After being present in India for over a decade, McDonald’s is chalking out ways to cut down on its logistics costs. The fast-food chain — growing annually at 30-33 per cent — is now looking at different regional suppliers, to minimise its supply chain costs by reducing transportation costs. Currently, a single supplier services its outlets. For instance, McDonald’s India sources its buns and liquid condiments from Ludhiana-based Mrs Bector Speciality Foods and shakes from Amrit Foods, Ghaziabad.
“We are looking at different suppliers for our outlets. Even though materials are sourced from far-off location for our various outlets, supply chain has to manage and ensure that the prices of food products remain uniform throughout India,” said Vikram Bakshi, JV partner and managing director, McDonald’s India (North and East). At the same time, the company will give its existing suppliers the option to expand and supply from newer geographical locations. For instance, Mrs Bector Speciality Foods opened its plant in Maharshtra to cater to its sourcing demands in the western region.
As non-availability of land and rising real estate costs are acting as a stumbling blocks in company’s expansion plans, McDonald’s is also mulling franchise outlets model. “We are putting our franchise plans in place. The first such McDonald’s franchise will come up in 2009,” said Bakshi.
Meanwhile, the company is pumping in Rs 300 crore to fuel its expansion plan in North and East India, hoping to double its revenues in the next two years and tripling the number of its food joints across northern and eastern India in next three-five years. Recently, it opened its first express counter at New Delhi domestic airport and will be exploring such opportunities at other airports and railway stations as well. It has already tied up with Bharat Petroleum and Hindustan Petroleum for its restaurants at their retail outlets. Currently it has 73 restaurants in North and East India.
Above news courtesy: Indian Express