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First of all, I would like to express my deepest gratitude to my supervisor for his excellent
supervision and guidance, great support and serving useful comments throughout the process
of my dissertation research. His wisdom and knowledge to the outmost standards had a
positive reflect in the completion of my work.
I would like to thank my Father, Mother, Brother and Sister for their constant care and
support. If it wasn’t for their encouragement, I would not have been able to complete my
research in such a limited time frame.
I thank all my respondents who had the patience to fill up my questionnaire and aid me with
all necessary information that helped me analyse my research data.
Last but not least, I thank the Almighty God for his blessings and support throughout the
course and helping me overcome all dangers and sufferings to have completed this piece of
research in full.
Purpose: This research work is driven with the purpose of critically evaluating and assessing the
business growth opportunities for McDonalds while entering the Indian market.
Aims and Objectives: This research work aims at serving four major objectives including the critical
analysis of the competitive scenario of the Indian fast food industry. Secondly, to understand the
consumer behavior in the Indian fast food industry and their purchasing traits. Thirdly to discover the
growth prospects available to fast food retailers in India with a particular focus on McDonalds. Lastly,
to make recommendations to McDonalds for targeting the business growth opportunities in Indian
market
Research Methodology: The research is a qualitative study and makes use of both sources of data
primary and secondary. It collects primary data with the help of managers from the different outlest of
McDonalds in India and secondary data from different academic sources.
Data Analysis and Discussion: The primary responses of the participants have been analysed and
discussed in this section. In addition, theoretical discussion has also been made in order to help the
company to recognise the opportunities and challenges in the Indian market in order to grow.
Conclusion and Recommendations: The findings of present research state that the in order to grow
in the Indian fast food market, it is essential for McDonalds to consider the different factors, which
affects its growth. It has been analysed that the consumers are inclining more towards fast food and the
market is growing, but it is full of challenges, which the company has to address for the purpose of
conquering the market, in an effective manner.
Key Words: McDonalds, Fast Food, Nutrition, Health, Multinational, Retailers, Opportunities.
Purpose: This research work is driven with the purpose of critically evaluating and assessing the
business growth opportunities for McDonalds while entering the Indian market.
Aims and Objectives: This research work aims at serving four major objectives including the critical
analysis of the competitive scenario of the Indian fast food industry. Secondly, to understand the
consumer behavior in the Indian fast food industry and their purchasing traits. Thirdly to discover the
growth prospects available to fast food retailers in India with a particular focus on McDonalds. Lastly,
to make recommendations to McDonalds for targeting the business growth opportunities in Indian
market
Research Methodology:
The research is a qualitative study and makes use of both sources of data
primary and secondary. It collects primary data with the help of managers from the different outlest of
McDonalds in India and secondary data from different academic sources.
Data Analysis and Discussion:
The primary responses of the participants have been analysed and
discussed in this section. In addition, theoretical discussion has also been made in order to help the
company to recognise the opportunities and challenges in the Indian market in order to grow.
Conclusion and Recommendations:
The findings of present research state that the in order to grow
in the Indian fast food market, it is essential for McDonalds to consider the different factors, which
affects its growth. It has been analysed that the consumers are inclining more towards fast food and the
market is growing, but it is full of challenges, which the company has to address for the purpose of
conquering the market, in an effective manner.
Key Words: McDonalds, Fast Food, Nutrition, Health, Multinational, Retailers, Opportunities
Chapter 1: Introduction
1.1 Background
1.2 Problem statement
1.3 Significance of the Problem
1.4 Rationale
1.5 Research Aim
1.6 Research Objectives
1.7 Research Questions
Chapter 2: Literature Review
2.1 Introduction
2.2 Conceptual Framework
2.3 Overview of the Indian Market
2.4 Overview of the Indian Fast Food Sector
2.5 McDonalds in India
2.6 Consumer Behaviour in the Indian Fast Food Industry and their Purchasing Traits
2.7 Business Growth Prospects in India for McDonalds
2.8 Challenges for McDonalds in the Indian Market
2.9 Conclusion
Chapter 3: Research Methodology
3.1 Introduction
3.2 Research Philosophy
3.3 Research Approach
3.4 Research Design
3.5 Data Collection Methods
3.6 Sampling Methods
3.7 Ethical Considerations
3.8 Limitations
3.9 Summary
Chapter 4: Data Analysis
4.1 Introduction
4.2 Analysis of Close Ended Interview Responses
4.2.1 Frequency of Fast Food Consumption in India
4.2.2 Reasons due to which Consumers in India Prefer Eating Fast Food
4.2.3 Reasons due to which Consumers Prefer Eating at McDonald’s Restaurant
4.2.4 Performance of McDonalds in India
4.3 Analysis of Open Ended Responses
4.3.1 Perceptions Regarding the Growth of Indian Fast Food Industry
4.3.2 Future of the Indian Fast Food Industry
4.3.3Changes to Further Improve the Performance of McDonalds in the Indian market
4.3.4 Challenges which McDonalds has to Address for Growing in the Indian Market
4.4 Findings
4.5 Summary
Chapter 5: Conclusion and Recommendations
5.1 Conclusion
5.2 Recommendations
References
Appendix
It is noteworthy that when western fast-food chain, like Domino’s Pizza, McDonald’s,
and KFC at first unlocked their doors in India in the middle of 1990s, they made huge efforts
to struggle with the spicy Indian street food and the complex home-cooked meals, which
Indian mothers use to prepare for their families (Pradhan, 2009). However, the more chaotic
schedules of people, expanding incomes along with demographic actualities, approximately
60 per cent of Indian populace is below 30 years and have develop novel appetites among
Indian customers. Fast food retailers in India have undoubtedly witnesses a growing trend,
considering that they faced tough competition from Indian rivals (Kazmin, 2011). On the
contrary, Anand (2013) has claimed that consumers have been reducing down on
discretionary expenditures not only in food sector, but also in dissimilar sectors, for instance
consumer durables, auto, personal care and so on.
In addition, consumers in India have also started to show an inclination towards
healthy eating due to which fast food retailers are also finding it difficult to woo customers.
In this regard, it has become essential for fast food retailers to seek for novel business
opportunities in order to grow and develop in the Indian market and also to attract customers
by acknowledging their behaviour (Jacquelline and Kline, 2007). With respect to this, this
research is mainly emphasised on evaluating the business growth opportunities Indian market
present to fast food retailers. This research will mainly concentrate on McDonalds, which is
not only one of the fundamental fast food giant in the world, but also a key player in the
Indian market possessing a considerable market share.
In light of the above discussion, it is clear that the fast food sector of India is vivid and full of business prospects, but it is intensely competitive too due to a lot companies targeting it and trying to conquer it (Cohn, 2008). Therefore, they key problem lying in front of companies is to tap the appropriate business oppountnies while entering the Indian market so that they grow in terms of profit and sales and do end up with a decline (Harris, 2009). With respect to this, the problem addressed in this research is to find out the relevant business expansion prospects for McDonalds while entering the Indian market.
