McDonald's to open McCafes to India

Project will take six months to complete.

US-based burger chain, McDonald’s, which made its debut in India 17 years ago, is putting together plans to bring its global coffee-house-styled food and drink chain 'McCafé' to get into the fast growing quick service restaurant (QSR) segment in India. The project will help McDonald's deliver better margins. However, sources from the company say, it will take at least six months for the project to roll out and the company is already scouting for appropriate locations. McDonald's subsidiaries in India — WestLife Development (WDL), a part of the Mumbai-based BL Jatia family, which spearheads the burger chain's operations in west and south India, along with Vikram Bakshi's Connaught Plaza Restaurants, which is responsible for expansion in the north and east India in a joint venture with McDonald's Corporation will soon offer a selection of coffees, desserts and smoothies, among others, to target the youth. Initially, these will be launched as a "shop-in-shop" model in some of the 250 existing restaurants. Through the new venture, McDonald's is looking to counter the likes of KFC, Domino's Pizza, Starbucks and Café Coffee Day, to whom it has been losing out as much as Rs 20,000 crore in the organised QSR space. The food service industry is one of the largest in India, estimated to be worth Rs 43,000 crore, of which the organised sector comprises 16-20%. The organised QSR business in India is estimated to be over Rs 20,000 crore, growing at a compounded annual growth rate of around 40%. The share of this segment is expected to double from 16-20% of the Indian food services industry to 45% by 2015, says a report by retail consultant Technopak.