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Home deliveries, takeaways to drive strong revenues post-lockdown: McDonalds India

Apart from promising a contactless experience, Westlife has implemented a 42-point checklist across dine-in, delivery and take-out to ensure highest standards of food safety and hygiene across all channels

twitter-logoAjita Shashidhar | June 12, 2020 | Updated 21:32 IST
Home deliveries, takeaways to drive strong revenues post-lockdown: McDonalds India

McDonald India's franchise partner (for West and South), Westlife Development's, Vice-Chairman, Amit Jatia, hopes that consumption sentiments should revive by October this year. Although the burger chain is getting ready to open its restaurants for dine-in, it expects a significant proportion of its revenues in the COVID-19-influenced new normal to come from its 264-unit strong Mcdelivery hubs and its partnership with food aggregators.

"The company is well positioned to capture the delivery market that is poised to explode in the post-COVID new normal," says Amit Jatia, Vice-Chairman, Westlife Development. With consumers increasingly shying away from stepping out due to the virus scare, the F&B industry at large is banking on takeaways and deliveries to steer its business going forward. Even five-star hotels have started home delivery.

Apart from promising a contactless experience, Westlife has implemented a 42-point checklist across dine-in, delivery and take-out to ensure highest standards of food safety and hygiene across all channels. It has also activated other convenience channels such as drive-thru and on-the-go pick up. Jatia expects McDonald's value positioning and the trust it enjoys in the minds of consumers as a safe and hygienic dining experience, to help it bounce back faster in the new normal. As offices open up, he expects people who are used to eating at local roadside eateries to start moving to organised eateries such as McDonalds.

Although the months of March, April and May have been a complete wash-out for the fast food major, just as it has been for most of its peers, Westlife Development has reported a robust annual revenue growth of 10.4 per cent with its PAT surging by 71.9 per cent. The company's annual revenue increased to Rs 1,547.76 crore with an annual same store sales growth (SSSG) of 4 per cent. Its cash profit for the year stood at Rs 134.06 crore, up by 23.6 per cent. The company's restaurant operating margins grew by 11.9 per cent YoY, while the annual operating EBITDA clocked a growth of 15.8 per cent to Rs 143.93 crores. "Despite losing business, we were able to grow by 10.4 per cent and that is because of our focus on cash conservation, fixed costs and supply chain efficiencies," claims Jatia. He says that the company had covered the entire profit it made in the earlier fiscal by December last year. "We had 18 consecutive quarters of robust SSSG until COVID hit us in the fourth quarter."

Jatia says that once the new normal sets in, the company would look at costs under a stricter lens. He says that cost conservation was an important agenda for the company even before the lockdown, and that is what helped in fast-tracking the growth for the company.

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