The American fast food chain Burger King is taking aim at the Italian market, planning an investment of €340 million to open 373 new restaurants in five years.
After years of moderated growth, the American giant has found the right financial means in order to make the leap in markets where it does not play a leading role. Last year it created a joint venture called BK SEE (Burger King South Europe East) to fund its European expansion.
The target countries are Italy, Poland, Romania, and Greece. Burger King is the second biggest fast-food chain in the world, with 14,000 restaurants in 100 countries. In Italy, it aims to reach 500 sales points with direct employment of 5,000 workers and just as many indirect hires.
“Until now in Italy, development has proceeded slowly because the leadership of the direct management of the brand was missing,” said Joaquìn Salvo Puebla, general manager of BK restaurants Italia. “With the inauguration of the restaurant in San Martino Siccomario (Pavia, Ed.) we opened the first restaurant under direct management, which will be the most common format for the next five years.”
Eating out has been affected by the crisis: according to the food service research group NPD, spending has fallen by €2 billion euros over three years: dropping by 2.4% to €60.5 billion in 2013 and by 2% to €59.25 billion in 2014.
Fast food chains, however, have suddenly decided to accelerate development in Italy or to begin market penetration.
McDonald’s, which is struggling in the US and throughout the world, considers Italy one of the strategic markets, aiming to increase their presence from 512 restaurants to 800; the American Kentucky Fried Chicken just opened 2 restaurants in Rome and Turin and is signing the lease for a restaurant in Milan; in the province of Varese, the American luxury fast food chain Fuddruckers opened two locations; the Italian chains Roadhouse grill and Old wild west (with distinctive table service) open new restaurants at the rate of 15-20 a year.
In Italy, the 127 Burger King restaurants turnover between €1 and €1.5 million each, and employ 2,500 workers.
“We have an aggressive development strategy,” admits Puebla, “but it proceeds step by step: in the next three-year period we will double our commercial network.”
The success of McDonald’s in Italy (though after struggling for years) was also helped by the “Italianization” of the menu.
Will Burger King follow in its footsteps?
“Our strengths,” responds Puebla, “are grilled meat and the preparation of our food in real time. Even Burger King offers sandwiches with parmigiano reggiano or Philadelphia cream cheese, but we will increase the presence of Italian products.”
Burger King’s development will be focused on the North Central Italy.
“In the South, we will focus on franchising,” said Massimo Barbieri, Bksee director of development and ex-franchising director of McDonald’s Italia.
The capital for aspiring franchise entrepreneurs is “40% of the €800-900,000 needed to start a restaurant,” he said.