News

New leadership at McDonald’s South Africa

March 17, 2011

Cyril Ramaphosa, a prominent Johannesburg-based businessman, has taken over McDonald’s restaurants in South Africa.

The Associated Press has reported that the company may be struggling in South Africa, prompting the new ownership.

Ramaphosa specifically bought a 20-year master franchise agreement to run all 145 units in the country. However, the agreement is unconventional in that it also would allot him asset ownership.

The transition will be unnoticeable to customers.

Ramaphosa founded an investment empire that included a Coca-Cola bottler, mines and a power plant. He also is a former union leader who participated in the African National Congress during apartheid-ending negotiations in the 1990s.

McDonald’s opened its first store in South Africa in 1995.

Boosting drive-thru presence in India

McDonald’s may be aiming for a turnaround in South Africa, but the company has a budding presence in India; one that’s about to get even stronger.

McDonald’s has partnered with the Indian Oil Corporation (IOC) to expand its footprint in gas stations in the western and southern parts of the country. This agreement, according to The Economic Times, will potentially double sales by 2014 in these markets.

The IOC has more than 8,000 gas stations in these regions. McDonald’s currently has 108 units in the South and West, and 211 in the entire country.

By 2014, the company aims to have 216 stores in the South and West.

India is a hot spot for quick-service chains, with unit growth per annum between 30 percent and 35 percent, according to a recent report titled “Indian Fast Food Market Analysis.”

McDonald’s has taken advantage of India's market potential, initially announcing an aggressive expansion plan in the country in 2006. With this plan, the Golden Arches anticipates a 10-fold growth by 2025.

In December, McDonald’s announced it would invest Rs350 crore – or about $78 million – in the Indian city of Ahmedabad throughout the next four years. The company also is investing approximately Rs100-crore (about $22 million) to open between 20 and 25 stores with drive-thru components throughout the next three years.