What's Next for QSRs in India

FOOD INDUSTRY is no doubt booming at a fast rate, giving due credits to the rising disposable income of the middle class. Speaking specifically about the Quick Service Restaurants (QSRs) like Pizza Hut, Burger King, McDonald’s, Burger Singh, etc that is growing exponentially in the recent times. According to a last year report by KPMG in association with FICCI on ‘India’s food service industry: Growth Recipe’, the food service industry in India can broadly be classified into four major segments, wherein Full-service Restaurants and Quick Service Restaurants (QSRs) together account for around 73 percent, rest 14.6 percent being street kiosk desks and remaining 12.5 percent being bars and cafes.

Two mega metros, Mumbai and Delhi NCR contribute to 22 percent of the overall Food Services market (11 percent each) followed by six mini metros comprising of 20 percent share in the Food Services market basis the FICCI report on Indian Food Services.“As more and more chains mushroom across multiple regions and franchising being seen as a viable option by a larger segment of the population, the QSR segment has seen considerable changes in the past one year,” says M. Yeshwanth Nag, Founder of The ThickShake Factory.

According to Nag, QSRs are what the modern Indian prefers, as life gets faster and time more precious, consumers need their product created and supplied faster with articulate presentation and perfect taste. “We can see QSRs moving to tier 2 or tier 3 cities more and more in the next few months as more and more players realise the potential for these areas,” he adds.

Urbanisation,youth spending, nuclear families and improved logistics can be a major catalyst to penetrate QSR segment in various parts of India. Also, about 50 percent of India’s population tends to eat out frequently which brings India to a very close proximity to developed QSR spaces across the globe.  “Technology will surely play a major role and will be able to cater to different customer segments and help in knowing their taste and preferences. The CRM will be more well defined and will help us tapping new customers along with allowing us to bring back our old customers by giving lucrative discounts and promotions as well,” feels Nitika Kapur, CEO of Nukkadwala about the future potentials in QSR segment.

One of a very interesting trend in QSR segment noticed by Kapur is the shift of serving Indian authentic regional delicacies drifting away from serving western cuisine. The need for the hour is for the suppliers and QSRs to innovate together. To make the business models work, a good balance between the right prices, acceptable transactions on a weekly basis and most importantly ensuring a right supply chain is crucial.

Seeing the potential in Indian market, the traffic to enter the Indian market has increased. "The QSR segment is one of the most exciting segments in the F&B industry today. People are opting for quick, casual and value for money meals and QSRs offer exactly that. For our Japanese QSR we have experienced over 200 percent growth in the last two years,” said Hakuei Kosato the founder and Managing Director of Sushi and More India Pvt Ltd. The company announced their plans to open more Sushi kitchens and also launched their new QSR brand “The Don” in Mumbai recently.With the big brands building up, the small brands are also expected to rocket their operations and sales in the next few years to provide their share in the growth spectrum of the whole QSR segment.