McDonald's has been in the headlines quite a lot this year, but the news that they're closing 20 percent of their stores in India is probably one headline they'd rather stay out of.
According to a new report, the United States-founded conglomerate has been having trouble in India due to issues with its business partner there, Connaught Plaza Restaurants, or CPRL.
CPRL claims that one of their most important food suppliers, Radhakrishna Foodland, has not been holding up its end of the deal, failing to provide supplies in a timely manner and sometimes not all.
“Almost all the outlets in east India have been shut because of the move by (the) logistics partner. Others (in north India) are also under pressure due to a supply crunch,” CPRL’s managing director, Vikram Bakshi, told reporters.
Bakshi claims Radhakrishna Foodland, “allegedly in collusion with McDonald’s Corporation and their wholly-owned subsidiary McDonald’s India Pvt Ltd…has decided to hold back stock paid for approximately Rs10 crore by us.”
However, the plot continues to thicken as Radhakrishna Foodland defends themselves by accusing CPRL of not paying them the money they are owed for the supplies ands services they provide, as reported by Quartz.
A spokesperson for McDonald's commented on the situation and brushed off claims that they were involved in the squabble between CPRL and Radhakrishna Foodland.
“This is between CPRL and their vendors, not MIPL. The allegation of us being involved in the decision comes from someone with whom we have had ongoing legal disputes. MIPL did not instruct any of CPRL’s vendors to stop delivery to CPRL. We were only informed of their decisions afterwards,” the company stated.
Per reports, McDonald's is searching for a new business partner in the area to help run its northern and eastern India chains.