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QSR Feature
Sourcing on a Global Scale
Creating an international supply chain.
Supply and distribution are crucial for quick-service brands expanding overseas.

Porridge was a must on the British breakfast menu. The Portuguese simply wanted soup, while the French fussed about saga, a blend of bleu and Brie cheeses, instead of that slice of American on hamburgers.

For quick-serves like McDonald’s, going global requires more than just introducing Big Macs and Quarter Pounders to Asia, the Middle East, Russia, and the 41 European countries where the Golden Arches operate.

It also means understanding and embracing the cultures and religions of the land, catering to regional tastes that go beyond cuisine and establishing a solid supply chain through localized food and beverage, purchasing, logistics, and distribution.

For McDonald’s, it’s a farm-to-fork supply initiative for offerings that run the gamut, says Heidi M. Barker, senior director of media relations. Its global suppliers need to provide everything from shrimp burgers in Japan, Halal-certified products in India to grilled chicken, or kofta (beef) McArabia sandwiches for the United Arab Emirates.

McDonald’s suppliers, no matter where they are located or what franchise they serve, must meet its global code of conduct.

That creed requires suppliers and associated contractors to conform to all applicable national and local legal requirements, customs, and published industry standards pertaining to employment, manufacturing, monitoring factories, and production facilities as well as the production facilities of their subcontractors used in the production of products for McDonald’s.

McDonald’s famous logo might always conjure images of fries and Big Macs, but each local customer base has unique tastes, which can be dictated by culture and religion and heavily influence the supply chain, Barker says.

“We’re not exporting products when we go to market,” she says. “We’re exporting people, policies, and best practices. We build from the ground up by hiring local men and women. They not only understand the culture—they are the culture. Knowing and understanding the heritage of the culture comes first. We build the business on that platform.”

Dairy Queen Delivers

Setting the stage for harmonious franchising with secure global supply chains is a methodical and delicate process.

“You have to take the time to understand the cultural differences,” says Jean Champagne, chief operating officer of the International Group for International Dairy Queen Inc., which plans to add 500 stores in China over the next five years. “You might have read things about a culture and you might believe it’s not true, but it is.”

Dairy Queen first set foot in China in 1990, and over the years, the company has built relationships with suppliers through its franchisees, which are well established in Asian marketplaces.

“A cold call to someone in China isn’t going to work, but if you meet through a mutual friend or associate, you will build a relationship a lot faster,” says Champagne, who is based in Burlington, Ontario. “It’s all about trust, and it’s part of their culture because they will not want to insult the friend who is introducing you to them.”

That approach worked particularly well for Dairy Queen when solidifying its supply chain, which provides essential dairy products, toppings, containers, and utensils. For example, one ice cream manufacturer in Beijing worked solely with a dairy farm in northern China, and through relationships company officials formed, they were able to leverage additional raw dairy material from that farm into the supply chain, which services Dairy Queen franchisees throughout Asia.

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