Competition and
Strategy
Burger King operates in QSR category and competes with
Dominos (Jubilant Foodworks Limited) which has the highest number of outlets and
revenues
and McDonald’s (Westlife Development Limited) who is a market
leader in burgers and sandwiches segment. Their shares trade at very high price
to earning almost 50 times what was a year ago. Burger King is expected to have
attractive valuations. It banks on its cluster approach and outsourced supply
chain network to keep its working capital in check and support penetration
strategy. They have already registered 64% growth. Burger King India has master
franchise agreement to establish, operate, develop and franchise outlets and
aims to establish 700 outlets by 2025.
Benchmarks
SSSG (Same Store Sales Growth), an important metric for food
service restaurant, Burger King saw an increase from 12.2%(FY18) to 29.2%
(FY19). Despite its profit in red, healthy cashflows and quickly narrowing of
operating losses while maintaining expansionist aggression signals sustainable
business growth plan.
