Bloomberg: McDonald’s may leave Kazakhstan due to supply problems

McDonald’s may leave Kazakhstan due to disruption of supply chains and the inability to purchase meat in Russia, reported Bloomberg agency, citing sources.

The publication clarifies that after leaving the Russian market, McDonald’s banned its franchisees in Kazakhstan from buying meat for cutlets in Russia. 24 fast food restaurants owned by Food Solutions KZ LLP (McDonald’s Kazakhstan), suspended in November work due to supply problems.

December 12, 2022 National Chamber of Entrepreneurs of the Republic “Atameken” reportedthat Kazakh producers are ready to supply products for McDonald’s – this was reported following a meeting on problematic issues of the network with the participation of representatives of government agencies, business and national companies. “We plan to continue operating in the market of our country and are working to restore the work of restaurants. Our company is a major employer and we want to further develop the brand, which has recently entered the Kazakh market. The current geopolitical situations affect us as we are an international brand. Therefore, our goal is to continue our activities in accordance with all requirements and procedures and develop further,” said Aset Mashanov, General Director of Food Solutions KZ LLP, at this meeting.

According to Bloomberg sources, the franchisee was unable to purchase meat from local or European suppliers, as high prices and transportation costs would have led the business to operate at a loss.

Also, network problems in the country are exacerbated by the fact that McDonald’s franchisee in Kazakhstan Kairat Boranbaev was arrested on March 17, 2022 on charges of embezzlement in the quasi-public sector. About it informed Interfax with reference to the statement of the Financial Monitoring Agency of Kazakhstan.

Against the backdrop of the start of a special operation in Ukraine, on March 14, McDonald’s closed its restaurants in Russia, and on May 16 announced its final withdrawal from the country. As a result, the Russian business of McDonald’s was sold to local licensee Alexander Govor. The company reserved the opportunity to buy back the business within 15 years, Govor said in an interview with Vedomosti. On June 12, the first 15 restaurants of the former McDonald’s reopened in Russia under the Vkusno-i Tochka brand. And on November 21, the restaurant chain launched delivery in several cities of the Russian Federation.

Also at the beginning of November knownthat McDonald’s restaurants in Belarus will also be transferred under the Russian brand “Vkusno – i dot”.