This problem is significant considering the fact that the central aim of any fast food retailer is to generate value for money for its customers and for this it is necessary to tap the right business oppountnies that allow a retailer to grow and satisfy customers. Vijayabaskar and Sundaram (2012)have asserted that increasing customer relationship can offer an edge to fastfood retailers in India provided they are capable of adopting relevant opportunities and managing them with key practices to facilitate higher customer satisfaction and improved overall experience. Thus, the problem statement of this research is significant because the researcher will concentrate on analyzing the business growth opportunities in context to the Indian fast food sector and also evaluate the relative core competencies and abilities of one of the major industry player, McDonalds to embrace novel course of actions for growing successfully (Emerson, 1994). This study will also deal with assessing the consumer behaviour in India and their purchasing traits in the direction of fast food industry. This research is significant as it will also determine the factors that could persuade the buying behaviour of consumers and could be further used for business growth by the fast food retailer.
The fast food sector of India has observed an extensive enlargement and expansion in
the past few years as the number of local retailers made their existence in a variety of
locations in the country. Moreover, the simplicity of market entry has also enabled foreign
companies to enlarge their operations areas in India. In the viewpoint of Prabhavathi, Kishore
and Kumar (2014) the perception of customers, satisfaction, tastes and preferences extend
more positive consumer behaviour toa specific brand in comparison to any other factors.
Kashyap, Kashyap and Sarda (2013) has make it clear that Indian populace have
radicallyaltered their behaviour towards fast food and now they are ready to expend more on
fast food in comparison to any otherconventional or custom food product.
Although, a number of researchers have presented information regarding the growing
Indian fast food sector, but no one have actually the business growth opportunities it present
to foreign companies targeting Indian market. In this regard, the chief rationale of this
research is to assess the Indian fast food sector in an in-depth manner, and bring out the
analysis of business growth opportunities companies have while entering the Indian market,
with a special focus on McDonalds.
After discussing the problem assertion and the rationale of this study, it is necessary to determine the chief aim of this research which will be met with the help of an in-depth investigation and data collection. In this context, the aim of this research study, which the researcher will try to accomplish throughout the research, is to critically evaluate and assess the business growth opportunities for McDonalds while entering the Indian market.
The aim of this research has been listed below:
On the basis of the research objective, the main research questions that will be investigated during the course of this research is, “What business growth opportunities are available to McDonalds in entering the Indian market?” Apart from this, the following sub questions will also be examined:
The literature review chapter of the study is focussed on finding out the outlooks and
claims made by a diverse researchers, and authors in their research on business growth
opportunities while entering the Indian market. This chapter will show information related to
the business growth opportunities in entering the Indian market. This way, the research goals
of the dissertation will be handled considerably by examining the dissimilar literary
foundation on business growth opportunities in the Indian market and its relevance for
McDonalds to grow further.
This section has been produced on the basis of below presented conceptual framework:
In the viewpoint of Egan and Ovanessoff (2011), over the coming five years,
emerging markets like India will account for much of the world’s economic growth. It is
noteworthy that emerging markets are mounting quickly as a share of international GDP. As
per authors, between 2010 and 2015, international economic output is expected to escalate by
$8.5 trillion and emerging economies are anticipated to hold approximately 62% of this
growth as mentioned in the figure below:
Thus, India as an emerging market is not only rising faster than some of the developed
markets; but it is also all ready to contribute a larger share to the complete expansion of the
international economy than developed economies will. For instance, India will contribute
more expansion in this period as compared either to Japan, Germany, the United Kingdom,
Canada or France. As per a report of Deloitte (2013), India is anticipated to be the globe’s
third biggest middle consumer market by the year 2030 with ambitions for technology-
intensive and sophisticated and products and services, with an approximate consumer expend
of around US$ 13 trillion.
It is considerable that with the rise in income levels of the middle classes in India, the
increase of the Indian consumer is pushing higher aspirations, the requirement for
international level infrastructure, superior quality healthcare, brand top consumer products
and classy public and private services. The extraordinary development of the novel middle
class exterior to the western economy will perhaps the most dominant economic trend in the
coming years (Charlene, 1997). This transformation will portent a golden period for several
economies, as the core of world power moves from west to east and markets like India and
China grow their likelihood as economic powerhouses in the coming decades. The outburst of
middle class customers started to take shape in the Indian economy at the 90s, subsequently
trade liberalisation after 1991, an escalation in FDI (foreign direct investment) and the
explosion of information technology exports (Deloitte, 2013). Growing average income ranks
of the middle class people in India are leading towards inspirational consumer behaviour, as
consumers look for superior quality products and services (NPCS Team, 2014). Therefore, it
is clear that the country presents vital growth opportunities to companies in different sectors
who are planning to enter the Indian market or have already entered it.
Figure 3: Spending by the Global Middle Class, 2009-2030
(Source: Deloitte, 2013)
Fast food sector is the foremost and one fastest expanding sectors in food industry in
the world. Fast food includes all food items that can be prepared and served in an extremely
quick manner. Therefore, due to the commercial focus on swiftness, uniformity and low cost,
fast food products are a lot made with ingredients put together to attain a definite flavour or
consistency and to safeguard freshness (Rößiger, 2008).The surfacing of the fast food sector
has, altered metropolitan food culture in India to a considerable level. Fast food culture
emerged in the country post independence as before that eating at home used to be a pertinent
facet of Indian culture. Nevertheless, over a period of time, and with the escalation in the
figure of nuclear families, economic development and rising per capita income, and at the
same time globalization, fast food culture earned eminence in India (Prabhavathi, Kishore,
Kumar, 2014).
Correspondingly, children also choose to fast food due because it exposes them to
international urban way of life and western food which enhanced their longing for cheap and
delectable fast food. In addition to this, fast food is cost effective as compared to
conventional meals in India starting with appetizer and ending with dessert. With
liberalization of the Indian economy in the year 1992, novel multinational fast-food
companies quickly targeted the country as a massive prospective market with their channels.
Pizza Hut, Burger King, Domino’s Pizza, KFC and McDonald’s outlets are running in
shopping malls and other communal areas in India. Altering consumer behaviour and positive
demographics derive India to observe an incredible development in the fast-food restaurant
sector (Kashyap, Kashyap and Sarda, 2013). The chief players of fast food in the India
market are:
Figure 4: Chief Players of Fast Food in the India:
Similarly, in the viewpoint of Vijayabaskar and Sundaram (2012), the Indian fast food behaviours and the consumers discernment towards fast food has observed steady change in the current years as the momentous segment of the populace expend more money on consuming fast food from the local and international outlets in the market. The industry was once overlooked and merely had any subsistence in the hospitality and food sector, however the current findings proposed that there is enormous probability in the industry as the expansion rate was observed more than 30% in the current years.
McDonalds opened up in India for the first time in the year 1996, a country with
major population being Hindu and vegetarian. A lot of people considered it as another
instance of the inexorable expansion of Western corporations into every country, generating
an international mechanism in which prosperity was worn out of domestic nations into the
hands of a little, and rich leaders. McDonald’s initiated its business in India in order to
exhibit what the McDonald’s experience is all about (Kulkarn and Lassar, 2009).
