McDonald’s Shuts 41 Restaurants Due To Expired Licenses In Delhi—Fast Food Restaurant – Research Snipers

McDonald’s Shuts 41 Restaurants Due To Expired Licenses In Delhi—Fast Food Restaurant

McDonald’s India informed on Thursday that it has closed down 41 restaurants (temporarily) in Delhi due to their expired licenses, the company said it is a big blow to the brand like McDonald’s which has a strong growth rate in India.

McDonald’s has 55 of the total restaurants located in Delhi India out of which 41 have been shut temporarily. The restaurants haven’t renewed their licenses on time along with police registration in order to operate in public entertainment places.

Local media reports that there is an ongoing legal dispute between McDonald’s India and Connaught Plaza Restaurants Ltd. (CPRL). CPRL is an Indian fast food restaurant chain that owns and operates McDonald’s outlets in the capital.

McDonald’s said in a statement, “Eating house licenses of the number of restaurants in Delhi has been expired, due to this CPRL is suspending operations of some affected restaurants, the company did not provide any further details in this regard.

If the restaurants shut permanently for a longer period of time, around 1500 employees will lose their jobs, but McDonald’s ensured that the franchise will retain the employees and will pay the salary during the suspension period, according to AFP.

Fast food restaurant market has a huge potential and growth rate, $1.5 billion worth industry is booming at a 15% rate annually, said Technopak a consulting firm based in Delhi.

Saloni Nangia, president of Technopak informed that setting up and running restaurants in India is quite hard due to some legal restrictions, but the market has huge potential. The growing disposal income of the average Indian makes it more attractive to eat out.

The average number of licenses required to operate in India is up to 50—it even goes up if the company has to serve spirit in the restaurant, he added.

The most popular international fast-food chain McDonald’s facing intense competition from local competitors.

Indian Haldiram’s restaurant reportedly defeated McDonald’s and Domino’s Pizza in terms of revenues in India. Haldiram’s revenues were more than the combined revenues of McDonald’s and Domino’s.

McDonald’s faced quite a few issues operating in India, such as; a woman reportedly found a lizard in the fries she bought in March. Food safety standards are often overlooked in India, due to constraints in the supply chain and fewer resources.

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