10,000 people are expect to lose their job in India as McDonald’s is shutting down 169 stores across the country. The popular restaurant is terminating a 23-year-old agreement it’s had with Connaught Plaza Restaurant. The bad news stems from a breach of franchise agreements. This of course is terrible news for India which already has a massive unemployment problem.
To get a better idea of how this will affect the people in India, keep in mind that each restaurant (depending on the size) hires between forty and sixty workers. Those are just in store worker, let’s not forget about the people who work in the corporate offices, the suppliers and the farmers who grow all the vegetables. This shutdown is going to put a lot of people in a financial tailspin.
McDonald’s, the company that has a strong presence in over 115 countries, has over 430 stores in India alone. Half of the corporations stores are ran by Connaught Plaza Restaurant in the North East and the other half is ran by Hardcastle Restaurants in the South West areas. The country is basically going to lose a chunk of their McDonald’s stores. McDonald’s India sent out a massive email telling people to hold tight while they smooth things out and look for a new partner.
McDonald’s and Connaught Plaza Restaurant has had their issues in the past. Connaught Plaza Restaurant had been revealed to have been misusing their supplied funds. Now they had breached an agreement by not getting the mandatory health licences for their stores. This just the excuse McDonald’s needed to separate themselves from them and it’s happening rapidly. 43 stores were already closed as of June.
Within fifteen days of the final termination notice, the once McDonald’s of India will no longer be able to use the chains logo, branding, trademarks or recipes. Surely these are chaotic times for McDonald’s India.