Drive-Thru Restaurant Business in India
Would you ever start a drive-thru restaurant business in India?
It won’t be an easy decision for the Restaurateurs and entrepreneurs out there.
I have thought about the same several times, but couldn’t come up with a justifiable solution.
Is it because the people are happy or content with the conventional restaurant system? Or, are there any underlying issues?
Since, the topic sparked interest in me, I decided to conduct a bit of research regarding the same.
Dear folks, it’s a combination of factors that contribute towards the reduced acceptance for drive-thrus in India.
But, it’s not that drive-thru concepts won’t thrive in India, at all.
Read on to understand more.
What is a drive-thru restaurant?
A Drive-thru restaurant is a food service facility, just like any other restaurant, but it allows customers place their orders, make payment and collect food while sitting in the comfort of their vehicles.
The drive-thru restaurant concept is widely employed by fast food chains all across the globe. Even many casual eatery outlets operate in the drive-thru format, focusing on the convenience and profitability aspects. Some of the major, well-known fast foods that provide drive thru facility are:
- McDonald’s – regarded as pioneers of drive-thrus
- Burger King – known for the flame-grilled burger
- KFC – popular for fried chicken meals.
- Taco Bell – well-known for Mexican dishes
- Starbucks – well-known for coffee and beverages.
Key challenges to consider
If you are planning to set up a drive-thru restaurant business in India, you’ve got to deal with certain key challenges. And here they are:
- Traffic congestion – If you are caught up in a traffic block or congestion, getting into a drive-thru lane could be a challenging task. In peak hours, you might have to wait for a considerable period of time, maybe hours!
- High real-estate cost – Real estate prices in tier-1 and tier-2 cities of India is way too high for ordinary restaurants to afford. Having a prime location with a reasonable access to 4-wheelers is a must for drive-thru QSRs.
- Complex norms, permits and regulations – The access to the drive-thru lanes, other local laws & regulations, permit-related matters – navigating these complex formalities could be a daunting task. Moreover, permits vary with States and municipalities which makes things more complicated.
- High Competition – Indians already have roadside eating outlets in the form of “dhaba”, local QSRs, and even roadside vendors that sell snacks like bhel, pakodi, samosa etc. Parking is not an issue at these eating outlets as some of them offer regular parking. Even on many National Highways, roadside parking for few minutes won’t be much of an issue.
- Cultural and behavioral barriers – the concept of drive-thru is still at the infancy stage in India. A good majority of Indians prefer to dine in traditional restaurants.
- Limited, simplified menu in drive-thrus – Most drive-thrus offer a simplified menu for the ease of ordering and speedy serving. This may not satisfy the diverse tast and preferences of the Indian audience.
- Family customers – Family customers often prefer dining in traditional eateries rather than trying out an on-the-go experience. They like to spend time, chat with each other and take their time to order their preferred dishes.
Still there is hope!
Even if there are certain challenges, there is certainly a ray of hope for QSRs.
- The growing number of car owners – According to CEEW (Council on Energy, Environment, and Water) report, private car ownership in India is expected to rise by 2.7 times, in the timespan of 2023 to 2050. This means, an increase in number of cars from 32 million units to 90 million units. Even the used car industry is thriving in India!
- The rise of Tier 2 and Tier 3 cities – Infrastructure development activities are taking place at a fast pace in both Tier 2 and Tier 3 cities of India. This is favourable for drive-thrus in India.
- Working millennials and GenZs – the millennial and GenZ populations play an Integral role in the Indian economy as they are influential in shaping consumer trends. They own cars, have spending power, are part of the working population, and enjoy traveling on weekends. They embrace on-the-go, fast-food experiences unlike other populations.
- Expanding QSR market – India’s QSR industry is witnessing growth at a fast pace. Adding automated drive-thru experiences would really add value to the existing fast-food ventures.
Benefits of a drive-thru restaurant
Here are some of the major benefits of having a drive-thru setup.
- Drive-thru convenience for customers – the customers need not park their vehicles or enter a physical restaurant, and wait for the tables to clear. They need not even get out of their cars.
- The self-ordering drive-thru facility helps customers who are in a hurry, or have children or experience mobility issues.
- Quick, on-the-go service – Drive-thru lanes are known for their quick service – place your order, make the payment, collect the dish, and press the pedal! All these processes take place in a few minutes.
- Improved revenue generation – The quick ordering and collection process helps restaurants serve a greater number of customers in the peak hours. Large display menu boards installed at the drive-thru lanes help customers easily browse through the menu and order their favourite dish without any confusion.
- Voice-ordering facility at drive-thrus – Voice-enabled ordering further improves the speed of ordering and reduces the staff number at the order-taking window. Voice-ordering also helps customers with disabilities place their orders sitting inside the comfort of their cars, and hence an Accessibility-friendly feature.
