What's not to love about McDonald's shutting down 80% outlets in Delhi?
In what will come as welcome news for those watching their cholesterol levels in the national capital, popular fast food chain McDonald's has decided to shut down majority of its outlets in Delhi. The US-based fast food chain which operates outlets of the popular burger joint will soon shut down, at least for now, 43 out of 55 restaurants in the city.
The shock decision will leave 1,700 workers jobless, however, according to an HT report they will be compensated till the time the restaurants are not operational again. "We understand that CPRL is retaining the employees of affected restaurants and will pay them their salary during the period of suspension."
Why the shutdown
In a statement issued, the McDonald's explained, “The ‘eating house licenses’ of a number of McDonald’s restaurants in Delhi have expired. The board of Connaught Plaza Restaurants Private Limited (or “CPRL”, McDonald’s licensee in North and East India) is working to obtain the required licenses. Pending this, CPRL is temporarily suspending the operations of the affected restaurant."
However, media reports suggest the outlets are shutting down because of falling revenues, lack of investment and a tussle between the north Indian franchisee and the global food giant.
Vikram Bakshi– former managing director of CRPL – and McDonald’s have for a while remained locked in a long-drawn legal battle for control over the outlets which currently operate in partnership between CRPL and the US-headquartered McDonald's.
Shutdown of Mcdonald's a good news
Though some outlets will remain open across the city, the move to shut down as many as 43 restaurants is sure to have an adverse impact on the revenues and already declining popularity of the burger giant in the National Capital Region (NCR). This is understandably sad news as it could end up being the beginning of the end for McDonald's, which not only introduced many in India to burgers, but over the years evolved into a chain providing affordable fast food to its customers.
But, the sorry decline of this giant could turn out to be good news for a city finding it hard to tackle the menace of unhealthy junk food – a problem that Mcdonald's has only helped aggravate.
It's no secret that the outlets run by McDonald's in the city are often blamed for not maintaining very high standards of hygiene and the quality of food served has also declined over the years. A report published in Business Standard claims that highly placed sources in the firm have confessed that "maintaining hygiene and store-level efficiency became a major headache since 2014 as indecisiveness hampered day-to-day operations."
However, detrimental to the future of the fast-food chain, McDonald's failing to renew their food licence and as a result closing 80 per cent of the stores in the city could really turn out to be a blessing in disguise for residents of Delhi.