The Strategist

India To Witness The Next Boost Of Fast Food Market In The Coming Years

04/07/2015 - 15:03

According to CNBC reports, India is going to be the next mega mart for fast food businesses in the coming decades. The said market boost is subject to the ability of American fast food producers to strategically improvise their menu to cater to the local customers.

India – 07 April 2015 – Vaishali Gauba reports to CNBC that the fast food business in India is becoming a major industry in the country. It was in 1996, when Indians were used to depend on the “tiffin boxes” for lunch, “hesitant to try fast food”, did McDonald boldly made an entry against the said backdrop.
Since then, almost decades have past, and at present the scenario is completely opposite. Furthermore, the Indian fast food market is even expected to increase in size from 2013 to 2016. In fact, as per “the Economist Intelligence Unit” the expected market value of this industry is to reach $1.12 Billion by 2016, while the demographic data hints that the “international fast food players” should invest in the Indian market as it going to prove the upcoming mega mart of fast food.
Interestingly, the size of Indian fast food market is ten times smaller than that of China according to the C.E.O. of Jubilant FoodWorks, Ajay Kaul. The company of Jubilant FoodWorks is a franchise that collaborates with the grant for foreign company products like Dunkin Donuts and Domino’s Pizza.
However, the Chinese market witnessed a decline the sale of fast food sometimes last year, whereas the correspondent Indian market is likely to grow in contrast. The result, according to the report, could be the “changing consumer preferences” which is dominated by the youth crowd being the largest in the world for Kaul says:
"I would think it's a revolution waiting to happen”.
Compared to the huge 1.2 Billion population of India, there are only 2,700 fast food chain outlets; as a result the market fails to reach most of the population, as informed by the “Euromonitor International”. Therefore, the potential market of fast food is “yet to broadly expand beyond the largest cities”.
In the vice chairman of “Westlife Development”, Amit Jatia’s words:
"The [quick-service restaurant] market is still very nascent, and there is ample space for more and more brands to come in and coexist".
The said company runs the western and southern Indian McDonald restaurant outlets. He also plans on open new branches of McDonald restaurant in the region which will on the whole add up to “175 to 250” in number. Jatia also adds:
"We have localized our menu and due to this, we are not just seen as an international brand, but one which the people of India feel comfortable with”.
On the other hand, KFC, another big name in Indian Fast food market, also gives a competition to McDonald due to its extensive chicken menu that clicks with the Indian taste. The chairman of Technopak, Arvind Singhal informs that “U.S. chains have "Indianized" their menus” which could give a partial explanation of “the rising appeal of fast food in India.”
In fact, Kaul also states that with strategic moves, localization “other than just customization” the” homegrown businesses” for which he holds Domino’s to be an exemplary one. It is only by overcoming the cultural resistance and arriving at a synthesis which caters to the local tastes at the same time maintains its international recognition can the American fast food joints establish themselves in India, says Kaul.