Starting a franchise business is always a profitable business and it returns the quickest ROI due to some reason which we are going to explore in this article.
This article is dedicated to McDonald’s franchise business and will explore what is the McDonald’s franchise cost in India, how you can start a franchise of Mcdonald’s in your city, how many types, and many more.
McDonald’s is one of the most popular and reputed restaurants in the world and doing business with this brand is always a profitable decision.
If you are thinking of starting a Mcdonald’s, this article will guide you perfectly step-by-step.
Now, before starting any business, we are supposed to go through the profitability, sustainability, and future of that business, right?
As a businessman, we can not aim in the dark, we must have all the data in terms of future plans, sales, profitability, and trustworthiness of the product.
So, in this article, we are going to explore all details about Mcdonald’s business, and you will be able to conclude whether you should take the franchisee of McDonald’s or not.
Is Mcdonald’s Franchise Profitable in India?
Whether you are living in India, or anywhere else, it doesn’t matter, because Mcdonald is an international brand so you will get benefits everywhere.
Now, the question is, is Mcdonald’s franchise business profitable? Should you buy the franchise of Mcdonald’s? If so, then why should you start the Mcdonald’s franchise in India?
Well, there are too many questions raised before starting the business of Mcdonald’s outlet, and it must be, after all, you are going to invest the eight-figure amount in the business, right?
The answer is: Yes, you should definitely start the McDonalds outlet of Mcdonalds, and it is very profitable everywhere.
Mcdonald’s is the biggest revenue chain business model in the world in terms of revenue, and it has stores in 100+ countries in the world.
Mcdonald’s holds 38,000+ outlets in the world and serves more than seven crore customers per day which is the world record.
Moreover, it is the second-largest private employment provider company in the world, and the first rank is Walmart. And Mcdonald’s has 2.3 million employees.
These are stats and facts about Macdonal’s, and now below are the reasons why you should start the franchise business in India.
Should You Buy Mcdonald’s Franchise For Business?
After going through the stats and facts about Mcdonald’s business model, you might be sure that the Mcdonald’s franchise business is profitable in India.
But why should you start the franchise business, what is the additional benefit of franchise business, and why is the owner of the franchises charging a huge amount for providing the same?
Whenever we start up a new business, we have to spend a minimum of 999 days to grow the business and to become sustainable.
It means, we have to survive with a new business model without profit or with minimal profit and revenue.
Moreover, we have to market our business, spend a lot of money on advertising, campaigning, building up the customer base, establishing trustworthiness, branding, authoritativeness, etc…
Whereas, whenever you buy a franchise of any reputed business, you don’t have to do any of the above-mentioned tasks, you get everything on the first day of starting the business.
You get the brand name, customer base, reputation, goodwill with the business and you don’t need to spend money on advertising and marketing because that stuff is being done by the company itself.
In a franchise business model, all the processes are set, you are informed which equipment you need to use, how you have to make the food, how much will be the quantity for such amount of food.
Service size, temperature, quantity, and quality of raw materials, all are predefined, you just have to process whenever you receive an order from the customer.
It is not like that you have to test one by one, or which one is working fine, what the customers like, etc…
All these experiments have been done by the franchise owners, so you are not going to take any risk.
So, in a nutshell, buying a franchise of Macdonal’s is surely profitable, and if you are planning to start the Mcdonald’s franchise business, you should move on to the further process.
Business Strategy of Macdonal’s Business Model
Mcdonald’s is one of the most popular restaurant business models in the world because of its business strategies and business model working system.
It follows a unique pattern to maintain the business standard across the world and it is the same everywhere in the world.
Mcdonald’s follows the QSCV Policy.
- Q – Quality
- S – Service
- C – Cleanliness
- V – Value
They focus more on quality, even if you go to any store of Mcdonald’s in any country, any state, you will find the same and consistent taste everywhere.
Every customer of Macdonal’s is aware that even they go to any store of Macdonal’s, they will get the same taste and that is why they like and love MacDonald’s.
The service of Macdonal’s store is such a nice, and you might have experienced as well if you might have visited it.
You will find every store of Macdonal’s very clean everywhere, the entry point, service space, tables, washroom, kitchen, and every place you will find very clean.
The last strategy is; value because QSC is affordable for other restaurants as well, but giving value is not affordable for everyone.
But the most differentiated point is; value, Macdonal’s is selling the complete value for money product.
These are the four points on which Macdonal’s business is running and due to that millions of customers visit its store across the world.
Types of Macdonal’s Franchise Stores in India
Like Domino Pizza, Macdonald’s also is offering the multi types of stores outlet in India.
- Traditional Store
- Satellite Store
- STO/STR Locations
- BFL Franchise Model
Traditional stores are the common stores of MacDonald’s which are supposed to be opened around and inside the shopping malls, buildings, food courts, and they offer the entire menu as well in this type of outlet.
