This is in contrast to the earlier assessment that same-store sales for the two players would fall to low-single digits in July-September after the two players saw SSG sales growth decline sharply in the March and June quarters, respectively. But that may not be the case now. “There are a few factors that are working in favour of QSRs,” says Abneesh Roy, executive vice-president (research), institutional equities, Edelweiss.
“One is that the slowdown has been largely in rural areas. QSRs, on the other hand, are strong in urban areas. Secondly, these chains have worked hard in the past few years to improve reach, both online and offline, affordability via lower price points and value meals and through aggressive offers and launches. All this has helped during these tough times,” he says.
Amit Jatia, vice-chairman, Westlife Development, says the company is looking to add 25-30 McDonald’s stores this financial year as it seeks to achieve its Vision 2022 target of touching 400-500 restaurants. Westlife now runs 300 McDonald’s restaurants in 41 cities, and 197 McCafés within McDonald’s restaurants, a number that is likely to grow.
In this financial year, Jubilant FoodWorks is likely to add 90 Domino’s stores and 10 Hong’s Kitchen outlets, the new Chinese food restaurant that it began a few months ago. Pratik Pota, chief executive officer and whole-time director of Jubilant FoodWorks, says the response to Hong’s Kitchen is encouraging, prompting the firm to look at a larger footprint.
Besides adding new stores, both players have improved their digital presence, pushing their mobile apps and websites aggressively to capture new orders. Online deliveries today constitute 80-81 per cent of overall delivery sales, higher than the 60-65 number reported by the two players a year ago. “QSRs will have to go where consumers are. Convenience is a big factor in food retail, and players are acknowledging the trend. We have run multiple value campaigns on our app and that effort will continue,” says Jatia.
have also been quick to take advantage of most key events and occasions, launching special offers, combos, and discounts. Experts say the focus on innovative menu options is expected to stay as players’ work overtime to keep excitement levels going during challenging times.