The company entered in the Indian market at the perfect time as the country was
opening up to foreign companies and the economy was also becoming stronger. McDonald's
had been a triumphant international food company at humanizing, co-organising regulating
and constructing processes into a complete arrangement. The customer markets were also
enthusiastic to obtain newer offerings and utilise newer types of services and at that time
foreign brands in India were valued and supposed to be better in quality (Sharma, 2013).
It has been put forward by Mathur (2011) that amongst the entire world’s customers,
Latin Americans and Asians were the leading supporters of globalisation due to which the
situation was highly constructive for McDonald’s. The customers in India were eager about
the market state of affairs which offered them with plentiful choices to prefer and make a
choice. People have a preference for fast food products because they are cheap, trouble-free
to prepare, and profoundly promoted. India is a developing economy having 2% of organized
and 98% of unorganized sector and due to this most of the fast foods that enter into Indian
economy as India has a better expansion prospects in every sector (Harris, 2009).
The product portfolio of McDonald‘s in India is round about analogous to other
burger chains with a leading Indian taste. Possibly, it would-be right to mention that the only
similarity of the company with its foreign outlets is that it served have French Fries in India
and still utilises buns. Apart from this, McDonalds has accomplished a gigantic localisation
in its menu and it would not be astonishing to notice Indian Chapatis as an alternative to buns
in the Indian market (Sameer and Kaur, 2012). The servings of McDonalds in India till 2012
are:
McDonald‘s recognised the fact quite early that for the purpose of attaining happiness amongst customers, the likely route is by happy, motivated and dedicated employees. The Business Model of McDonald‘s in India is a franchise-based model in conjunction with a very strong corporate branding (Sameer and Kaur, 2012). The emphasis is on the branding of McDonald‘s as an internationally customary service supplier with potent customer insight about:
It will be no wrong to mention that McDonald’s in India transformed the food
retailing business completely and become the first company actually to launch Indian
customers with service values which were obtainable in the western countries since many
years. These service principles were noticeable and striking, and for this reason they
prompted rapid recognition within the customers. Further, the company positioned itself in
the Indian market as a family restaurant, which also stimulated its success (Sameer and Kaur,
2012).
McDonald’s initially targeted the capital of India and opened up its first restaurant in
Delhi. Later on the second one was opened in Mumbai, which is known as the financial
capital of India, Mumbai. Although, at the starting the company emphasised on the West and
North regions, but afterwards, McDonalds showed signs of determined plans for extension in
Eastern and Southern regions. However, with the constant growing Indian market,
competition and changing taste of customers it is essential for McDonalds to look for
business growth opportunities in entering the Indian market (Chaturvedi, n.d.).
In the viewpoint of Bagri (2014), India has protracted standing of being isolated to
foreign businesses; however when it arrives to fast food, global chains are being
affectionately greet by a youthful, upwardly populace. In the last few months, Krispy Kreme,
Taco Bell, Burger King and McDonald's have either declared plans to grow in India or to
initiate novel outlets in the country. Regardless of the economic quandaries in the country,
the average middle-class consumer's expenditure power in India is growing progressively,
with a lot of people, chiefly women, inflowing the workforce. Additionally, Indians' also
augmented their disclosure to global cuisine by the media and travel, which makes the
country an attractive target for global food chains striving to enlarge globally (Bagri, 2014).
People in India are obtaining new tastes instead of altering their tastes, considering the
fact that it takes a complete generation to in fact later tastes. The customer contour and
demographic for fast food restaurants in the country has noticeably altered. Since, the country
has one of the youthful populace in the world, with almost 65% of the populace below 35
years age; a lot of youthful professionals are consuming fast food in metropolitan India.
Formerly, quick-service restaurants were exploited only for celebrations and occasion
purpose (Chaturvedi, n.d.). Nowadays also, the weekend and family trades continuing, but
working people are exploiting the sector far more as compared to the past. Fast food
restaurants have now become an alternative for young professionals having disposable
earnings to make use of QSR for meals on a weekday.
Fast food industry of India has been witnessing rapid growth due to the positive
developments as well as massive investments in the nation. Presently, market growth in case
of fast food industry is mainly fuelled by young population and working females due to the
increased deposable income of middle class families and chaotic working schedules of
women. Indian fast food is presently one of the most preferred industries as it has constantly
been offering enormous opportunities for both national and international players (Kannan,
2014).
The Indian fast food industry, as per the recent research report, is expected to grow
around 34% in the coming years as large numbers of multinational companies are inflowing
into the market by entering into business deals with the local companies. Another reason for
significant growth of Indian fast food industry is the expansion of already present market
players in different provinces of the country. This trend of Indian fast food industry will
emerge more strongly during the coming years which will ultimately provide bagful
opportunities to the local players to expand their product portfolios (Kannan, 2014).
Apart from this, Indian fast food industry is well known for providing affordable and
customized food products that best suit with the requirements of Indian middle class families
which is the major reason for constant boost in the Indian fast food industry. Out eating in
India has progressed from an occasion-driven activity to a routine activity due to various
factors such as rise in number of nuclear families, increase in number of employed females
and boost in the number of twofold income families (Kashyap, Kashyap and Sarda, 2013).
In the viewpoint of Kulkarni and Lassar (2009) McDonald’s India intended to put in $
75 million to $ 100 Million in coming years in the Indian market to add more restaurants in
the nation as compared to the present number of chains. The company has to put its focus on
the extension of the brands presence and overture of novel formats.
A report by McKinsey Global Institute (2007) exposed that; India would link with the
leading group of the world’s consumer marketplaces by the year 2025. With the middleclass
escalating by 12times to almost 583 million from 50 million, the market prospective is
enormous. McDonalds is having long-standing plans for the Indian markets and for this is
essential for the company to comprehend the concealed possibility and prepare itself to admit
the challenge.
It is considerable that about 63% of the population in the country lies in the age
bracket of 15-64 years and 31.8% lies in the age grouping of0-14 years, due to which the
growth opportunities are very high for McDonalds in the country. The middle class consumer
is the backbone of the Indian economy and at the same time the rising income of youthful
middle class is fuelling the growth of India (Kashyap, Kashyap and Sarda, 2013). It has been
mentioned by Han (2008) that in the chase for improved living and increasing the quality of
life, middle class people in India are demonstrating potent ambitions to develop financially
better. This chief factor has made the Indian economy a lively probable market for companies
in different areas, for instance consumer durables, food retailing, automobiles and so on.
Regardless of the notion that internationally McDonald’s unhurried its growth there
were no boundaries on the Indian operations. This piece of evidence has made it apparent that
the outlooks and plans in entering the Indian market by McDonalds. India can be determined
as the chief 10 markets for McDonald’s. McDonald’s has often been connected with its high
prices in India and consequently, growth and expansion outside the metro cities in India is a
critical and thinkable issue for the company considering the affordability issues (Anand,
2011). Even though, McDonalds has done a very well catering to India’s flavour fondness,
the regional culture of the country is very much diverse due to which for entering in India it is
essential for the company to fetch novel products recurrently, which is undoubtedly a costly
strategy in spite ofthe profound supply chain plan of the company (Bagri, 2014).
