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Double-Digit Revenue Growth for Westlife Development

Westlife Development, through its subsidiary Hardcastle Restaurants – the master franchisee of McDonald’s India (West & South) – was able to show high, double-digit revenue growth of 14.6 per cent, with total revenues touching Rs 2417.5 million, during Q3 of the financial year April-March 2016-17. The disclosure was made in the Westlife McDonald’s Corporate Financial and Operating Results for the fiscal.

Factors like a balanced brand portfolio, geographic footprint, consistent marketplace execution and relentless focus on productivity were the reason behind the success.

As Amit Jatia, Vice-Chairman, Westlife Development Limited, put it, “We are happy to report our sixth consecutive quarter of positive comparable sales of 5.1 per cent, demonstrating consistent performance across all segments, in the face of the recent volatile and macro-economic challenges.”

He further said, “Our bold actions have differentiated the brand in the minds of the consumer across the QSR segment. It is also a testament to the progress we are making,” Jatia added, in an interview.

Jatia was of the opinion that consumer sentiment towards McDonald’s is on the upswing, since liquidity has re-entered the economy, making it easy for McDonald’s customers to re-enter the restaurant. He also welcomed the Government’s move on Goods & Services Tax (GST), saying that it would not only help the Quick Service Restaurant segment, but also the economy as a whole.

Among other announcements, Amit Jatia said his Westlife company was also aiming to double its restaurant count by 2022 as well as more than double its margins as well. Two factors that would help achieve that plan were the right location and good unit economics.

According to the Westlife Development Report, the company’s performance growth was driven by restaurant network expansion, new formats being added, brand extensions being made and innovations in the restaurant menu.

The company also admitted having experienced a headwind on the demand in the eating-out segment as a result of the Demonetisation. But Westlife Development had converted what seemed like a negative development into a positive opportunity, and provide ease of payment by offering multiple options of payment.

The customers, in turn, were only too happy to make their payments using plastic, cashless transactions. The restaurant chain, Jatia said, had experienced a rise in cashless transactions by as much as 50 per cent.

Yet another achievement by Westlife had been the opening its 100th McCafé in just three years. The milestone helps to keep the company on track with its plan to double its McCafé base by end of financial year 2017.

The fresh investments made in product innovation and restaurant expansion were other factors that helped the company during the period.

McDonald’s restaurant footprint during the period showed gross addition of 30 new restaurants, which takes the total count of restaurants in west and south India to 236. During the quarter, the brand also marked its entry into Calicut, in the state of Kerala, further broadening its accessibility in south India. Westlife also added 13 new restaurants in Quarter 4 of Financial Year 2016 – six in Maharashtra, 2 each in Gujarat, Karnataka and Kerala, and one in Telangana, reporting a 13 per cent unit growth from the previous year.

Westlife Development is thus on track to deliver its stated goal of 175-250 restaurants in the five years.