- Improved operational efficiency – No waiting lines, no waiting for table clearance, quick order-processing and delivery – all these factors enhance restaurants’ operational efficiency.
- Improved customer reach – Most of the drive-thrus are located in major highways that connect important cities. Drive-thru outlets are highly accessible for commuting customers, tourists, and busy professionals who prefer an on-the-go dining experience.
- 24/7 dining experience – A drive-thru facility can offer 24/7 dining experience for the customers.
- Satisfied, loyal customers – If you could offer yummy food with reliable services, you can expect a lot of loyal customers that become your restaurant ambassadors.
McDonald’s Airport Drive-thru restaurant in Mumbai
The world-renowned QSR giant McDonald’s has recently set up, first of its kind airport drive-thru restaurant near the T2 terminal of the renowned Chhatrapati Shivaji Maharaj International Airport, Mumbai. The drive-thru is located within walkable distance from the airport making it highly beneficial for airport passengers, tourists and even the local residents.
And, of course it operates 24/7.
The drive-thru complex comprises of a drive-thru lane, Customer Ordering Display (COD), takeaway counter, and an indoor dinging area. The customers can conveniently drive their cars to the drive-thru lane, make their orders, perform the payment and proceed towards the takeaway counter to grab their favourite McDonald’s meal. For an indoor ordering experience, the restaurant has deployed 6-7 self-ordering kiosk machines.
Be it a McAloo Tikki or McChicken, the customers can enjoy a seamless, on-the-go food-ordering experience at Mumbai’s McDonald’s drive-thru.
ANI reports that around 30 to 35% of the McDonald’s outlets planning to start their operations in the next 5 years, in India, would be of the drive-thru type.
The report also mentions that the QSR giant is planning to start outlets all across major Indian city suburbs and prominent highways, as part of business expansion.
In order to understand the inside tech of McDonald’s, please visit our McDonald’s drive-thru blog published on our website.
Success factors for drive-thru restaurants in India
If you are planning to start a drive-thru restaurant in India, here are certain key considerations to keep in mind.
- Locations with a reasonable traffic flow – Figure out locations that have a reasonable flow of traffic, preferably in the city suburbs having access to State or National Highways. To add on, finding location in the suburbs helps to bring down real estate prices.
- Congestion-free roads – Congested roads slow down traffic causing vehicles to slow down, making it difficult for vehicles to enter and exit the facility.
- Drive-thru restaurant design – If you already own a traditional dine-in facility, you may consider adding a drive-thru lane for the on-the-go diners. This does not require much space consideration, you only have to plan or design the premises that accommodate drive-thru facilities. Additionally, this helps to cater to the needs of the large, multicultural, diverse Indian customers. Those who prefer a drive-thru experience may use it, or else, those customers with families may choose the conventional dining experience. Combining the benefits of both worlds gives them options to what to choose, when!
- Proximity to economic zones or IT hubs – Economic hubs and IT hubs are ideal locations to start a drive-thru restaurant, as these regions have a good number of commuting professionals. The busy corporate culture, and 24/7 work-related commutes would keep those busy professionals glued to the drive-thru culture.
- Smart cities – The Smart City mission has selected more than 100 cities in India as part of implementing its economic development and infrastructure development initiatives. Smart cities leverage technology and the use of sustainable growth strategies to meet their development goals. Drive-thru setups can easily blend with the concept of smart cities, as they are technology-assisted, and offer fast and convenient services.
- Malls and other entertainment facilities – Most of the Indian malls are frequently visited by movie-goers, and entertainment-enthusiasts. Having drive-thru restaurants near to these entertainment centers can attract mall visitors, movie goers, etc.
- Proximity to healthcare institutions or hospitals – Drive-thru facilities can be implemented near hospitals or inside the hospital complex as these facilities provide fast, contactless experiences to patients, visitors and hospital staff.
- Renowned tourist destinations – Proximity to popular tourist destinations that are accessible to roadways can attract customers who prefer drive-thru experiences.
- Proximity to airports – Drives thru restaurants located close to International Airport terminals can attract airport passengers and tourists. The proximity of McDonald’s drive-thru to the T2 terminal of the CSMIA airport (discussed above) is an excellent example of leveraging the presence of an airport.
Conclusion
As far as I feel, the next decade is sure to witness the mushrooming of several drive-thru restaurant businesses in India. The tech-savvy, working population of India would be the major contributor to revenue in these drive-thrus.
Combining the benefits of a drive-thru and conventional eatery outlet could be an exciting move, particularly for the Indian market.
The diverse Indian market would appreciate the option to choose from a wide range of dishes as they are picky. It’s just a matter of time for the Indian population to “acclimatise” with the drive-thru culture.
For anything related to starting a drive-thru restaurant business in India, please get in touch with our restaurant advisors.
