Mukesh Ambani has a solution to the chicken-and-egg dilemma and it is going to shake up the Indian quick service restaurant market completely.
According to a report in The Times of India, Ambani's Reliance Industries, through its subsidiary Reliance Retail, has picked up a 45 percent stake in 2 Sisters Food India, a subsidiary of UK-based 2 Sisters Food Group Ltd (2SFG).
The company plans to open a quick service restaurant chain in India which will exclusively sell chicken products. The name of the restaurant is Chicken came First.
The UK company, founded and owned by Ranjit Singh Boparan, is primarily a chicken products company. It supplies its products to retail, food service, and food manufacturing sectors in Europe, according to Bloomberg Buisnessweek.
Founded in 1993, the company is based in West Bromwich, the UK, and has facilities in the UK, Holland, and Poland.
2SFG India will initially introduce Chicken came First through Reliance Retail which will start selling chilled and frozen foods under this brand. The retail of India's biggest conglomerate had signed a back-end joint venture with 2SFG India in 2012.
Chicken came First will step up the competition the in Rs 7,000 crore organised food services market in India and directly compete with Kentucky Fried Chicken.
It is significant that RIL's foray into the fast foods market comes at a time when an economic slowdown and resultant job cuts is forcing the Indian middle class to squeeze its discretionary spends.
However, the company's interest in the segment shows its long-term potential.
The organised foods market, according to the ToI report, is growing 30 percent annually and global brands enjoy 63 percent of this market.
Elsewhere in the same newspaper, David Novak, chairman and CEO of Yum! Brands exudes confidence that India will be a major market for the company in a few years. Yum! owns KFC, Taco Bell and Pizza Hut brands of fast food chains.
"We know there is a population of a billion people, which is going to become the largest consuming economy in the world - some day. So, we need to stay the course and build our brands," he has told the newspaper.
The company plans to invest $100 million in India in three-four years and $10 billion emerging markets by 2020.
The company has opened its 40,000th restaurant in Goa.
(Disclosure: The Reliance Group has funded the promoter of Network18, which publishes Firstpost)
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Updated Date: Dec 20, 2014 23:36:46 IST