People need quality food, not mere brands


International food-chain left Russia after running businesses for over 31 years with 850 outlets and 62,000 employees, while now local businessman Alexander Govor has already started necessary preparation for resuming activities of the food outlet giving it a new logo and name. Earlier, McDonald’s sold its business in Russia to Govor who already runs 25 of the fast-food chain’s restaurants in Siberia. According to media reports, Alexander Govor has also agreed to pay the salaries of all McDonald’s corporate staff in Russia until closing and fund existing liabilities to suppliers, landlords, and utility companies.

Govor and McDonald’s didn’t disclose any of the deal’s financials. The company said that it would take a non-cash charge of about US$1.2 billion to US$1.4 billion as a result of its exit from Russia. The burger chain grew its business to nearly 850 locations in Russia after it opened its first outlet in the country in Moscow’s Pushkin Square in 1990. Before its pullout, McDonald’s owned around 84 percent of its restaurants in the country. Govor ran his licensed McDonald’s branches through a company he owns called GiD LLC, which is described as being part of the restaurant industry.

According to Reuters, Govor is also listed as a co-owner of a rental company called Siberian Distribution Centre and the Anzherkiy Oil refinery. Govor also has stakes in a small forestry company and a fishing and hunting company, the outlet reported, citing the Interfax news agency’s Spark database.

Media reports said, the new logo of rebranded McDonald outlets in Russia shows a red-orange circle and two orange lines against a green background, the image represents two sticks of yellow fried potatoes and a yellow-orange burger.

McDonald’s new owner has not yet decided on a new brand name, a spokesperson for the company, the Sistema PBO, told the state-run TASS news agency.

Two of the eight names under consideration are “Tot Samyi”, which translates as “The Same” or “That One” and “Svobodnaya Kassa” (Available Cash Register), according to a report by The Moscow Times.

The relaunch of the chain is expected to begin on June 12 when the country celebrates Russia Day, a holiday marking the country’s independence, at the same flagship location in Moscow’s Pushkin Square where McDonald’s first opened in Russia in January 1990.

Here is my question. With over 850 outlets just in Russia, how much money McDonald’s was making every month, while their investment in that massive business was zero. Instead, McDonald’s was making money simply by selling its so-called goodwill and brand name. Any reason why people continue mad rush buying food from McDonald’s or other international food chains, such as KFC or Pizza Hut? What specialty they really have in comparing to local brands? In my opinion – nothing! Nothing at all! These are all a kind of psychological brain-washing. When people go to these so-called global brand outlets, they start believing – they are buying extreme yummy food. That is all act of mindset. In medical science, there is a word called placebo effect. In this case too, people are simply hypnotized with the “placebo effect” thinking McDonald or those international brands are “special” or “incomparable”. Nothing else.

In Bangladesh, for example, while there are Pizza Hut outlets, a large number of local companies are also selling pizzas under different brand names. Let’s just take our pizzas manufactured by Pizza Hut and other local brands from the packing boxes and serve these to anyone without mentioning which one is from Pizza Hut. No one will be able to identify. Instead, in most cases, people may consider a local brand pizza as a product from Pizza Hut.

By exiting from a massive market in Russia, McDonald’s actually has lost a huge business opportunity. Now let us hope – Russian entrepreneur Alexander Govor will not only succeed in resuming operations of the 850 outlets with his new brand name, he also will onwards expand this very Russian food chain into other countries in the world – including China, India, Singapore, Thailand, Vietnam, Malaysia, Indonesia, Philippines, Bangladesh, and the Middle Eastern countries and beyond.


Please enter your comment!
Please enter your name here