Slowing sales at QSR – Will anybody look at the Quality angle ?

Last year I had written about how I am bored of the same menu at Barbeque Nation. “Why I don’t like Barbeque Nation anymore?  It invited many comments including one from a friend who said “I agree with this and in as many words”.

Last few months have seen leading publications in India, talk about the growing QSR (Quick Service Restaurants) segment and the entry of global chains like Taco Bell and Burger King.

At the same time, the articles are focusing on shrinking same store sales – a popular performance metric for the industry and how this is a cause of worry for the industry. While the blame typically goes on healthy eating, high inflation & margin pressures leading to decrease in items sold at lower costs (entry level items) & increase in costs, very little is being said and discussed about declining quality in food and drop in customer experience – which has led to customers shying away from QSR.

Sample this – a year ago I made a call to one of the stores of market leader in home delivery – Domino’s. A few pizzas and white pasta veg was my order. The lady at the other end repeated – “Red Pasta non veg” as if we were playing a game of opposites! Since then I have only placed orders on-line.Thankfully the website is user friendly and gives multiple informative updates, including when the delivery staff has left the store.

The case was not so simple in case of McDonalds. A particular store had such poorly trained staff – completely clueless about what was happening in the store. This led to long wait times post billing, unhygienic stores and most of the times half order being handed over and the rest being served on table. I registered a formal complaint with their regional HQ in Mumbai. They offered me a voucher which I did not use, since I did not feel like going to the store again.

I then ordered home delivery from the same store once, and mind you, one has to call their Mumbai number for this and they do not mention this in their advertisement making people believe they are calling a local number, the home delivery came after 50 minutes and had only half the order! I fail to understand why basic checks like matching the bill to contents in the bag was never done!

I again gave a piece of my mind but after seeing this happen regularly from one particular store – completely stopped going there and then slowly stopped visiting McDonalds. This is not the experience I want.

Third case is even more interesting that of Subway. They have a cruel way of joking, of asking you which bread would you want and later – “sorry sir, only hearty italian is available today“. Fine! Then why did you ask me for choice!

Subway has so much inconsistency that the same person preparing two subs at the same time can make it taste differently.

Not surprising that the three chains I quoted above are struggling to increase foothold in Indian market and at times registering negative growth in same store sales.

Two years ago I had written to Cafe Coffee Day – about how Cafe Frappe tastes differently at different stores and at times at the same store at different times of the day. I had received a call followed by en email detailing out how this point was discussed and sharing their long- term plan of improving supply chains and having food stuffs prepared centrally and training plan for having same taste for coffee. Today they have measures and charts at every store to ensure that the contents are same and in desired quantity and nothing is to be left to the employee to decide on how much of what goes into the coffee.

With applications like Zomato and Tripadvisor being downloaded on more and more smart phones and giving a very fair and user driven information, patrons are even more careful in choosing where to eat and visit. Students – who traditionally formed a cost sensitive segment and were driving numbers at QSR, now have enough exposure to look at quality and service and not just cost.

With menu same across stores at QSR, people rate a particular store based on experience and not food, unlike a Fine Dine restaurant where the review will be more about a particular dish and menu. People are already there for something they want to eat unlike a fine dine restaurant where they go and then explore.

A quick search on Zomato shows how the variation is in terms of ranking for subway in Pune – it varies from 2.3 to 3.8. Yet none of it is in top 50 or 100. For McDonalds it is similar 2.3 to 3.7 and for KFC – none of the stores go beyond 3.3, all of which is out of 5. The highest restaurant in Pune, incidentally is not a Fine Dine restaurant and is rated 4.9 of 5.

With experience levels going down, its time QSR look at social media analytics and have greater focus on customer touch points along with providing better training to their staff at call centre to improve on service,. While inflation, higher cost of living and margin pressures will drive away customers and are realistic reasons, the declining quality and sliding customer experience ratings and its impact on growth cannot be ignored.

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