Hence, the greatest concern for any food company in India unquestionably was
related to balancing the multiplicity in the country with their offerings. Another growth opportunity lying in front of the company is to translate the McDonald’s experience to the
Indian loads and sustaining uniformity in the delivery of services. Kannan (2014) has put
forward that rivalry from other fast food companies, such as KFC, Pizza Hut, and other
domestic food chains is strong in the country in terms of pricing and the menu due to which
for growth McDonald’s India has to work with huge efforts to set up and sustain successfully
in the India market. It is considerable that in present days, the Indian culture has formulated
of more health determined consumers (Geringer and Hebert, 1989; Newcomb, 2013).
Therefore, to be a primary fast food chain with the FDA sanction on marketing a little
fat calorie hamburger would be a huge pro for McDonalds for growth in the Indian market.
The company can also bring changes in its restaurant settings as more luxurious setting, for
instance the one it has done in the New York City, would plea to a more “stylish” audience.
The company also has vital business growth opportunities in entering the Indian market by
delivering without allergen charge items (peanut and gluten free, lactose free). In addition,
McDonalds needs to put it focus on delivering novel products which will be vigorous with
the digitalized environment (Aloia, et al., 2013; Fatehi, 1996).
As per the outlook of Mishra and Dwivedi (2013), in the highly competitive Indian
market McDonald’s has to incessantly think of fetching novel concepts into all its business
functions, particularly, in marketing. McDonald’s has to strive for bringing in something
which will aid it in long standing sustainability and that unparalleled place in the market as a
“foodtailer”. In line with this, Kashyap, Kashyap and Sarda (2013) have elucidated that the
Indian fast-food sector is approximated to be two times from the recent Rs.3,400 crore in the
subsequent three years time, mainly derived by demand from less important cities.
In addition to this, the Quick Service Restaurant (QSR) in the market will become
more than double from Rs 3,400 in 2012-13, to approximately Rs 7,000 crore by the year
2016 determined mainly by novel store additions and most of the novel stores will turn up in
the row smaller cities. Apart from this, over the coming years, novel store additions will rise
by 16-18% per annum, pushed by the quick growth of international companies into smaller
cities. Hence, it can be mentioned after the evaluation and critical analysis of the business
growth opportunities in the Indian market that McDonalds has bright future prospects and
have to take crucial steps to tap the market (Goyal and Singh, 2007.).
Although, it is evident from the above mentioned discussion that international chains
opening in India have a better prospect in the country are more probably to attain success in
coming years. However, it is also considerable that foreign fast food chains will find that
functioning in India is not that easy and full of challenges. Similar to all the other good
businesses, restaurants have to be acquainted with their customers, which in India imply no
beef products in McDonald's context. The key challenge in the Indian market is
differentiation and this for fast food chains implies differentiation in terms of menu.
Companies are forced to come up with a high-quality sense of flavour and localization devoid
of compromising on their core product (Yadav and Krishnan, 2008). In addition to this, the
supply chain in the Indian market also presents a threat considering the fact that there are no
active cold chain links or national suppliers, which can offer across dissimilar locations for a
variety of products (Egelhoff, 1984).
It has been mentioned by Schlosser (2012) that many international players want to
step in, but when they approach and test out the scene on the ground, they comprehend that it
is not that trouble-free. There is a lot of hard work for McDonalds and for anyone who is
striving to come in and grow. Companies have to invest a huge amount of capital, and have to
get down into the implementation of the business that is requisite. The below listed are some
of the challenges that needs to be addressed for functioning successfully in the Indian market:
Vegetarianism: Cow is holy in India and worshipped even today, and therefore, beef
cannot be served, at any cost. With almost 25 to 30% of the populace being vegan and a huge
mainstream consuming meat, generating alternatives is essential. McDonald has to even
isolate the non vegetarian cooking procedure from the vegetarian cooking procedure to
induce both customer groups. Indeed, there is a typical issue of product adjustment, to grow
grip in the Indian market.
Rivalry from Local Food Retailers: The rivalry from domestic food companies is
also powerful in the country, and therefore, it is challenging. Food retailers are in business for
many years and their acquaintance with the market-place and the comprehension of the local
experience provided them a competitive advantage (Charles and Smith, 2007). There are a lot
of eating joints offering meals and snacks with reasonable price. Food preferences by
consumers are impetuous; fragrance, taste, behaviour and visibility works on the
subconscious stage and are vital in emotional decision making. Local businesses precisely
comprehend the psychology of customers and function as per it, and hence, beating them is a
challenge (Majumdar, 2010).
Price Issues: although, the income of people in India is rising, but then also price is
an insightful issue in India. Therefore, the perfect strategy is to emphasise on customer’s
aptitude to compensate and knock the wealthy and greater middle-class populace in the
country. McDonald’s policy is to augment sales by developing products accessible at
inexpensive prices, but then also its offerings are perceived to be costly (Hatch and Schultz,
2003).
Eating Habits: Eating outside at homes was an extraordinary time to a lot of Indian
families and meals were considered necessary means for social involvement and relationship.
However, the tendency in metropolitan cities is altering, with additional nuclear family units
and double earnings houses, the need for fast and expedient food is increasing. However, the
demand of the increasing functioning inhabitants also prompted the demand for novel
products and services. McDonald’s has to look for ways and processed to inspire the
customers to have early trials and acceptance (Facella and Genn, 2008).
Nutrition and Health: Mass-produced food is slowly and steadily replacing fresh and
nutritious foods in the diets over the time of the 20 th century. However, this has generated an
argument on healthy food and increased a wide range of novel campaigns devoted to cheering
healthy lifestyles and nutritious eating. Food industry is highly criticized in the healthy food
debate, which is challenging for fast food companies (Kulkarn and Lassar, 2009).
The elementary subject matter of the literature review section is to discover the business growth opportunities in the Indian market with reference to the giant fast food company McDonalds. In this regard, the main endeavour of the literature review chapter is to highlight a diverse range of literary sources that bring out facts and derails about the Indian market along with the fast food market in India. The chapter also presented discussion about McDonalds in India and the way it has grown by far. However, it has been discussed that the taste and behaviour of customers in India is changing and the Indian market is presenting a lot of business prospects to the company. This makes it clear that the company has to make potent efforts for the purpose of accomplishing long term position in the industry and tap business prospects. However, the challenges while operating in the Indian market have also been detailed out in this section to mention a critical discussion.
The research methodology chapter is a significant element of the research process
considering that it offers information regarding the various tools and techniques exploited for
the purpose of conducting the research in a thriving manner. Basically, research methodology
indicates tools and techniques utilised for amassing and analysing data so that reliable and
valid research results can be attained. It will be no wrong to say that research methodology
acts as the blue print of the entire research (Dawson 2002).
This chapter will not only detail out the data collection methods followed by the
researcher by will also present information about the research ethics the researcher will
follow and the limitations of the selected method chosen in this research. With respect to this
research work, it is substantial to note that research methodology chapter will offer
information about the research philosophy, approach, design, sampling technique and data
collection methods helpful for researching the growth opportunities for McDonalds in India.
