signs.

This research would help identification of the best practices in supply chain based on which recommendations would be made for any retail organization such that these recommendations would help the organization attain efficiencies in their supply chains gaining the lessons from McDonald’s case.

Aim of this research is to explore the supply chain practice of McDonald to understand the causes behind their success. The objectives of this research include:

• Exploration of the supply chain systems of McDonalds
• Exploration of supply chain theories with their application to the case of McDonalds
• Interpretation of the case to come up with reasons contributing to the success of supply chain
• Coming up with the recommendations for the effective supply chain network in a food retail chain

The scope of this research includes the identification of methodology, conducting of interview with McDonald representatives, case study analysis of its supply chain, analysis based on integration of the insights from both type of data and application of supply chain theories for effectiveness testing, and recommendations for change management and application of supply chain best practices. The topics that would be covered in this research include introduction, methodology, findings, analysis and discussion, change area, conclusions and recommendations.

Objectives of the Research

Research methodology defines methods that are used for collecting and analysing data. Quantitative data involves measurement of data through the use of variables that are created to test a hypothesis for testing existing theories using statistical procedures. However, this data is not always sufficient to understand the perspectives, meanings and experiences. Thus, there can be a need for subjective assessment through the use of qualitative data.

Analysis of the qualitative data can help in understanding meanings, ideas, values, beliefs, experiences and other intangible elements in a research. A commonly taken approach to research is triangulation which involves creation of a backup for one method of data collection through another method. These methods can include survey questionnaire, or interviews. Interviews can be conducted using a fixed set of open questions that can get short answers to the questions covered. Use of open ended questions allow respondents to think deep about the ideas. The resulting responses can either be used to identify categories or report them through general statements.

Interview process involved formation of a set of open ended questions that were to be asked to the store manager. For testing the questions on their relevance, validity, and appropriateness, the questions were initially asked to fellow students who provided feedback for improvement on the basis of which the questions were refined.

Figure 1: McDonald’s Company Hierarchy

A sample of 5 employees of the organization from its Auckland store was taken based on the organizational structure of the organization at the restaurant level. The restaurant level executives working in the Auckland store included General Manager, Restaurant Manager, Assistant Managers, Floor Manager, Training Crew, Crew members, supporting staff, cleaners, servers, cooks, and bakers. In order to understand the supply chain of the company, the chosen 5 people included Restaurant Manager, Assistant Manager, Floor Manager, Crew Member, and Cook.

This research makes use of a mixed methodology of research in which a primary interview is conducted involving the 5 staff members and a secondary qualitative case study analysis is used for exploring the available data on McDonalds supply chain systems that is through exploration of secondary sources like books, journals, websites, and research reports.

Case Studies can be focused on testing a theory, building a theory or exploring the phenomenon through practice. In a case study where a theory is to be tested, theories are applied to a business situation and interpretations are made.  In this research, the same approach would be used for which the data collected from secondary resources including journals, research reports, books, and websites was analysed using case approach. As the aim of this research is to test the effectiveness and efficiency of the supply chain of McDonalds’s in Auckland, the case would involve exploration of the supply chain theories that would be applied to the case and explored to understand if they are relevant and could be used as a foundation for understanding the cause behind the success of supply chain systems of McDonalds.

A qualitative thematic analysis was used for the analysis of the interview responses that were obtained from the 5 staff members of the restaurant. Thematic analysis a very popular qualitative analysis method. The foundation for the thematic analysis for this research was built on the framework provide by Braun and Clarke (2006). They identify thematic analysis as a method that is used for identification, analysis a, reporting of certain themes or patterns reflected by the data. A thorough thematic analysis can provided an insightful data that can answer specific questions. The analysis facilitated exploration of the data from two perspectives that included data driven with inductive coding and research questions perspective. The themes were identified from the collected data that captured some key idea in support of the research questions. The data could reveal many themes but only the themes that were consistent with the research objectives and could be linked to a coordinated model of research were selected as final.

Scope of the Research

The identification of themes could be done in an inductive or deductive manner. Inductive method is a bottom up approach in which findings are obtained from dominant and significant patters that can be seen in the raw data such that a summary is then written for each of these major themes. Inductive approach to thematic analysis is used when the data has to be condensed, links have to be established between the data and research objectives, and a theory or model has to be developed from the understanding of experiences. A three stage procedure can be used for this involving transcription of data, coding of data, and development and revision of themes.

