After Delhi, McDonald’s May Shutter All Its 169 Outlets In North & East India! [UPDATED]

Updated on 22 August 2017

It sure is a dark day in the history of fast food in India as McDonald’s India Pvt. Ltd (MIPL) has terminated its franchise agreement with Connaught Plaza Restaurants Pvt. Ltd (CPRL). CPRL was responsible for all McD outlets in North and East India.

Following the unfortunate dissolution, CPRL will have to “cease using the McDonald’s system (which includes proprietary rights in McDonald’s names, trademarks, designs, branding, operational and marketing practice and policies, and food recipes and specifications) and its associated intellectual property in relation to these restaurants within 15 days of the termination notice”, quotes Hindustan Times.

“The termination is a result of a breach, a violation of certain essential obligations that were a part of the agreement typically the default of payment of royalties to MIPL for two years. CPRL was notified of the breaches and was provided opportunity to remedy those; it had failed to do so,” said Ron Christianson, global head of corporate relations, foundational markets, at McDonald’s Corp.

So does this mean we’ll have to flock elsewhere for our share of yummy junk? Temporarily, yes but not immediately. While a lot of outlets continue to function still, they may soon face closure. But the chain is looking for a new licensee partner and promises to “rebuild a stronger McDonald’s”.

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You know it’s Monday when one of your favourite fast food chains threatens to remove any trace that it may have in your neighbourhood, city, and your half of the country! Because that is exactly what’s happening.

Following the unfortunate fallout between the McDonalds’ Indian representative McDonald’s India Private Limited (MIPL) and Vikram Bakshi headed Connaught Plaza Restaurants Ltd (CPRL), that led to almost 80 per cent of Delhi’s McD outlets to close their doors, the American fast food giant may well terminate its franchise agreement and pull out of the North and East regions of India.

If executed, the termination notice will prohibit CRPL from using any intellectual properties of McDonald’s at the 169 outlets across North and East India within 15 days of its implementation.

The drastic step would obviously also mean a lack of those delicious burgers and gorgeous golden fries in our lives, but on a more dismal note it means a loss of over thousands of people who have been employed by the chain, while a loss of crores of rupees is also anticipated as supplier contracts are also at a risk of being terminated.

Image: McDonald’s 

“We have been compelled to take this step because CPRL has materially breached the terms of the respective franchise agreements relating to the affected restaurants, and has failed to remedy the breaches, despite being provided with an opportunity to do so in accordance with the agreements,” a statement McDonald’s read.

However, McDonald’s added that it is “committed to finding the right ‘developmental licensee partner’ for North and East India and taking steps to do so”.

That said, the future of our burger and fried is in the doldrums and we can only pray that a common consensus – sans any outlet shuttering – is reached!

Feature Image: Chicago Tribune