Basically, there are two main research methods, qualitative and quantitative research
method and a third one is also there called the mixed research methods. This research will be
qualitative study done on the basis of qualitative data selected from a specific group of
participants. Qualitative research is also known as exploratory research which is mainly used
to gain an understanding of underlying reasons and motivations. This is mainly used to
uncover and seek the trends in thoughts and opinions. On the other hand, quantitative
research is the method which is used to quantify the problem in order to resolve it with the
way of generating numerical data in order to solve it in a statistical manner. This kind of
research method is used to quantify attitudes, opinions and behaviors. the major difference
between qualitative and quantitative research is that qualitative data collection methods
utilise unstructured or semi structured technique which include individual interviews and
focus groups to solve a problem while on the other hand, quantitative research method utilise
structured technique which include online surveys, paper surveys, online polls, systematic
observations and telephonic interviews.
The reason for choosing qualitative research method in this study is that it will allow
gathering data suitable for the study in order to present the analysis of the business growth
opportunities present to companies while in entering the Indian market with reference to
McDonalds (Walsh and Wigens, 2003).
Researchers perform their research in a diverse manner, however there are also some
set principles, rules and measures known as philosophy and the two main research
philosophies are positivism and interpretivism. Amongst the two philosophies, the positivism
philosophy reveals research outcomes considering the aims and objectives of the research,
research question and hypothesis, but not the other relevant factors (Taylor, 2005).
Interpretivism is a philosophy, which helps to generate research results and
conclusions after taking into account other factors in addition to the research question,
hypothesis and aims and objectives of the research. However, this research philosophy is
subjective because the researcher often intervenes in the research. This philosophy considers
the personal aspects, attitudes, beliefs, as well as other additional factors for attaining the
outcomes of the research in a consistent and legal manner(Wahyuni 2012).
This research work will follow the positivism research philosophy as the results of
this research will be on the basis of the designed question and aims and objectives and not on
the basis of any subjective factor. This research philosophy mainly comprises of a definite set
of measures, such as selecting topic, setting aims and objectives, formulating research
questions, gathering information and data from a variety of sources and evaluating it by
utilising diverse techniques for attaining a consistent outcome. The main reason for using this
research philosophy is its ordered and controlled approach (Wahyuni 2012) and will also help
in making decisions at different phases of the research in an objective manner.
Research approach is mainly a technique of reasoning utilised for the purpose of
performing the research and the two main research approaches are inductive research
approach and deductive approach. Research approach plays a vital role while generating a
flow of activities at the time of conducting a research activity. The major difference between
inductive and deductive approach is that deductive approach is considered as an aimed and
testing theory whilst inductive approach is aimed at generating new theory that has been
emerged from the data collected while conducting the research study.
Apart from this, deductive approach begins with a hypothesis whereas an inductive
approach makes use of research questions to narrow down the scope of research study.
Inductive approaches are usually linked with qualitative research whereas deductive
approaches are usually linked with the quantitative research. The most significant point that is
to be considered, while conducting the research study is the purpose of research study and the
methods that are suitable for exploring the area of study, testing a hypothesis and to answer
specific research questions.
Inductive approach is a technique that enables the researcher to embark on a
generalised view. This research approach is flexible as alterations in this can be done and it is
not based on any theories or models (Blaikie 2009).
However, deductive approach enables in attaining a particular view from a general
topic by doing some deductions and it mainly focuses on theories and models suitable for the
topic. This research work will make use of deductive approach as it assists in gathering
knowledge about the influence of different market opportunities in Indian on businesses
targeting it. This approach is also useful because it is as it is based on positivism paradigm.
Important information gathered from different sources about the Indian market opportunities
and impact on businesses will aid in accomplishing substantial outcomes (Hackley 2003).
However, it is noteworthy that this approach is not flexible in nature as it provides results on
the basis of different theories and models.
Research design technique is mainly concerned with the description and depiction of
needed steps that are required to be followed for the purpose of bringing together the
appropriate information. The research design mainly presents the diverse facets of the
research and elucidates information concerning the dissimilar factors of the research along
with their inter-connection. In conjunction with the information about variables, research
design is also helpful in accumulating the suitable data by describing its nature and influence
on the research outcomes. Research design can be mainly divided into three categories;
exploratory, descriptive and casual (Laurel 2003). In exploratory research design, the
researcher initially emphasizes on delivering some introductory information about a definite
topic. It is mainly performed with the help of qualitative data, and not by adopting any
statistical tools for the purpose of data analysis. This research mainly allows exploring the
information on the research subject and is more qualitative in nature (Rubin, Babbie and
Rubin, 2012).
On the other hand, descriptive research offers comprehensive information on a
research topic for developing the conclusive results and its analyses the research design in a
comprehensive manner. On the other hand, causal research investigates the impact of one
factor on another and more explicitly, the impact of one variable on another. This design will compute the influence of a particular change on current norms. The research design selected
for this study is descriptive research design as it concentrates on examining the current
scenario of the Indian market along with the opportunities it provides to businesses while
entering the market (Blanche, et al., 2006). This research design will aid in describing the
different factors that impact companies entering in the Indian market.
The data collection methods used in this research is primary and secondary data collection
methods, in order to deal with the research questions in the best way possible. The below
mentioned is the brief discussion about the data collection methods used in this research:
Primary Data Collection Method: Primary data will be gathered specifically for this
research only for the first time, and thus, it will be absolutely original. There are a number of
primary data collection methods available to researchers for amassing the primary for the
research, such as survey through questionnaire, interview method, observation method, etc
(Rubin, Babbie and Rubin, 2012). For the purpose of gathering the primary data in this
research and to critically analyse the business growth opportunities in entering the Indian
market interview method is used in this research work (Jackson 2008).
The interview will be conducted on managers present on the different outlets of
McDonalds in India and the responses of these participants will be gathered to generate
findings on the business performance and growth potential available in India for McDonalds.
Primary data in the form of manager’s opinions will be gathered by the researcher only after
taking the consent of the participants and mailing them the purpose of the research so that
they will get an idea that why this research is important and the reason due to which their
opinions matters. Telephonic interview will be done with the managers as due to time
constraints it will not be possible to do face to face interview with each of them. The data
gathered from the interview process will offer information about the problems faced by
McDonalds in the Indian market together with the novel prospects they foresee (Walsh and
Wigens 2003).
Secondary Data Collection Method: The primary data will be supported in this
research by secondary data, which will be collected from secondary sources for the purpose
of addressing the research aims and objectives. This data will not be original as it has already
been gathered and is readily accessible. The secondary data collection sources comprises of
(but are not restricted to) books, academic journal articles, online articles, newspaper articles
and company reports (Jackson 2008). The literature review of the research is composed with
the aim of getting and exploiting appropriate secondary data. Even though, a full reliance on
secondary data for examining a research issue is problematic, but then also secondary sources
are vital in the research for supporting the primary findings (Gill and Johnson, 2010).
