McDonald's outlets set to double in Kingdom by 2020
MCTHAI Co, the local operator of McDonald's quick-service restaurants, plans to double the number of its stores to more than 400 by 2020, and to become one of the top three operators of McDonald's restaurants in Asean in terms of store count.
The expansion reflects the company’s strong belief in the growth of Thailand’s economy in the next five to 10 years, said Hester Chew, chairman of the executive committee and chief executive of McThai.
The company will budget more than Bt1 billion annually for its restaurant expansion over the next five years, he said.
He added that the company wanted to increase its annual sales by 20 per cent in each of the next five years, and to achieve annual sales of more than Bt10 billion by 2020, double this year’s estimate. Chew said that under the plan, the company would also double the total number of staff from 7,000 by the end of this year to more than 14,000 by 2020. McThai operates 208 McDonald’s restaurants throughout the Kingdom, of which 102 stores are in Bangkok and another 34 in the suburbs. About 61 are drive-through restaurants.
The company just opened the latest store last week in Suphan Buri province.
“We opened 20 new McDonald’s restaurants last year, of which more than 50 per cent are drive-through outlets,” Chew said.
He said about 30 new McDonald’s restaurants would be opened this year, of which half would be drive-throughs. Investment for traditional McDonald’s restaurants opened in shopping malls would be between Bt20 million and Bt30 million each, and up to about Bt40 million each for drive-throughs.
Open 24 hours a day, the drive-through outlets contribute 20-30 per cent more revenue than traditional restaurants. McDonald’s drive-through restaurants served about 3.5 million vehicles last year.
“We [McThai] have been in the McDonald’s business in Thailand for 30 years. We have set our vision towards 2020 by focusing on development of our people. We want to inspire our people to be the best and provide them a great place to work. We want to be the quick-service restaurant of choice to individual consumers,” Chew said.
Local franchisees
Operated by local franchisees, there are currently about 400 McDonald’s restaurants in the Philippines, 300 in Malaysia, 170 in Indonesia, and 130 in Singapore. The first McDonald’s restaurant in Vietnam just opened in February last year.
“We [McThai] are negotiating with the franchiser of McDonald’s restaurants in the US for opportunities to expand our franchise agreement beyond Thailand to other potential markets in the region, especially Myanmar. However, the franchiser wants to evaluate the feedback from Vietnam, which just opened its first McDonald’s store in the beginning of last year. It will take the next few years before any conclusion will be made,” Chew said. He said the company had also focused on the development of local menus at its McDonald’s restaurants over the past three to four years. Local menus now contribute about 10 per cent of its revenues.
“We will adapt ourselves to people’s lifestyles with the launch of many services, including home delivery and website ordering. We plan to launch a mobile application to target mobile-savvy customers by next month.”
McDonald’s first digital kiosk will be officially launched at Siam Paragon on Monday.
Chew said that amid the economic slowdown and political problems in Thailand, the company’s sales dropped by about 5 per cent last year compared with 2013. The overall Bt110-billion restaurant market, including quick-service outlets, in Thailand posted growth of only 2 per cent last year.
