The US company has granted Grand Parade Investments (GPI) an exclusive agreement, which gives the South African group the franchise in the country. GPI plans to open its first Burger King in Cape Town, before opening more outlets. Some 90 per cent of Burger King’s network is operated through a franchisee model.
Jose Cil, the president of Burger King’s operations in Europe, the Middle East and Africa, said the company had studied the region closely with GPI and “now is the time to develop the brand in South Africa”.
Burger King is the second-largest fast-food hamburger chain in the world, serving around 11-million people daily from over 12 500 locations in 82 countries.
Burger King will find McDonald’s tough competition in South Africa. McDonald’s opened its first restaurant in the country in November 1995 and now operates 165 outlets in nine of South Africa’s provinces.
McDonald’s says South Africa is one of the most successful markets in its international history. It has invested more than $86 million into the South African economy and says it is committed to the success of the market.
Burger King signed an agreement earlier this year with the Kurdoglu family, which is already Burger King’s largest franchisee, and private equity firm Cartesian Capital with the aim of opening 1,000 restaurants in China over the next five to seven years. Burger King currently owns 63 outlets in China, while McDonald’s owns 1,400.
Burger King said, in addition to South Africa, it is committed to expansion in high-growth emerging markets, including Brazil, Turkey, the Middle East, India and other countries where it believes its penetration is low, relative to its potential.