Following calls from international brands to pull out of Russia due to the Ukraine invasion;

Ramsey Baghdadi, Consumer Analyst at GlobalData, a leading data and analytics company, offers his view:

“Eyes are on big names like McDonald’s to withdraw from the Russian market, however, this is easier said than done for the fast-food industry. Russia represents approximately 0.7% of the global fast-food restaurants value in 2020. Such a small proportion of value generation in Russia tells us that fears of losing sales is not the main factor at play here.

“The challenge that foodservice providers have, which retail brands for instance do not, is the very nature of its business model. Fast-food chains such as McDonald’s and KFC often have complicated agreements with their outlets, as a large proportion of them are franchises and are not enterprises. So, it becomes a much more challenging negotiation to completely stop operations compared to other industries based on its business model alone.

“However, as 72%* of consumer purchases are driven by a brand’s ethics or support shown toward a social cause, it becomes difficult for these companies to balance consumer expectations and their operational needs, putting pressure on international fast-food restaurants.”

* GlobalData’s 2022 Q1 Consumer Survey, March 2022, ‘Essential’ and ‘Nice to have’ responses combined, 22,727 respondents