Premier Capital

A fresh face

A major refurbishment programme and plans for continued expansion, mean Premier Capital looks set to take a bigger bite out of the market

With its instantly recognisable golden arches logo, McDonald’s is one of the world’s leading fast-food restaurant chains. Part of this iconic brand, Premier Capital was established in 2005 to acquire the development license for McDonald’s in Malta, where the chain has been present since 1995. In 2007 Premier Capital also acquired the license for the markets of Latvia, Lithuania and Estonia. Melo Hill, managing director of Premier Capital, elaborates on the company’s history: “When we took over, Malta had eight restaurants, the same number as today. In the Baltics there were 19 restaurants when we acquired the licenses of the three countries.”

Since then Premier Capital has expanded with six more restaurants across the Baltics and plans to have a total of 35 restaurants by 2013. Currently Premier Capital is in the midst of a refurbishment and remodelling programme to update its restaurants across its portfolio. Melo describes the state of the programme: “In Malta the programme is pretty much complete – the last restaurant should be finished in the next couple of months. Out of the 19 restaurants we acquired in the Baltics, 18 required modernising and refurbishment. We’ve been working on three or four a year and by 2012 they should all be complete.”

This modernisation involves giving the restaurants a new look designed to attract customers and incorporates the newest designs from within the McDonald’s brand. It also includes the modernisation of kitchens and other facilities. Melo expands on the refurbishment details: “It’s a mixture of décor, new IT systems and facilities such as cashless purchasing, Wi-Fi in the restaurants and different types of seating.” He continues with the cost of the programme: “In the Baltics alone the whole programme will cost about ten million euros spent between 2008 and Premier Capital Issue 3 2010 b2012.”

The refurbishment is part of Premier Capital’s strategy to keep its restaurants up to date and the new facilities such as Wi-Fi incorporate developments in technology and consumer demand. Melo explains: “We are continuously trying to improve customers experience as much as possible. This is our philosophy at McDonald’s – we believe that whatever we do and whatever money we spend should benefit the customer.”

Customers aren’t the only point of focus for Premier Capital, it is also very aware of its social and environmental responsibilities. Melo highlights how Premier Capital is helping to improve local communities: “In 2007, we set up the Ronald McDonald Charity Foundation in Latvia. The primary focus of the charity was to fund a medical care mobile, which would go around assisting the local community. Despite challenges along the way, the care mobile was successfully launched in Riga this year and will shortly be operating around the country. We also actively work with other charities across the other three markets and hold annual raising funds.”

Premier Capital fully embraces the challenges of environmental responsibility, using a variety of methods to reduce the impact of its business upon the environment. “We recycle all the old oils from our kitchens which are used to make bio-diesels. Within our restaurants most of the packaging is now made from recycled materials which is much better than the past,” says Melo.

He continues with Premier Capital’s commitment to investing in more energy efficient equipment: “We work to make sure any new equipment that is brought, replaced or refurbished is much more energy efficient than what we had previously. Although it sometimes costs more than other equipment, we prefer to use it because it reduces environmental impact and there is an element of cost reduction through such methods.”

Market conditions have been challenging over the last couple of years, with the Baltic states, and much of Europe, struggling with the economic downturn. Despite this Premier Capital is positive about the recovery and growth of the market. Melo focuses on how Premier Capital continued to expand during the crisis: “Although 39there was a downturn in business over the last quarter of 2009 and early 2010, we are seeing good signs of recovery. Throughout the recession we continued to open stores as we firmly believe in being prepared so that when the market recovers we are ready with bigger, better and more stores.”

Premier Capital has plans to expand over the next few years to reach its target of 35 stores by 2013. “We are really looking to grow the business through building ‘drive thru’ restaurants and consolidating our position in the cities whilst growing our business nationally b y opening stores in smaller cities within the four countries,” adds Melo. There are also plans to continue to develop and update the range of food products that are available across the restaurants. Melo concludes: “Our menu has various tiers including our core products, saver menu and premium products. We have begun, and will continue, to introduce more premium range products and more promotional offers. We are also looking at new desserts and premium milkshakes, and have recently launched a new wrap product. Essentially we are working to continuously introduce new and enticing products to our menus.”