Ronald's has been in the fast food business for five years.After struggling for two years, it finally broke even, and the french fries it offers are its most popular product.However, during the past year, its business has suffered because the farm that used to supply it with potatoes has increased its prices drastically.What should Ronald's do to control its production costs?

Question

Quizplus · Accepted Answer

By buying out the farm and becoming its own supplier, Ronald's will have more control over its potato supply and can avoid drastic price increases. However, this may require a significant investment and could come with its own set of challenges. Reorganizing the organizational hierarchy or opening more distribution outlets may not directly address the issue of rising production costs. Introducing a new product, such as potato nuggets, may not necessarily lower production costs either.

Ronald's Has Been in the Fast Food Business for Five