Question

Use the cage framework for the analysis of a country's foreign enterprises choose to enter.How about McDonald in China?About 250words.

Answer 1

The CAGE Distance Framework identifies Cultural, Administrative, Geographic and Economic differences or distances between countries that companies should address when crafting international strategies. It might likewise be utilized to comprehend examples of exchange, capital, data, and individual’s streams. The system was created by Panda Ghemawat, an educator at the University of Navarra - IESE Business School in Barcelona, Spain. The impacts of CAGE distances and differences have been demonstrated quantitatively via gravity models. Such models "resemble Newton's law of gravitation in linking interactions between countries to the product of their sizes (usually their gross domestic products) divided by some composite measure of distance.

McDonald’s is focusing on the fast-growing number of Chinese urban motorists as it continues its rapid mainland expansion, with plans to open several hundred new restaurants, most of them drive-through, over the next few years. The world's biggest junk food chain on Tuesday reported an organization with Sinopec, the state-possessed oil monster that works oil benefit stations crosswise over China that will quickly quicken this system. The organization has 760 eateries in China, around 2.5 percent of its reality aggregate, and hopes to extend its essence to 1,000 stores by the 2008 Olympic Games, a development rate of around 100 stores per year that is probably going to be kept up for quite a while, officials said. Currently, only three of McDonald’s restaurants in China are drive-through, but the executives said more than half of the new stores opening in the near term would accommodate purchases from cars. The move to definitely expand its number of drive-through in China is an indication that dietary patterns in vigorously populated urban areas are ending up more Americanized, in large part due to widespread car ownership and more mobile lifestyles, particularly among the younger generation. “The potential is enormous,” said Jeffrey Schwartz, chief executive officer of McDonald’s China. He said the alliance with Sinopec, which has some 30,000 petrol stations around China and adds around another 500 every year, would become a “powerful platform” for McDonald’s to build its business. For McDonald's, which entered the China showcase in 1990 in Shenzhen, future achievement in the nation will depend generally on whether it can discover new areas that have sufficient discretionary cash flow, alongside enduring person on foot and vehicle movement. McDonald’s employees have been carefully evaluating possible new store sites in proven and emerging Chinese cities. Locations where drive-troughs will be set up include Beijing, Shanghai, Guangzhou and Shenzhen, as well as the interior cities of Wuhan and Chengdu. Executives did not detail exact targets for the number of new drive-troughs or overall store transaction rates. Drive-through in Asia is not nearly as widespread as in the US. But they are already present in some developed Asian economies; McDonald's has in excess of 1,000 generally speaking in Japan, Malaysia, Singapore and Taiwan. Mr. Schwartz says the three McDonald's drive-through in territory China – in the Pudding region of Shanghai and the Guangdong urban areas of Don guan and Fushun – have performed shockingly well in their first half-year of business13, evidence of the “pent-up demand” that exists for fast-food services. By a large margin, McDonald’s in China still trails Yum Brands, which owns KFC and Pizza Hut. There are now more than 1,600 KFCs and 200 Pizza Huts in hundreds of cities in the country. China is now KFC’s top overseas market. Several other much smaller fast-food chains are looking to expand into China, including Jollibee of the Philippines and Burger King, which has plans for several stores in Shanghai this year.