McDonald’s Signs Major Franchising Deal to Expand to Russia’s Siberia

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Moscow (hospitalitybusinessnews.com) McDonald’s will significantly expand its presence in Russia’s remote Siberian regions after the company signed the first big franchising deal in its 25-year history in the country, the Kommersant newspaper reported Friday.

Up to 20 McDonald’s franchises will be opened by 2016 in Siberia’s Kemerovo, Novosibirsk, Tomsk and Altai regions, the newspaper reported, citing Yevgeny Zenin, general director of the Inrusinvest development company that concluded the franchising agreement with McDonald’s.

The first restaurant will be opened in September in the Kemerovo region city of Novokuznetsk.

While 81 percent of McDonald’s restaurants around the world are operated by franchises, according to McDonald’s CEO Steve Easterbrook, in Russia the company chose to run all the restaurants itself for more than 20 years.

McDonald’s signed its first franchising deal in 2012 with Russian company Rosinter, which also develops international brands such as Costa Coffee and T.G.I. Friday’s in Russia, as well as Russian brands such as Planeta Sushi and Mama Rasha.

Under that agreement, Rosinter won the right to open McDonald’s outlets at railway stations and airports, but so far, only two branches have been opened by Rosinter — both of them located inside St. Petersburg’s Pulkovo Airport, according to McDonald’s.

In May this year, Easterbrook announced a plan to increase the share of restaurants operated by franchisees around the world to 90 percent, Bloomberg reported.

Of the Siberian regions earmarked for the outlets, only the city of Novosibirsk has existing McDonald’s outlets, making it the easternmost city in Russia where McDonald’s has a market presence.

McDonald’s chief executive in Russia, Khamzat Khasbulatov, unveiled plans to find a partner for the development of the chain in Siberia and the Kaliningrad region at the beginning of 2013.

McDonald’s has operated in Russia since 1990, when it opened its first eatery on Moscow’s Pushkin Square and 30,000 people famously stood in line for hours for their first taste of capitalism on its opening day. It now has 517 restaurants around the country, servicing more than a million people a day, according to the company’s website.

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