Burger King Playing Catch-Up In South African Fast Food

Burger King Playing Catch-Up In South African Fast Food

Forty-two years after Kentucky Fried Chicken started operating in Africa’s biggest economy and 18 years after McDonald’s entered the South African fast food market, Burger King opened its first restaurant in Cape Town in May.

Now the home of the Whopper plans to expand with 12 new Burger King branches in South Africa in 2014, said Jaye Sinclair, CEO of Burger King South Africa, according to a report in Bloomberg News. After that, Burger King wants to grow into other African countries.

In South Africa, the Whopper sells for about $2.39 compared with $2.29 for McDonald’s Big Mac, the report said.

Facing tough competition at home in the U.S. market, Burger King is expanding into other new countries. It has been selling burgers in Russia since 2010 and plans to open 1,000 locations in China, according to Bloomberg News.

McDonald’s has 170 branches in South Africa and KFC has 600-plus stores. Burger King is way behind, says Daniel Schwartz, who was named CEO of the Miami-based company June 7, in charge of a strategy focused on international expansion.

Burger King was taken private by New York investment firm 3G Capital Inc. in 2010 and re-listed on the stock market in 2012, according to the report.

Burger King plans initially to open outlets in Botswana, Mauritius, Mozambique, Namibia, Zimbabwe and Zambia.

“South Africa is to be a springboard into Africa,” Sinclair said in the report. “There is double-digit growth in many of these economies, so you want to be there.”

South African consumers love fast food, giving it a customer satisfaction high score of 79 out of 100‚ according to the South African Customer Satisfaction Index, as reported in eNewsChannelSouthAfrica.

“There is very little differentiation between the fast food outlets in the eyes of their customers‚” said Adré Schreuder‚ founder and chairman of the index.

South Africa’s fast food industry ranked second in the world relative to international American Customer Satisfaction Index scores‚ with the U.S., which serves as the international benchmark, scoring 80 out of 100, the report said.

But the report warned that South African consumers are becoming savvier and their expectations are rising when it comes to fast food. They’re getting used to “deliberately” large portions at prices that appeal to a desire for value for money, according to eNewsChannelSouthAfrica.