If the interview data is large in amount then there are certain software like NVivo and MXQDA that could be used. However, considering a small size of only 5 interviews, a manual process was used by the researcher. In this process, the transcriptions were written by the research on the Microsoft Word file and selected conceptual framework was used for identifying codes from this data. A data driven coding approach was taken to identify prominent patterns in the data and then its nodes and sub-nodes were also explored. Once these patterns and nodes were identified, they were coded into some key categories that were further refined with combinations or nesting to come up with final categories identified as themes. The final themes that would emerged from the analysis were the most referred categories in the data. In the last stage of thematic analysis, the developed themes were checked for their relevancy, usefulness, and limitations to arrive at these final themes (Jugder, 2016).

Case study methodology is a valid research study in a business research and can be very useful when a broad and highly complex subject needs to be explored and the context in which the research is done is very critical to the research subject. When case study is used for testing of theories, a four step process can be used involving development of questions for case exploration, selection of cases, collection of data for case and analysis of the case data using an appropriate method of investigation (Dul & Hak, 2013).

The data would be obtained from the secondary sources like books, journals, news reports, research reports, authentic company websites, and government sources. This data would be used to understand the supply chain system of the company as well as explore the challenges faced by the company and the strategies used by them to overcome these challenges (Yuen & Cheng, 2015).

A thematic analysis was done on the response data of five interviews and the identified themes include the following:

• Integration between suppliers
• Investment in supply chain
• Quality procurement
• Environment friendly packaging
• Close to market suppliers
• Customer centric business activities
• Innovative promotion
• Cost benefits due to volumes
• Accurate forecasting
• Contingency planning
• Distribution hubs
• Cost saving
• Profitability
• Inventory planning
• Communication flow

The McDonalds Company gains the revenues from owned store sales (63%), franchisee royalty (12%), franchisee rent, and fees (23%). With this revenue model, the success of the company as a whole is largely dependent on the performance and profitability of individual store. These stores incur high fixed costs with some variable costs and need strong gross margins to attain profitability. Fixed costs in the Auckland store include rent, franchisee feed, labour cost, property tax, licenses, fees, and debt service. Variable costs include raw material, operational supplies, labour cost variations, and royalties. As supply chain efficiencies can affect the variable costs largely and thus, can have significant impacts on the profit margins. Purchase of high margin products can bring in economies of scale and thus, increase the revenue of the organization. Introduction of new products like all day breakfast meals for youngsters can also affect the supply chain systems influencing their structures and costs. However, at the same time, it also increases sales (McCorkle, 2017). The alternatives have to be judged on the basis of costs that would be incurred and the additional sales that would be obtained through new introductions before a decision is taken for addition of new products in the restaurant (SHARMA, 2013).

Research Methodology

McDonald’s supply chain networks have to handle the needs of a large number of customers across nations for which the company uses a disintegrated approach. The stores work with independent suppliers and have good and close relationship with them. Individual company can focus on their stores and use their specific area of expertise. McDonald’s supply chain efficiencies are achieved with leverage on their supplier relationships. The supply chain of the organization has many independent suppliers that are individually handled by individual franchisee restaurants. At these stores, replenishment quantities needed are forecasted based on which suppliers are asked to produce materials and ship in volumes. Once an order for replenishment is place with the suppliers by the restaurant, the next step is to take care of the transportation from supplier to hub, distribution centre, till the restaurant. Replenishment quantities have to be staged appropriately for which an accurate demand forecast is needed. However, there can be a situation when the demand forecast is inaccurate in which case adjustments have to be made immediately (Dash, 2013).

Demand Uncertainty: To achieve speed to market, the supply chain needs to be adaptable and should accommodate fast to the need for increase in the volume. This increase puts pressure on the capacity constraints of the restaurant which has to be managed in advance before a new item or increased stock is accommodated in the restaurant. While suppliers would investment significantly on maintaining the supplies as per the demand forecast, the company personnel internally ensure that the demand forecasts are accurate. Underestimated demand can cause stock out situations which can upset customers and thus, affect the goodwill of the organization.

