Wanna get our awesome news?

Subscribe to our newsletter!


Actually we won’t spam you and keep your personal data secure

As the voice of the Indian restaurant industry, we represent the interests of 500000+ restaurants & an industry valued @ USD 4 billion. Whether a chain or independent restaurant, the NRAI is here to help every step of the way. Join us!


Wendy’s may try new India recipe to drive up sales


NEW DELHI: With slowing sales taking a toll, Wendy’s, the world’s third-largest burger chain after McDonald’s and Burger King, is reconsidering its operating model in India and may opt for a joint venture. This could mean moving away from its existing franchise model with Amtek Auto, two people familiar with the development said. It is exploring options to operate through a joint venture in India led by a food industry veteran, the people said.

An email sent to Wendy’s global spokesperson seeking comment on the matter remained unanswered till press time. Sanjay Chhabra, director at Sierra Nevada, the master franchise partner for Wendy’s India, denied the development. “Neither we nor the Wendy’s Corp, USA are on any such conversation,” Chhabra said in an email response.

Sierra Nevada Restaurants is an equal joint venture between London-based consumer brands company International Market Management and Carnation Hospitality, a company promoted by Amtek Auto.

Wendy’s started operations in India in May 2015 and currently has two stores in the country, both in the National Capital Region. It has already shut down the third outlet. “Expansion has been on the slow burn at Wendy’s and so far it has restricted its India presence only to Delhi NCR,” said an official closely involved with the company.

Challenges for the fast-food restaurant industry include steep rentals, multiple taxation, high attrition levels and a fragmented eating-out space. Rivals Burger King and McDonald’s have been playing the volumes game.

Burger King, which debuted in India in November 2014, about seven months before Wendy’s entered, notched up sales of Rs 141 crore in 2015-16, riding on affordable prices. Burger King has 70 stores in India.

“These are highly intensive operations and require heavy investments. Wendy’s is a huge global chain, but in India they don’t seem to be getting anywhere,” said Harminder Sahni of Wazir Advisors. “This is a time when burger wars now involve not just McDonald’s, but also deep-pocketed rivals like KFC, Burger King and Dunkin’ Donuts.”

The National Restaurant Association of India estimates the Rs 9,125 crore quick service restaurant market will grow to Rs 24,665 crore by 2021.

“The QSR space is highly competitive, which is why the need for innovation is crucial for continued success. Amidst intense competition, the slightest difference can have a lasting impact,” the association said in its Indian Food Services Report for 2016.

Wendy’s tied up with United Breweries and Grover Zampa last month to serve beer and wine at its DLF CyberHub outlet in Gurgaon. The other operating outlet is located in Noida.

The US chain, which has over 6,500 franchise and company-operated restaurants across 29 countries, posted net income of $48.9 million in the third quarter of 2016, compared with $7.6 million a year earlier, on revenue that fell to $364 million from $464.6 million.

Source: economic times

Recommended for you