Tuesday, October 18, 2016

A Passage to India: Elevation Burger and Mooyah Take the Plunge

Both concepts are planning their expansion into India where McDonald’s and other burger chains are already established. What sets these newcomers apart is their focus on high end products. Elevation sells organic burgers and Mooyah prepares all pates fresh in the store.
Both brands have been operating for about ten years and have been offering franchises in the United States since 2007 (Mooyah) and 2008 (Elevation), respectively. The initial investment for an Elevation Burger restaurant in the United States is an average $554,000 while investors in a Mooyah need to bring an average $415,000 to the table.

The average restaurant revenues for a Mooyah are close to $800,000 a year with an EBITDA margin of 13.4%. The average Elevation Burger locations generates just over $1 million a year.
Both brands managed sustainable fast growth in the United States. Between 2009 and 2015, franchised Elevation Burger restaurants grew at a compound annual growth rate (CAGR) of almost 50% with an average annual continuity rate of 95%. Mooyah’s franchised locations increased at an estimated CAGR of around 30% with a slightly lower average annual continuity rate of just under 90%.

Elevation Burger operates over 55 restaurants worldwide with 22 located in the United States. Mooyah, on the other hand, has about 100 locations, also with around 20 abroad. Both concepts appear to follow a similar international expansion strategy. Outside the United States, they initially opened restaurants in neighboring Canada and/or Mexico and then went straight to the Middle East. From there, they are now eying India.
It will be interesting to see how either one of them will adjust to customer preferences in India. Most QSR brands have added chicken and or vegetarian meals to their menu to cater to the predominantly Hindu population.
Let’s see which one of them will be ready to conquer Europe first.


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