3.6 Sampling Methods
It has been analysed from the above mentioned data that data collection is
undoubtedly the most important aspect of research analysis. It is extremely significant for all
the researchers to pre decide the respective respondents from whom data will be gathered in
order to ensure an effective data collection. The method of interpreting different
characteristics of respondents which should be based on objective and motive of study and as
a result, recognition of target group from the total population on the basis of the following
properties is known as sampling (Cochran, 2007).
Sampling can be done with these two appropriate methods in which the first method is
regarded as the probability method of sampling. A probability sampling method is one of the
best methods of sampling that mainly utilises some kind of random selection. Under this
random selection method of sampling, it sets some kind of process or procedure that ensures
that the different units in the population have equal probabilities of being chosen. For
instance, humans have regular practice of choosing the things randomly, such as picking a
name out of a hat, or choosing the short straw (Thompson 2012).
Nowadays, computers are mainly used and utilised as the main mechanism in order to
generate random numbers as the basis for random selection. In contrast to this, another
appropriate method of sampling is non probability sampling which does not allow choosing
the element randomly. In other words, Non-probability sampling is a sampling method in
which the samples are collected in a way that does not give all the individuals in the
population equal chances of being selected (Knottnerus 2003).
This paper uses or utilises random sampling procedure to gather primary data from
respondents. The following technique allows high flexibility which is mainly based on
normal probability distribution graph. This is a fair procedure that gives chance to each and
every individual of research population in order to participate and become the part of sample
size. The following method has quantitative parameters, which helps a lot in reducing the
chances of biasness, and increases the genuineness and reliability of all the research findings
(Poggenpohl and Sato 2009).
The primary data for the following research analysis has been collected from the 5
major administrative managers of McDonald’s outlets in India. The following study is mainly
about the extent to which the Indian market represents opportunities and major challenges for
McDonalds and therefore, the interview questionnaire has been designed in this format only.
It is really important to conduct the research work under the ethical limits and
therefore, the following ethical guidelines have been defined in order to conduct the research
work peacefully. In context to this, the most important aspect is the originality of work which
means that the work or research should not involve any kind of plagiarism and must not be
imitated from other’s work. Another important issue is that the confidential information of
the respondents should not be leaked and must be protected with tight security. For instance,
the mechanism of cryptography or encrypted text can be used for the following procedure.
Apart from this, the next issue is to involve the people in the research work with their full
consent as they should not be compelled to be part of the research work and they must be
ensured that the primary data gathered from them will not be used for any other purpose
(Kimmel 2007).
Besides this, steps must be taken to ensure the appropriateness and genuineness of the
secondary data and it must be ensured to respondents that the data collected from them will
not lose its exact meaning while its interpretation (Walsh and Wigens 2003). The technique
of proper referencing and in- text- citing can be adopted in order to resolve the following
issue as the technique allows the users to cross check their data relevancy, as and when
required. The above technique helps to reduce plagiarism as well as increases the reliability
of data (Cohen, Manion and Morrison, 2007).
For this major purpose of implementing the following research work, which is aimed
to find out the major business growth opportunities in entering the Indian market for
McDonalds in the most realistic and accurate manner, it is extremely important to take into
deliberation all the research limitations that may harm or have negative impact on the
outcomes of this research. Another major limitation is that participants may not provide the
genuine information and their perception as they might feel that their personal information
can get leaked which can trouble them in future and this aspect can impact the outcomes of
the research in a inefficient manner. (Lancaster 2005).
The interview procedure has been selected to carry out this research work but
managers may find it difficult to answer the following questions because of their busy
schedule which may hamper the outcome of the research work. Apart from this, researchers
may also misinterpret the feedback of different customers as everyone has different sense of
humor and this aspect can also alter the results of the research. Therefore, it can be said that
the above limitation can have negative impact on findings of the research work. In context to
this, participants or respondents may not find it comfortable to provide their feedback in an
efficient manner as a person can’t work properly if they are not in their comfort zone.
Therefore, it can be extremely difficult for the researcher in order to get an exact view
of what growth opportunities in and major severe challenges are present in the Indian market.
Apart from this, the quality of a sound research depends highly on the skills of the
researchers and the respondents opted to conduct the research effectively and if individuals
are not efficient to provide exact and precise information then, the outcomes of the research
can be affected badly. In nutshell, it can be said that some of the data sources that have
gathered in the research procedure can be inefficient due to the lack of genuine data as
confidentiality and anonymity can serve as a great hindrance while presenting a sound
research. Therefore, it is very important to overcome these issues in order to avoid any kind
of difficulty while conducting the research activities. (Lancaster 2005).
It is clear from the discussion that this research has espoused on a holistic approach
for the purpose of attaining and upholding impartiality at the time of data collection. In this
regard, the use of descriptive research design is suitable for the purpose of discovering
opportunities and challenges that will impact the performance of McDonalds in the Indian
market. In addition, generation of primary data with the help of interview method will be
helpful in augmenting the on the whole credibility of the research findings. It would be
logical to declare that the research methodology chapter is focussed at improving the
regularity, reliability, and appropriateness of findings collected in this research.
The main aim of the data analysis chapter of this research study is to exhibit the
gathered information from research participants in a meaningful manner so that significant
research conclusions can be drawn (Wellington and Hammond 2012). With respect to this, it
is noteworthy that presenting information in a sorted manner will assist the researcher in
drawing consequential results. This way the aims and objectives of the research will be
addresses pertinently and the growth prospects along with challenges in the Indian market for
McDonalds can be explored.
This section presents the data gathered in the form of views and perceptions from 5
administrative managers from Indian McDonalds outlets with the help of the designed
interview questionnaire. The answers of the research participants accumulated from the
telephonic interview have been demonstrated in the form of bar charts after sorting out the
gathered raw data from the 5research participants. Apart from this, the gathered responses of
the interview method have been evaluated by using the ground theory method, which in turn
will facilitate the researcher to identify the trend of a specific phenomenon in terms of
definite circumstances (Winch 2009). It is significant that all the research investigation and
information is determined to recognise the growth opportunities in the Indian market for the
fast food giant McDonalds.
The close ended questions in the interview questionnaire are determined to collect bounded answers from the managers. Their bounded responses have been presented with the help of chars. In this context all the charts, it should be noted that the Y-axis represents the responses of the participants, whereas, X-axis represent the number of respondents. The observed response have been analysed as following:
When the managers of the Indian outlets of McDonalds were enquired about the
frequency of fast food consumption in India, in the current times, it has been observed that 2
out of 5 managers believed that consumers in India preferred eating fast food once in a
month, because they find fast food unhealthy and do not like to consumer more than once in a
month. In contrast to this, other 2 managers mentioned that consumers like to eat at least
three times in a month. These managers stated that Indian populace, comprised of students;
business people and people living at home take a lot of interest in fast food products,
especially because of the take away service, which offers them the convenience to have their
meal in no time.
On the other hand, only one manager supported the choice that consumers eat fast
food once in a week. As per him, even though the Indian populace is inclining more towards
fast food and enjoy the delicacies, but they not like eating fast food frequently and prefer
eating after at least 5-10 days. However, none of the managers supported the choices
occasionally and in every two days. This shows that consumers in India are still at the
beginning phase of the fast food culture as the component of their lifestyle and a lot of
likelihood for fast food is there to develop in the upcoming years.
