Value Chain of Fast-Food Industry

Value Chain

For fast-food chain industry, there is a typical value chain and some variations between Maxim’s MX, Fairwood, and Café De Coral.

Primary activities

Inbound Logistics

The fast-food chain industry uses a centralized warehouse to receive and store all the ingredients and food, then distribute a suitable amount of raw materials to different branches. Centralized warehouse helps firms distribute and utilize the storage space better at a cheaper rent location (cost advantage), and it increase consistency of products.

This industry uses regulated daily transportation schedules to redistribute raw materials, such as ingredients, food and tableware to different restaurants on a daily basis to avoid shortage and wastage of supplies of individual restaurants. Transportation costs are saved by using centralized warehouse (cost advantage).

Besides, inventory checking computer system is employed to notify replenishment of individual ingredients and raw materials in different restaurants.

Operation

The fast-food chain industry has a standard food processing system. Most of the materials in branches are semi-finished food, which are prepared in the centralized warehouses or food processing plant. This can help restaurants to standardize their products and maintain a stable quality of their food.

The Industry practices the 5S methodology to facilitate its operation. The 5S methodology is Structure, Systematize, Sanitize, Standardize, and Self-discipline. This methodology increases operation efficiency and thus increases sales.

Fast food restaurants practice self-service operation system, i.e. customers order food and pick up food themselves. This helps to save a lot of manpower and thus reduce operation costs.

Three enterprises provide long operation hours, like 7am to 9 pm to facilitate different customers demand.

Marketing and sales

The industry gets use of different types of advertisement, such as television, radio, newspaper and...