McDonald's Corp. pretty much created the market for fast food in Russia, but now it's finding itself under competitive fire, fighting off challenges from Subway, Wendy's, Burger King and Yum! Brands.
Yum! operates Kentucky Fried Chicken, Taco Bell and Pizza Hut, among others.
"A huge number of Subways have appeared in Moscow in recent years," said Dmitry Mikhailov, a 30-year-old consultant who lives in Russia, in a Bloomberg report. "I pass about five of them on my way home."
McDonald's, which opened the doors to American fast-food markets in Russia 20 years ago, is now looking at franchising as a way of fending off its competition. That would be a first for McDonald's in Russia — but it could prove the saving business decision. Russia accounts for two-fifths of McDonald's revenues around the world, Bloomberg reports.
"Russia is a priority market for McDonald's," said Khamzat Khasbulatov, who heads the company's operations in the country, Bloomberg reports. "And franchisees will play a significant role in our success."
McDonald's saw its revenues fall significantly in Russia is 2012, Bloomberg reports. At the same time, Subway opened 432 shops in the country in the past three years, Burger King opened 86 since 2010, and Yum! has brought 186 KFC restaurants to the country — in just the past year.
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