The below mentioned chart shows the responses of participants on the factors, which
influences customers for eating fast food. While assembling responses from five managers
working in McDonald’s outlets, it has been found that all of the respondents strongly
believed that taste is the key reason due to which consumers in India prefers eating fast food
products and taste factor contributes imperatively in the sales and profit margins of fast food
companies. Besides this, there were around 3 managers, who favoured convenience also as
the reason due to which consumers are interested in fast food products. As per these
managers, many big fast food companies offer take-away service to customers as well as self
services, which quickly grab the attention of expedient loving Indian consumers.
Additionally, two managers out of five also stated that fast food restaurants give
customers a lot of varieties in their menu, for instance, McDonalds offer large variety of
burgers, and KFC offer chicken varieties, Pizza Hut offer pizza varieties, which customers do
not get elsewhere, and thus, prefer eating fast food products in these restaurants. On the
contrary, one manager also supported relaxation and substitute food as the reason for
preferring fast food in India. Therefore, it is apparent that taste and convenience are the chief
reasons due to which fast food consumption has become a new trend in India. It could be
inferred that youthful consumer lifestyle inclinations comprises of taste, expediency and
looking for menu varieties, which become the chief reasons for eating fast food.
In the current study, to analyse the preference towards McDonald’s Restaurant and to
explore growth opportunities for McDonalds in India, manager were examined about the
reasons due to which they believe that Indian consumers are taking interest in McDonald’s
restaurants. In this context, different variables related to the preference on fast food were
provided to research respondents, such as affordability, service quality, taste, variety, and
Location Orientation and Ambience and the results have been presented in the figure below.
It is observed that all the managers strongly supported taste as the foremost reason for
consumers to prefer eating in McDonald’s Restaurant.
Managers explicated that, customers many a times mention the fact that the unique
and delicious taste, which they get in McDonalds burgers and wraps are not available
anywhere else. It is the taste in McDonald’s products, which forces them to visit the
restaurant again and again. However, varieties of delicacies in McDonald’s restaurants are also key influential factor that persuades Indian customer. The way McDonalds offer a right
mix of burgers, meals, ice creams and beverages, influences them to visit the restaurant for
trying the different offerings at least once. Additionally, equal number of managers supported
service quality and affordability as reasons due to which consumers prefer eating at
McDonald’s restaurant, while only two out of five managers believed that locations and
ambience are noteworthy influencing factors and there importance cannot be denied.
All the McDonalds restaurant have the statue of Mr. McDonald, the red interior of the
restaurants, the self service aspect and the different seating facilities for children in some of
the restaurants are some of the major aspects that persuades Indian populace as these new
trends for them. Hence, it is can be concludes that taste and varieties are found to be the most
significant factor, which influences consumers to prefer McDonalds restaurants followed by
affordability, service quality and Location-orientation and Ambience.
The below presented figure depicts the responses collected from five administrative
managers employed in McDonalds restaurants in India they were questioned about the
performance of McDonalds in India in their respective areas or places. It is found that there
were 4 managers who explicated their views in favour of McDonald’s good performance in
the Indian market. As per them, the company is making good amount of profit in the Indian
market, though not excellent as their outlets have been impacted in the constructive manner.
But, 3 managers also supported McDonald’s performance as excellent in the Indian
market because as per them the company is successfully satisfying customers with the help of
its offerings and gaining huge profit in the market.
On the other hand, two managers were neutral about McDonald’s performance and
believed that the company is neither performing too good nor too bad, while only manager
was there who mentioned about the poor performance of the company in comparison to local
competitors and believed that McDonalds need to make significant efforts for tapping the
Indian fast food market successfully. As per the experience of these managers, McDonalds
can augment its business potential by applying competitive strategies as they will
significantly impact the performance of the company.
The below mention is the analysis of responses gathered from open ended questions and it is vital from the outlook of accomplishing aims and objectives of the research work:
In response to the interview question that why managers found the Indian fast food
industry, growth driven, many of them agreed to the fact that it is because of the changing
consumer behaviour in India. One of the manager mentioned that the Indian fast food
industry is growth driven because of the rise of nuclear families in India or single-person
households along with growing percentage of women in the workforce. These factors have
forced customers to look for food products, which are available conveniently and can also be
consumed easily. On the other hand, two managers detailed out that the changing lifestyle
and eating patterns of the India populace is the major reason of the growth driven fast food
industry.
Managers have also explained that in the middle of an economic slowdown, India’s
consumers’ wants to give themselves a cheap treat. Fast-food chains are developing speedily
in India catering to the young and ever wealthier population of the country. However, a few
of the managers mentioned the fact that this does not mean that local stalls and food sectors
will lose their significance. Even though the Indian fast food industry is growth driven, but
then also the market will be pertinently dominated by miniature domestic stalls, and thus, fast
food restaurants have to struggle to find a place in the India food sector and to take advantage
from the mouth-watering prospects.
In response to this question, all the respondents agreed that the country has tied with
the bandwagon and the future of the Indian fast food industry is undoubtedly bright. On the
of the manager mentioned that the current trend in the Indian fast food market evident that
soon the industry is going to double in value, principally driven by the demand from smaller
cities and the urge of the nation to become a world class country. Managers mentioned that
fast food sector in India survive even at the time of the economic slowdown, and thus, its
future is definitely not in vain.
Addition of a lot of new outlets in small cities not only from McDonalds, but also
from other fast food companies will modify the face of the Indian fast food industry. One of
the manager elucidated that in coming three years, new store additions in India will augment
by 16-18% per annum boosted by the quick increase of international players into smaller
Indian cities. As per the respondent, recently small cities have a little proportion of the total
stores, and thus, new store additions will take place. Another key reason due to which the
future of the Indian fast food industry is vivid is the increase in the amount spent by the
medium income households in smaller cities in comparison to the metropolitan cities.
Managers mentioned that the performance of McDonalds in the Indian market, if not
too poor, then also it’s not excellent, and thus, there is scope to bring further changes for
improving the performance of McDonalds in the Indian market. As per one of the manager,
fast food restaurants in India are found to be associated with high prices and therefore,
improvement or expansion outsidethe metros is unimaginable due to affordability issues.
Thus, the company management has to focus on this issue and make the products affordable
to serve the small cities in India. Another manager stated that to tap the high growth
opportunities in India with customer satisfaction criteria efficiently, McDonalds need to focus
on the technological advancement aspect too.
Company has to work on bringing new technologies so that it will offer superior
service and high expediency to Indian populace. Respondents have also mentioned that for
sustaining in the competitive market McDonald’s has to constantly think of bringing in novel
concepts into all its business operations, in particular in marketing. The company has a
chance to encounter with a technology expert and introduce online booking orders as well as
birthday parties and signature outlets. Managers explicated that to a lot of view McDonald's
as an unhealthy junk food company, and to address this, McDonald's has to reinforce its
creative messages by putting emphasis on the quality of food and has to also address the price
issues in India.
