Individual Project Assignment: Burger King’s Development in France

Individual Project assignment: Burger King’s development in France

Burger King, American global chain of hamburger fast food restaurants decides to leave the French market in 1997 after it became a victim of the ruthless competition between Quick and McDonald’s. Quick Restaurants Group, which is one of the largest fast food restaurant chains, has more than 500 restaurants in France, Luxembourg, Belgium, and other countries outside Europe. In 2014 only, Quick restaurants served more than 200 millions customers according to Forbes and generate system-wide-sales of 1.0 billion. According to its strategy to expand internationally in highly lucrative markets, in 2013, Burger King returns to France with an idea: step up competition against the two principal leaders in French fast food, McDonald’s and Quick. When they opened an outlet in the Gare Saint-Lazare in Paris, the news went viral and quickly people waited for hours to get a Whooper. Same crowed situations in others French cities.

Burger King envy to enter the French market is due to an increasing appetite for fast-food restaurants in the recent years with high demand for burgers especially. Indeed, the Financial Times states a report from consultancy group Gira Conseil which showed there were 970m burgers sold in France in 2013, representing half of the sandwiches sold. Following there standardized Global Marketing Strategy, Burger King has currently 25 restaurants in different regions of France and they posted roughly €100 million revenues in 2014 according to Forbes.  

Burger King is now interested in expanding its reach in France. In order to boost their long-term goal of international restaurant growth, Burger King signed an offer letter with Qualium Investment, owner of Quick Group, for the acquisition of the Quick hamburger fast food chain. The acquisition aims at converting the Quick restaurants in France to Burger King restaurants and gaining market share. When the contract will be effective, Restaurant Brand International, the parent company of Burger King and Tim Hortons, is going to be the second largest fast food chain restaurant behind McDonald’s, which has more than 1,300 restaurants in the country.  In the Financial Time, Daniel Schwartz, chief executive of Restaurant Brand International, owner of Burger King, commented: “The transaction will significantly accelerate our Burger King restaurant growth in France, a key strategic market,” Indeed, France represent one of the key strategic markets for the brand with average annual sales of approximately €5 million from its existing Burger King restaurants in the country over the past two years. According to Restaurant Brands International, this deal will translate to more than 500 Burger King Restaurants in France with combined sales of roughly €1 billion.

Burger King is using a similar management perspective as McDonald’s. McDonald’s in France is adapting its burgers and menus for the French consumer. Burger King is using a polycentric orientation also. The French market is getting Americanized and that is what Burger King is offering. Indeed, the strategy to sell an existing product in a new market (market development strategy) is for Burger King an opportunity they can’t miss. According to Forbes, France is in the way of becoming “one of the fastest growing markets and a core international market for the company.” Trefis, a consulting company, estimates the number of Burger King franchised restaurants to increase by 700 in 2015, taking the total count to more than 15,000.