Constrained Capacity of Production: Manufacturing of hash brown is limited globally. North American suppliers of potato are responsible for the majority of supplies across the world. Thus, in the case of increase in demand, the limitation of the production capacity of suppliers can cause constraints. Thus, when the sales forecast is at high end in peak demand times, the restaurant would not be left with sufficient supplies.

Carrier Capacity Constraints: The demand for trucking is high in the Auckland market but the supply is short. These capacity constraints have to be considered at the time of planning and carrier capacity needs to be pre-negotiated failing which excess load would have to be transferred through the brokerage channel that can be costlier than the regular trucking supply arrangements.

Manufacturing constraints: Addition of new items on the menu such as in the case of ADB launch and Original English Muffin introductions, additional equipment’s are also needed such as cookers and toasters. Such initiatives are mostly taken on the pan country level and similar equipment’s have to be supplied that are procured at the same time to save on cots. This however, can be challenging because of the constraints in manufacturing capacity of these equipment’s and sufficient equipment’s may not be available on time.

Warehousing Requirements: When a large number of equipment’s are ordered at one go, they have to be stored in a warehouse where all shipments could be consolidated. The arrangement of the retirement space has to be made before the equipment’s are shipped from their production units. This depends on the availability of sufficiently sized warehouse which can be challenging as the warehouses may already be occupied.

Data Collection and Analysis

Shipping Constraints: Daily shipping capacities of shipping suppliers is limited such that when new products have to be launched, the capacity is found to be insufficient.

To overcome the challenges in supply chain systems at the McDonalds restaurant and for achieving efficiencies in the supply chain system, McDonald used certain strategies like:

• Created values that keep all the suppliers of the company together such that they work in coordination with their behaviour focused on the idea of ‘system first’ such that multiple suppliers prioritize the initiatives of the company
• Increased supply of eggs by 44%, capacity of cake producers by 25%, capacity of syrup production by 15%
• Contingency capacity planning for trucking such that McDonald services can be executed sufficiently even in the tight market
• Getting commitment from suppliers for a long term relationships that benefit both
• Sharing best practices between suppliers so as to get all of them the benefit of knowledge gained through experience of each other
• Capture the lessons learned from the supply chain practices and share it across the supply chain for mutual benefit
• Mobilize resources from multiple companies and make the share technological excellence and values so that they work together as an aligned team
• Invest in the supply chain integration systems that include Restaurant Order Proposal, Efficient Assured Supply, and One Shared View of inventory and demand in the supply chain
• Use of collaborative demand forecasting for inventory across nodes including supplier place, hub, and distribution point.
• Share risks with suppliers on equipment’s purchases and provision of supplementary services
• Provide weekly sales figures to all suppliers to let them adapt to supply needs as per demand.
• Align all areas of business including operations, marketing, technical, customer satisfaction, logistics, supply, and distribution
• Create a daily dynamic routing scheme to cover multiple shipping points
• Build a Supplier Quality Support team for survey of customer experiences and getting feedback for improvement of operations and employee training
• Identify potential bottlenecks in the supply chain and build contingency plans to deal with them
• Create a shared supplier base with coordinated global team working on supply needs
• Approve contingency suppliers to deal with emergency situations of capacity constraints with regular suppliers
• Arrange for contingency transportation carrier capacity to deal with high demand situations or weather related emergencies
• Make the organizational design flexible enough to cope with the needs of different suppliers.
• Provide rapid redesigning of supply strategies in response to the analytical insights obtained from the study of the impacts of the volume changes
• Follow a disciplined communication strategy so that good coordination is achieved even in the cases of complexities
• Use project management reporting to keep all supply chain leaders aligned and connected
• Establish a field supply chain network for alignment and management of communication between regional leaders, operators, and restaurants in the supply chain
• FSC to manage supplies, inventories, and daily reporting systems for critical items
• Putting best players on key supply chain roles who are committed, accountable and display leadership quality
• Create a sense of partnership among internal stakeholders, partners, and suppliers.

Analysis of the case study and interview response data can be done on the basis of some underlying theories that are normally used to explain the success of supply chain systems to see if the company is aligned with these theories and if the theories can be applied to the case. Theory of constraints is one such theory which suggests identification of supply chain system constraints, success factors, and relationships between these factors such that a system approach can be taken for supply chain management (NOWAKOWSKA-GRUNT & MOROZ, 2013). As found in the case study, the company explored the constraints of different components of the supply chain and accordingly made the contingency plans such as for production, carrier, and suppliers (Min, 2015).