When respondents were asked to mention about the challenges, McDonalds has to
address for growing in the Indian market that a bigger challenge for the company is to
translate the McDonald’s experience to the Indian masses and sustaining constancy in the
delivery of its services. Competition from different fast food giants, such as KFC, Pizza Hut,
and other local food chains is intense on the basis of menu varieties and pricing to continue
getting from the favour from the middle class and the affluent. Some of the managers
mentioned that the company has to work on maintaining differentiation sustaining the high-
quality of flavour and localization.
McDonalds also need to consider that eating habits of customers in the Indian fast
food industry are changing and addressing them significantly is a challenge for the company.
McDonalds is facing criticism all around the world to serve customers unhealthy food, which
is low in nutrition, and therefore improving its image and maintaining its repute, is also a
challenge for McDonalds in India. As the Indian customers are very sensitive about their food
and eating habits, McDonalds is facing the challenge to maintain their interest pertinently.
In light of the primary data analysis mentioned above, it has been observed that
today’s customers in India are more interested in the western culture and augment in the
facilities provided by the fast food services is driving the development in the fast food
industry. It has been observed that the frequency of visiting fast food restaurants in India is
not though high till now, but the western culture is developing in the country and soon the
fast food sector will be double in value. It has been found that the primary and secondary data
findings are in alignment as researchers have also mentioned that Indian fast food industry is
on the verge of development. The increase in income in the middle income households is
impacting the spending habits of individuals in the country.
Vijayabaskar and Sundaram (2012) has mentioned that the Indian fast food
behaviours and the consumers discernment towards fast food has observed steady change in
the current years as the momentous segment of the populace expend more money on
consuming fast food from the local and international outlets in the market. Prabhavathi,
Kishore and Kumar (2014) have also mentioned that that with the rise in income levels of the
middle classes in India, the increase of the Indian consumer is pushing higher aspirations, the
requirement for international level infrastructure, superior quality healthcare, brand top
consumer products and classy public and private services (Kashyap, Kashyap and Sarda,
2013; Mathur, 2011; Mishra and Dwivedi, 2013).
The extraordinary development of the novel middle class exterior to the western
economy will perhaps the most dominant economic trend in the coming years. The secondary
and primary research findings have made it evident that the future of the Indian fast food
sector is vivid due to the commercial focus on swiftness, uniformity and low cost,
convenience, taste, different varieties and demand from small cities (Rößiger, 2008). Hence,
it is apparent that McDonalds have a lot of growth opportunities in the Indian market, which
the company must tap with the right mix of strategies.
However, it has been also observed that consumers in India apart from taste and
different menu options is also interested in affordability, and thus, McDonalds has to work on
its pricing strategies to grow in the country significantly. The secondary findings have also
revealed that people in India are obtaining new tastes instead of altering their tastes,
considering the fact that it takes a complete generation to in fact later tastes. The customer
contour and demographic for fast food restaurants in the country has noticeably altered, but
along with expedient food options, customers are looking for reasonable food products
(Goyal and Singh, 2007; Majumdar, 2010).
In addition, it is considerable that the company is also facing different challenges in
the Indian market, such as most of the customer being vegetarian, different eating habits, and
concern for nutrition and health. This is in line with the secondary findings as Majumdar,
(2010) has mentioned that challenge for fast food business in India is to maintain the balance between diversity and the product offerings. Moreover, it is considerable that in present days,
the Indian culture has formulated of more health determined consumers, and thus, addressing
the challenge of health food demand amongst customers is essential for McDonalds to grow
in India (Newcomb, 2013).The secondary sources have also revealed that McDonald’s in
India has to take into consideration the cultural, economical and socio-political factors. This
is due to the fact that the Indian populace is externally diverse and multifaceted as the nation
is divided between different communities and religions.
Thus, McDonalds should include the practice of exploiting the healthy and nutritious
food products. The literature has revealed that there is enormous scope and prospective in fast
food sector in India and thus, the international players like McDonalds can take complete
advantage of the chance to extend their market share.
To summarise, it can be mentioned that the primary and secondary research findings are in alignment and made it clear that the Indian fast food sector is growing rapidly presenting many growth opportunities for McDonalds. It is evident from the responses of interviewees that fast food sector in India is developing due to demand from small cities and growing income of middle income households. However, to succeed in the Indian market McDonalds has to address a lot of challenges too by bringing in different changes in its strategies, such as pricing strategy, marketing approach and so on.
The above research study was helpful while examining the types of challenges
Western Fast Food chains face while entering the Indian market and how can they overcome
those challenges. In nutshell, it can be concluded that western fast food chains had to face
number of ups and downs to get settled in the Indian market properly as Indian population is
very much fond of healthy food. Therefore, they had to set lots of strategies in order to
influence Indian consumers as mentioned clearly in the above section. Apart from this, they
had to sustain in the market against their major competitors such as Pizza Hut, KFC and
Dominos which was quite difficult for McDonalds but they made it possible with the help of
their team work and efficient tactics. This has resulted in the increment of fast food centers in
India which has changed preferences and taste of Indian population on large scale.
Henceforth, it can be stated that the following research work has successfully attained its
aims and objectives.
It has been reviewed from the data collected through primary sources that McDonalds
has launched several healthy meals and snacks full of veggies and they also made it
affordable so that every class of people can easily buy it in order to attract Indian population
and as a result, it gave a positive outcome and now, Indian population especially children
really likes snacks of McDonalds. On the other hand, Secondary data analysis for McDonalds
has provided various that McDonalds has great opportunities in the Indian market as it has
also generated employment opportunities on large scale with handsome income which has
facilitated lots of Indian people. Therefore, it can be said that primary and secondary data of
McDonalds are in alignment.
It was really difficult for McDonalds to expand its activities where almost 70% of
population is Hindu and vegetarian but by offering huge variety of vegetarian food at
affordable price, it attracted lots of people. People give more preference for fast food items as
they are very cheap and affordable, very easy to make in less time, and profoundly promoted.
It has been estimated that India is a developing economy having 2% of organized and rest of
the 98% of unorganized sector. This is main reason that most of the western fast foods chains
that enter into Indian economy have better expansion opportunities in each and every sector.
On the other hand, McDonalds has also innovated its dessert section which attracts large
number of customers which mainly include ice creams, smoothies and chocolate drinks.
The main reason behind their success is that they have variety of products and items
available for each and every class of people. The main aim of McDonalds is to make their
customers happy and satisfied and their tagline is to “provide quality service to all groups of
people”. However, they had realized that chances of growth in Indian market are really high
as their products are sufficient enough to please and influence Indian population. So, it can be
estimated from the above evidences that market growth in India of fast food industry has
been rapidly enhancing as it is mainly uplifted by the young Indian population and working
females due to their busy schedule for which they do not get the time to cook and eat out.
Hence, the above research has successfully implicated that Indian fast food is currently one of
the most preferred industries in the whole world as it has constantly been offering huge
opportunities for western fast food chains such as McDonalds.
5.2 Recommendations On the basis of the above research work, it has been discovered that Indian market is very suitable for western fast food chains to expand their activities in India, but they will have to pay more attention towards the services in order to influence Indian population. Therefore, it can be recommended from the above discussion that:
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