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Monday, October 3, 2022

Taco Bell set to invest $100 million in pan-India expansion with 600 outlets

Taco Bell’s master franchise partner, Burman Hospitality, will invest over $100 million to fast-track its pan-India expansion plans. The quick-service restaurant (QSR) chain, with a presence across 19 cities, is set to open its 100th outlet later this month and plans to increase the number to 600 in the medium term.

Taco Bell is a unit of American restaurant major Yum Brands Inc. serving Mexican cuisine. “We are investing aggressively in new stores. We’re hoping to open (stores) every three to four days over the next few months. We’re investing obviously in headcount. We are 3,000 people now. We’re investing in the head office, we’re building a great team where we’re getting more and more people that understand the brand in India…our plan is to continue investing,” said Gaurav Burman, director, Burman Hospitality Pvt. Ltd, in an interview.

India is the fastest growing and among the largest markets outside the US and Canada, said Julie Masino, president of Taco Bell International, Yum Brands. “It’s among the largest. We have two other markets that have crossed the 100-store threshold. Spain crossed in December, and the UK will cross it next week…but India is the fastest growing, and we’re really excited about the partnership and all that we continue to do together (with Burman Hospitality),” Masino said.

In 2019, Burman Hospitality signed the master franchise agreement with Taco Bell India. Back then, it had set a target of opening 600 stores by 2029. It doubled its store count between October 2021 and August 2022, signalling a wider acceptance of its tacos and burritos in India.

The company continues to localize its menu and open outlets in tier II and III cities. The chain has also localized sourcing of raw material and worked on improving the supply chain, apart from building a brand presence across malls, high streets and food courts, said Burman. “We would have been even faster if covid hadn’t happened. Covid really set us back a bit, but I think we’re confident with the offering–the customers are enjoying the food. We feel we’ve got enough formats, so we can go into different areas in India. We are heading to tier II and tier III towns. I’m very confident we’ll get to 600 much faster than we originally planned,” Burman said on Monday.

QSR chains are rapidly expanding after the pandemic prompted consumers to shift to organized fast food chains. A June report by Yes Securities said the “exponential” growth trajectory for the quick service market in India was driven by a structural rise in consumer preference for online food ordering. The food services industry is set to clock a 15% CAGR, with organized QSR expected to grow at 23% CAGR over FY20-FY25, analysts said.

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