As per the theory, there are some key decision elements in any supply chain and decisions have to be made on the level of integration needed in the supply chain, processes that need to be linked, and key members of the supply chain network. As was revealed in the case, each of these components of the supply chain were considered while developing supply chain management strategies in the company. The theory provides certain guidelines for taking strategic approach to supply chain management such as:

• Visualization of supply chain as a network of nodes and links between them can help identify each links and come up with ideas for improvement. At McDonald, an integrated approach is taken to get visibility into the entire value chain for which the company makes use of technology and project management tools
• Potential conflicts that can cause issues in system performance need to be identified and contingency plans to be made to deal with such situations. At the company, factors like logistics, procurement, transportation, and communication are studied and knowledge is shared between suppliers which can reduce the instances of conflict.
• In case of constraints, the cause behind them should be identified and plans must be made to deal with them through working on causes. McDonald identifies causes behind issues such as incorrect forecasting as a cause of stock outs. Based on these insights, company made contingency plans such as in this case, seeking a contingency supplier to quickly adapt to increasing demand in the market (Rowley & McMurtrey, 2016)

Broad themes that were identified from the interview responses can be explored further for analysis such that every theme has its descriptive or narrative explanation based on the theme:

• Integration between suppliers: McDonald has an integrated supply chain in which all the major suppliers and other partners including transporters and distributors are connected seamlessly such that they can coordinate in the supply chain treating it like a single system and work as a team to achieve a common goal of satisfying customers and gaining goodwill for all.
• Investment in supply chain: For integration and internal company processes, the company has invested huge in supply chain systems and project management systems. Moreover, in analytics, forecasting and survey of customers, company has done investment to understand changing market needs and respond with additional offers or new productions in the menu.
• Quality procurement: The raw material that company obtained is only from the certified suppliers and it event participates in programs that can help at the level of farming to get quality produce.
• Environment friendly packaging: The Company makes use of fibre which is environment friendly for all kinds of packaging in the restaurant such that the environment remains protected and no non-biodegradable waste is generated.
• Close to market suppliers: The company always takes suppliers for a specific restaurant from the local suppliers provided they follow the standards and provide the desired quality in the ingredients that would be used in the restaurant for preparation of food for serving. Nearby suppliers give them freedom to procure close to the level of consumption as well as save on the transportation costs.
• Customer centric business activities: All the activities and processes used in the company are customer centric such that the entire supply chain works in tandem to identify needs of the market and build strategies to fulfil them in least possible time. The company makes forecasting of products based on the customer requirement such that the restaurant never falls short of supplies of most selling items.
• Innovative promotion: The company makes use of innovative promotional strategies with customized offers which attracts more and more visitors and thus, the revenue is increased with the increase in the volume
• Cost benefits due to volumes: As the company sells in volumes and works seamlessly with supply chain partners, the coordination cost is less. Moreover, with faster delivery services, the company is able to serve more customers per hour which brings in efficiencies that convert into hourly cost benefits for the company.
• Accurate forecasting: the company makes forecasts of demands but also keeps a consideration of possibilities of forecasts going wrong due to market volatility and thus, also has contingency supplies and suppliers so that such situations can be easily adapted to and supplies can be managed fast without losing the goodwill in customers.
• Contingency planning: The Company makes use of contingency planning for supplies, suppliers, and transportation carriers such that if the original plan of the company does not work, the company can immediately adapt and take the contingency measure to handle situation and either eliminating or mitigating possible damage to the business of the company.
• Distribution hubs: The Company has hubs where the supplies or equipment’s are stored such that whenever they are needed at the store, they can be immediately transported. These hubs allows company to keep the storage for longer time and reduces the need to stock everything at the restaurant. It also helps in expansion plans when the company procures equipment’s in large amounts as these hubs can then been used as major warehouses for collecting all equipment at one place and from this place distribution to all stores can be carried out.
• Cost saving : Cost saving is achieved by the company in several ways such as by speedy delivery allowing more customers to be served in less time, efficiency of supply chain, reduced transportation costs due to local suppliers, increased negotiation capability with suppliers because of bulk purchases, and so on.
• Profitability: The profitability is achieved at the individual restaurant level in the company as these restaurants are given the freedom to operate separately as a different company and thus, they can manage the costs and profit dimensions as per their own regional conditions and needs.
• Inventory planning: Inventory is kept to minimum in the restaurant as only those items are stocked that are forecasted based on the market consumption.
• Communication flow: The company makes use of communication systems and strategies that not just makes the communication within company effective but also makes knowledge sharing and communication between suppliers and other supply chain partners such that they can coordinate better and work like a team