In this store, they offer a very good space for service, customers can enjoy the food with a family as well, and the lease term of the traditional store’s outlet is for 20 years.
The cost for a traditional store of McDonald’s franchise is around $45,000, which is 30,00,000/- rupees.
Satellite location for McDonald’s
Satellite location stores mean there are small stores in airports, universities, and hospitals, where you will not find the full menu, there will be only the selected items.
The franchise fee for the Mcdonald’s satellite store is $22,500 means 16,80,000/- rupees. There is not a fixed duration for agreement, it depends on the location that you choose to start the McDonald’s franchise business.
STO means small town oil location, and it is understood by name that the location will be inside petrol pumps.
STR stands for small-town retail, where you can open the McDonald’s franchise in the villages.
In this franchise type also you will get the full menu, and they will provide the full space that customers can have the food along with their family as well.
BFL means the business franchise leads offered for the three years on the lease, and the locations are under the business facilities.
For instance, if you want to open a McDonald’s store in the office, multinational company, then you can opt for this model of business for the franchise of McDonald’s.
Most people opt for the first two types of Mcdonald’s outlets, and the rest depends upon your business plan, however, all the business models of McDonald’s are profitable.
How to Get McDonal’s Franchise in India – Contact Person
McDonald’s is an international brand and is not doing its business directly in India, so if you want to open the mcdonald’s franchise in India, you need to contact the third party associated with the mcdonald’s business.
If you want to open a Mcdonald’s franchise in West India or South India, then you need to contact Hardcastle Restaurants Pvt Ltd.
And if you want to open the business of a franchise of Macdonald’s in East India or North India, then you need to contact the CRPL Pvt Ltd.
Now, moving on to the process of buying the franchise business, you need to read the disclosure agreement of Mcdonald’s of 375 pages and sign it.
There will be unfamiliar terms also in that agreement, so you would need the help of your lawyer or accountant as well.
After approval, you will be provided training through the university of Mcdonald’s which is Hamburger University.
You are supposed to attend the online courses in which you will be taught about how to run the Mcdonald’s stores, and the duration of completion of that course is around one or two years.
Once you and your staff complete that training and online store, you will be provided the license and will be allowed to open the mcdonald’s store.
Mcdonald’s Franchise Cost in India – How Much Investment You Need?
Finally, you reach the main topic of the article for which you have been reading this article for!
You need to have an investment from 6.6 crores to 14 crores to start a McDonald’s franchise in India.
You might be thinking, wow, it’s a very huge amount to invest, right?
But here you are getting too many benefits against this amount, the risk is about nothing, you are getting already branded business, you are not supposed to do any experiment that contains the failure chances.
You are dealing with the business models which have only success, so you have to pay the amount as well for the risk-free business, do you agree?
Alon with this amount of investment, you must have a liquid investment of Rs 5 crores for the upcoming expenses.
- Franchise Fees: 30 Lakhs (Average)
- Service Fees: 4% of total sales
- Advertising and Promotion Fees: 4% of total sales
These are only the major expenses, and apart from these, there are some more expenses for which you will get the disclosure agreement of the franchise.
ROI: How Much Time You Will Take to Become Profitable?
ROI: Return of Investment!
Whenever we are going to start any big business, it is essential to have the approx ROI so that we can plan the future plans for our business.
According to Mcdonald’s, you will be breakeven in two to three years, and after your duration, your business will become purely profitable.
Conclusion on Franchise Cost of Mcdonald’s in India
If you are having enough investment to start mcdonald’s business, and have the perfect location, then you don’t need to think twice before doing so.
You are supposed to get the readymade risk-free and branded business model in such an amount.
If you start your own business from scratch, you have to do different experiments, need to check what the customers like, what they don’t like, and ask for lots of money and time.
It’s not decided which of your experiments will succeed and which one will not.
Moreover, mcdonald’s itself is saying that one will become purely profitable in just two or three years, so that is giving a very good deal.
Is McDonald’s franchise profitable in India?
Yes, the mcdonald’s franchise business is a purely profitable business model in India.
According to Mcdonald’s, your business will become totally profitable after almost two to three years. It means the ROI of mcdonald’s is around two to three years.
Moreover, you don’t have to spend the money for advertising and marketing because all this stuff will be conducted by the company itself.
Next, you don’t have to work on the brand establishment, because Mcdonald’s is already an international brand so you can skip all this stuff which asks for lots of money, experiments, and time.
What is the franchise cost of Mcdonald’s in India?
Well, mcdonald’s is providing four types of franchises in India and the cost is starting from 6.6 crores to 14 crores, and you must have five crores rupees as a liquid investment for the upcoming expenses.