Question

The Skinner Years McDonald's shows a concern with over-expansion and the strain in can put on resources. After all, every investment choice comes with opportunity costs; how could we have better spent the money for both short and long term gains? Do you see how Amazon faces current similar options?

Answer 1

As we are aware that the way of doing business has changed to quite a lot and today organizations from the very onset aim to rise up and stay at the highest level of the industry and therefore they need to plan their strategies and investments carefully because a wrong investment choice will not only cost the organization in terms of finance but will also will give opportunity to the competitors of the organization. In this context McDonald's feel that they have over expanded and this is affecting their business to some extent as they are unable to create enough business that they have planned to create and they feel that they have invested the cost but they have been unable to benefit from the same as per their expectations. Instead McDonald feel that they could have used this money in other ventures which could have helped them in their business venture.

International expansion of a business is an important factor for organizations today but in order to be effective and yield fruitful results from this venture the planning of the strategy needs to be successful and to ensure that the organization should consider the following factors, like Economy of the nation, market trend of the country, policy towards foreign organizations, acceptance of a new product or service, etc. Amazon is also not an exception and I believe that even if Amazon has made some mistakes in selecting their business market then the number of mistakes are less compared to most of the organization and Amazon should come with plans and ideas to mitigate such issues.