Why are big QSR brands like Westlife losing their edge?

Big QSR brands are losing their edge due to the rise of food apps empowering local players, which squeezes margins and slows growth.

How are food apps changing the restaurant market?

Food apps are enabling local restaurants to gain prominence, challenging the market share and profitability of larger QSR chains.

Who controls the customer in the Indian food market now?

Customer control is shifting as food apps give more power to local eateries, diminishing the traditional advantage of large QSR brands.

Home / Business and Economy / QSRs Lose Grip: Who Owns the Customer Now?

QSRs Lose Grip: Who Owns the Customer Now?

18 Dec

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Summary

Big QSR brands are seeing stock declines.
Food apps empower local players, shrinking margins.
Customer control is shifting away from large brands.

QSRs Lose Grip: Who Owns the Customer Now?

The dominance of major Quick Service Restaurant (QSR) brands is facing a significant challenge. Stocks for prominent QSR companies like Westlife and Jubilant have seen declines, even as their market valuations remain elevated. This downturn suggests a shift in market power, with scale no longer being a guarantee of success.

The rise of food delivery applications is a key factor in this transformation. These platforms are increasingly empowering smaller, local food businesses, which in turn is leading to reduced profit margins for larger chains. Growth rates for these established brands have slowed considerably, now often in the single digits.

The evolving market dynamics raise a critical question: who truly holds sway over the customer's choice? The traditional belief that popularity equates to stock performance, as espoused by investors like Peter Lynch, is being tested in India's restaurant sector. This period marks a substantial reshaping of the food market.