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McDonald's Corporation, established in 1955, owns one of the world's most well-known and valuable brands and holds a leading share in the global branded quick service restaurant segment. The Corporation has more than 30,000 restaurants in 119 countries serving 47 million customers each day.
McDonald's entered India in 1996 through joint ventures with two Indian entities, Hardcastle Restaurants Pvt. Ltd. and Connaught Plaza Restaurants Ltd .Hardcastle Restaurants Pvt. Ltd. owns and operates McDonald's restaurants in western India through a 50-50 joint venture with the parent company. Through a similar partnership, Connaught Plaza Restaurants Pvt. Ltd owns and operates McDonald's operations in northern India. There are 60 McDonald's restaurants in India employing over 2,000 people who serve more than 1.5 lakh customers across the country every day.
India challenges
? Indians do not consume beef and there is a significant population which is strictly vegetarian.
? Prior to McDonald's entering India there was no concept of such a food category. This meant low product awareness and absence of the infrastructure (cold chain) and supply chain needed for such a business to be successful. Indian agriculture was tuned to producing for households and not for the processed food industry.
? While all this necessitated high investments in infrastructure creation, the consumer could not afford to pay high prices.
? Availability of real estate is crucial for success in the retail business. Getting quality real estate was an issue. McDonald's either does outright purchase or enters into long lease of 25 years. Rent control laws, housing societies unwilling to enter into long term lease ...