Considering the following thematic codes, it can be said that the company has some critical success factor that can be seen as the driving factors being the efficiencies obtained in the supply chain network of the organization and these include proximity to suppliers, supply chain integration, forecasting accuracy, cost effectiveness, and procurement efficiency.

Supply chain management theory suggests that a supply chain should be managed from end to end through integration and SCM thinking in every partner in the chain. The McDonald has an integrated supply chain in which all suppliers work together as a team and also share pieces of knowledge for a win situation for all. The entire supply chain of specific restaurant is integrated and work as one system.

Transaction Cost Economies is another concept in supply chain which suggests that the cost impacts is a major on the decisions that an organisation takes in a business. The company should always aim to mitigate the risks that can cause troubles to an organization which requires a company to have a risk management practice in place. In McDonald, risks are analysed and contingency plans are made separately for dealing with every component of the supply chain.

Social Network theory stresses on the importance of partners and the relationships between them and says that competitive advantage can be achieved if there is a strong relationships between the partners in the supply chain. With integrated supply chain competent and a knowledge sharing culture followed by McDonald suppliers, it can be said that the company uses practices that are aligned with this theory.

Case Study Analysis

Principle Agent Theory is another model that talks about identification of possibilities of conflicts and planning to resolve them through the use of governance and control mechanisms. With supply chain integration and monitoring, the company I able to achieve this in its supply chain.

Systems theory also talks about bring all the components of a supply chain together in an integrated manner such that the supply chain becomes a network of different types of resources. There is a large system under which every supply chain partner can be considered as a sub-system. With this approach, a holistic view of the system can be achieved such as done by McDonald that uses a system thinking in supply chain management through integration of suppliers, identification and allotment of leaders for managing supply chain components and sharing knowledge to again together as team.

Resource based view theory suggests that an organization in a supply chain should have consideration of the strengths, resources and capabilities of partners in the supply chain while taking important decisions. In McDonald, the capacity constraints of the suppliers are always taken into consideration and contingency plans are made accordingly. Moreover, the company also have an understanding of the production potential of each of its suppliers and thus, makes forecasting to predict demand and accordingly make the pre-bookings or place orders in advance so that the limitations or constraints create least impact on actual deliveries (NCBI, 2017).

However, there were some theories of supply chain management that could not be applied to the case because of the lack of evidence of the similar practice. These included strategic choice theory that states involvement of political forces in strategic issues, game theory that takes about conflicts between two decision makers (hicksand, et al., 2012).

If innovation has to be brought in a supply chain, lessons can be learnt from the case of McDonald and same can be applied as best practices to the companies in the industry. These practices can be evaluated based on certain criteria like process feasibility, acceptability, quality, cost, reversibility, and ethics.

Following strategies can bring in efficiencies in the supply chain network:

• Integration of different suppliers and supply chain components such that communication flow is fast and allow or knowledge sharing among suppliers

Feasibility: If the suppliers are also using the latest technologies and have aligned processes that can make it possible for the company to use an integrated approach then only this step may be taken. This needs all suppliers to have same or close level of business and IT maturity.

Acceptability: Suppliers who may not be familiar or comfortable with the integration because of their internal issues may not accept integration as it would demand a high level of transparency which can disclose their inefficiencies to other companies in the supply chain.

Quality: If the integration can be made possible between suppliers and other partners in a supply chain, it would enhance the quality of service with greater visibility and agility in the chain. Thus, it can be said that the quality of the supply chain would be enhanced.

Cost: Integration would definitely be a cost to all those accepting in the supply chain and thus, a willingness as well as profitability needs to be considered before taking a decision to integrate.

Thematic Analysis

Reversibility: Once integrated, it is no possible to go back to old methods without disturbing the balance of the supply chain.

