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Jul, 11 2017

GST would help add new stores in non-metro places: Hardcastle Cafe

The company has brought uniform price by slashing price in southern states where pre-GST taxes were high and by hiking rates in states like Maharashtra.

Hardcastle Restaurants, the franchisee of McDonald's for west and south India operations, said the GST would increase the operational efficiency and help it add new stores in non-metro places.

The company, which now operates around 260 McDonald's restaurants, would have a uniform price across all states in southern and western regions post GST.

Amit Jatia, Vice Chairman, Hardcastle Restaurants, said, "The state borders are now going away slowly and this would increase our operational efficiency, which will help us as well."

Now, a single truck carrying supplies could cater 2-3 states in one trip, earlier it was restricted to one particular states due to tax differences.

The company has brought uniform price by slashing price in southern states where pre-GST taxes were high and by hiking rates in states like Maharashtra.

Jatia added, "In southern states where the prices were more than 18 per cent, our burger prices have come down and some states where the taxes were lower than 18 per cent, the rates have slightly gone up."

States like Karnataka had 21 per cent tax under VAT regime while Maharashtra had 14 per cent and all have now come to 18 per cent.

He said, "It is a huge advantage from retail point of view."

On being asked that the margins of stores located in metro and tier II & III places would be different, Jatia said, "Yes, there are. But by giving a constant price to our consumers is useful although efficiency cost would be different in state to state".

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