Burger chains getting a bigger bite in Tier 2 cities

Who said dine-in is a thing of the past? Quick service restaurant (QSR) brands like Burger Singh and Wat-a-Burger are busting that myth by rapidly adding outlets in Tier 2 cities, where dine-in is still strong.

In the past year, Burger Singh has grown its footprint from 23 outlets in 10 cities to 50 outlets in 20 cities. Further, it plans to open another 30 outlets by the end of this financial year, taking the total count to 80. Similarly, Wat-a-Burger plans to open 25 more outlets by March 2022. The brand currently has over 60 outlets across 21 cities.

Today, 80 per cent of Wat-a-Burger outlets are serving Tier 2 cities. So also about 70 per cent of Burger Singh outlets that have opened in the last one year.

Lower operating cost

“We seen that Tier 1 city stores gain 19 per cent more orders than average, but because we get a lot more dine-in orders in Tier 2 cities and the operating cost is lower, the latter sites are more profitable for us,” says Kabir Jeet Singh, CEO and Co-founder, Burger Singh.

According to Farman Beig, Co-founder and CEO of Wat-a-Burger, the margins in offline store sales are higher, as there are no commissions involved and there is decent discounting.

This is irrespective of the fact that online orders make up a larger portion of sales for both QSR chains. Beig notes, “Earlier it was a close call between online and offline sales. However, what we are currently experiencing is 60 per cent traction online alone, and the rest 40 per cent from offline sales.”

In the case of Burger Singh, the split between online and offline sales is 75 per cent online and 25 per cent offline.

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