Ethics: from the ethical point of view, an integration would bring in more visibility in to the system which would give the supply chain more credibility and convenience to customers which is ethically positive.

• Sharing of best practices, lessons learnt, experiences, and knowledge between different suppliers to enhance the knowledge and experience of all in the supply chain

Feasibility: Sharing information with each other would only need a strong coordination and a dedicated process of communication which can be made possible even with simple communication tools like social media, group chats, or community frameworks.

Acceptability: Sharing can be acceptable to most suppliers if it is a voluntary thing but is case it is made mandatory then some resistance may be faced.

Quality: Quality of service would improve with improvement in coordination if the communication is seamless with sharing of knowledge. This would also make all partners learn from each other such that they can improve the overall performance.

Cost: Cost to communication is not very high and thus, it can be implemented easily.

Reversibility: Sharing of information can easily be stopped between partners if the strategy is not working.

Ethics: from the ethical point of view, sharing of knowledge would make coordination better and thus, enhance the quality of service helping company serve its customers better and faster which is more ethical

• A communication system must be established between the supply chain partners such that the entire chain works seamlessly as a team that communicates frequently

Feasibility: regular Communication with each other would need a strong system to be built and an understanding of roles and responsibilities which is possible and feasible with sharing of information between the chain partners.

Acceptability: regular and seamless communication can be acceptable to people interesting in improving the supply chain but there can be some people resisting to the solution

Quality: Quality of service would improve with improvement in coordination if the communication is seamless with sharing of knowledge. This would also make all partners learn from each other such that they can improve the overall performance.

Cost: Cost to communication is not very high and thus, it can be implemented easily.

Reversibility: Communication processes only need to be set but if they do not work, companies can always revert back to old processes so it is a reversible solution

Ethics: from the ethical point of view, coordination would enhance productivity of employees of various organizations in the supply chain which is positive.

The aim of the research was to explore the supply chain system of McDonald which is known for having an effective supply chain network so that lessons can be learnt and applied in practice. For this the research use both primary and secondary sources for data collection and a combination of thematic analysis and case study analysis for the interpretation of the data obtained. The primary research involved collection of data from 5 interview respondents and secondary data collection involved collection of case details on supply chain practices of McDonalds. For analysing the responses of the interviews Thematic analysis was used for effective categorization of the qualitative interview data and it was driven by the objectives of the research. The research also involved exploration of the case with application of some of the supply chain theories such as theory of constraints, supply chain management theory, transaction cost economies, network perspective, and principle agent theory. All these theories were explored to understand if the practice of McDonald are aligned with these and it was found that the company is actually using practices that are aligned with the guidance provided in these theories for achieving an effective supply chain. From the thematic analysis, certain critical success factors behind the success of the supply chain of the company were identified as proximity to suppliers, supply chain integration, forecasting accuracy, cost effectiveness, and procurement efficiency.

Based on the study conducted, certain recommendations can be made for retail organizations to achieve efficiencies in a food supply chain such as:

• Giving customer needs highest priority at every level of the supply chain such that at every stage of the supply chain an appropriate value is created for the customer. For this, a company can analyse the use and need of customers at every stage in the supply chain and find out the best possible servicing solution that would add value to the customer. For instance, at the level of order processing, a customer may need an update which can be sent through an SMS informing customer about the status of the order.
• Identification of constraints and limitations as well as risks of all kinds’ and building contingency plans for tackling or resolving the issues. An organization can face several risks in operations such as delays in supplies, delivery of stale products, unavailability of demanded goods, supplier price increases, and so on. All these risks can be analysed and contingency plans can be made on how they can be tackled by the company.
• Create contingencies for suppliers, materials, and transportation carriers to deal with peak season demands of restaurant. A strong forecasting is needed to assess the demand but in case they still fail to predict actual demand, the contingencies can be used for covering up the needs. For instance, if a regular supplier does not have demanded material, a backup supplier may be used. In a similar manner, a backup transportation service provider may be used if the regular transporter fails to deliver service for some reason.
• Choose best people and put them in leadership positions so that they can guide the entire supply chain network to attain efficiency. People working for various organizations can be assessed on their potential such that when they are found most suited for handling a more responsible level of position, they can be trained and put into that to bring improvements in the supply chain.

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