Incorporated: 1971
NAIC: 722110 Full-Service Restaurants
SIC: 5812 Eating Places
Quick Restaurants S.A. is a French-owned, Belgium-based operator of fast-food restaurants. The company, which features a hamburger based on McDonald's, is the sole European-owned fast-food format that has successfully resisted the arrival of the major U.S. chains. Quick has long claimed the leading position in the hamburger segment in Belgium, and holds a strong second place in France. Quick operates more than 410 restaurants, including more than 80 in Belgium and Luxembourg, and 320 in France. In 2007, the company, which operates five restaurants in the French-controlled island of Réunion, launched an effort to build a wider geographic presence. The company targeted Spain, Morocco, Algeria, and Russia for the initial phase of this effort, and has opened sites in Andorra and Algiers, and two restaurants in Morocco. The company has also announced plans for further restaurant openings in its core French and Belgian territories.
Approximately three-quarters of the company's restaurants are operated through its franchise network. Founded in 1971 as part of the Belgian GIB supermarket group, Quick went public in 1993. In 2007 France's Caisse des Dépôts et Consignations Capital Investissement (CDC CI), through its Financière Gallop holding, took full control of the company, which was subsequently delisted. Quick is led by Chairman and CEO Jean-Paul Brayer.
Emulating the United States in 1971
Quick's ability to survive and even prosper in the highly competitive European fast-food market stemmed from its early entrance into what was at the time an untouched market. The fast-food restaurant concept had been introduced in the United States in the 1950s, but the format had not reached the continent. While pioneer McDonald's and others focused on building up their networks in the United States, the restaurant sector in Europe remained dominated by traditional restaurants and eating habits through the late 1960s and into the early 1970s.
In Belgium, however, one of the continent's first fast-food chains had begun to transform the country's restaurant sector. In 1968, Baron Vaxelaire, founder and leader of Belgian supermarket group GB Entreprises, had discovered the fast-food concept while on a trip to the United States to gather new retailing ideas. GB set up a new subsidiary, called Quick Restaurants, and began adapting the American hamburger-based menu to the Belgian palate. GB opened its first two Quick restaurants in 1971, in Schoten and Waterloo.
GB's supermarket network provided the framework for Quick's expansion, and the company's restaurants were typically located next to or near the group's supermarkets and hypermarkets. This network was further expanded in 1974, when GB Entreprises merged with rival Inno-BM, operator of the Innovation, Grand Bazar, and Bon Marché retail chains. The new company, called GB-Inno-BM, and later GIB, emerged as a leader in Belgium's retail sector, providing the backing for Quick's own growth.
In its early years, new Quick restaurants were wholly owned by the company. In the second half of the decade, however, Quick again looked to its U.S. models for inspiration, and began developing its own franchise network to stimulate expansion. The first Quick franchise opened in Brussels in 1978. Franchising proved a cost-efficient method for rapidly building the company's network of restaurants, which typically required two to three years to achieve profitability. By focusing much of its expansion through the franchise channel, the company was able to avoid taking on too much debt.
French Expansion Beginning in 1979
Quick's early entry into the Belgian market enabled it to gain and keep the leading position in that country. This remained true despite the entry of McDonald's Corporation, then in the midst of its European conquest, into Belgium. Success in the small Belgian market had its limits in the long term, however. In order to secure a larger base of operations for the future, the company targeted expansion beyond Belgium for its second decade in business.
Quick's interest naturally turned to Belgium's southern neighbor, France. The company opened its first Quick restaurant in France in Aix-en-Provence in 1978. The larger scale of the French market, however, led the company to seek a local partner for the expansion of the format there. In 1979, the company entered into a joint venture with supermarket group Casino in order to launch a full-fledged chain of Quick restaurants in France. As part of that agreement, Casino acquired a 21.5 percent stake in Quick from GIB. The first Quick restaurant under the joint venture opened in 1980.
With the backing of two powerful supermarket groups, Quick prepared its next phase of expansion. The company realized the necessity of gaining scale quickly in France, in order to generate profitability, but also in order to claim the country's prime locations. With McDonald's growing strongly, and with the arrival of Burger King in France, Quick turned to acquisition to provide its own French network with a jumpstart. In 1986, the company acquired the O'Kitch chain of 20 restaurants. This was soon followed by the purchase of the Freetime chain, adding another 45 units to its French portfolio. Most of these restaurants were then remodeled into the Quick format, a process largely completed by the beginning of the next decade.
Going Public in 1993
Quick had also launched an aggressive expansion drive, doubling the number of restaurants in France over the course of five years. The expansion allowed the company to build its French network to 145 stores by 1993, as compared to 62 stores in Belgium. By then, the company had also opened three stores in Luxembourg.
Throughout this period, Quick continued to adapt its restaurant format and menu, in part in response to its competitors' operations. Starting in 1983, the company added takeaway service and then introduced drive-up windows to most of its restaurants. The company also adapted McDonald's Happy Meal concept for its own restaurants, while adopting the U.S. giant's strategy of marketing to children.
Casino sought an exit from its shareholding, and in 1993 Quick placed the French supermarket group's shares on the Belgium Stock Exchange. GIB remained the group's majority shareholder, with more than 57.5 percent. The initial public offering (IPO) enabled the company to restructure its capital, reducing its debt and achieving a more stable financial footing.
The IPO also enabled Quick to launch a new and more aggressive phase of its expansion. The company's franchise operations formed the heart of its new growth strategy as it sought to increase the balance of franchises to company-owned restaurants from just 20 percent at the start of the 1990s to a target of 75 percent by the end of the decade. Quick stepped up the pace of new restaurant openings into the middle of the decade, and by 1996 had increased the number of Quick restaurants in operation to nearly 315. In this way, Quick not only maintained its leader status in Belgium, but also assured itself of the number two position in France as well.
Reeling from the BSE Crisis
The second half of the 1990s proved difficult for the company. The recession that lingered throughout much of Europe resulted in record numbers of unemployed and underemployed youth--precisely Quick's primary consumer segment. The reduced spending of its core customers slowed the company's revenue growth.
At the same time, Quick was feeling the effects of its ambitious expansion strategy as a number of its new restaurants had begun to cannibalize sales at existing outlets. This in turn caused resentment among the company's franchisees, who were already hard-pressed by the aggressive expansion of competing fast-food groups. McDonald's had launched an effort to gain the top sales position in Belgium, aggressively opening new restaurants while cutting its prices. At the same time, the traditional restaurant sector was forced to fight back, and more and more restaurants began developing lower-priced menus, with many starting to feature hamburgers as well.
To these difficulties were added the difficulties of Quick's management to accommodate to its own rapid growth, and the company's costs began to spiral. The company's spending on restaurant refurbishment had slowed, with the result that restaurants in its network had increasingly begun to appear run-down and out of date. Quick finally began to address these issues in 1997, when it launched a cost-cutting initiative along with a revamped marketing drive, including refurbished store formats and new menus.
However, these efforts could do little to counter the first of a series of crises to strike the food sector beginning in the mid-1990s. The fast-food market was in particular hit by the BSE (bovine spongiform encephalopathy or "mad cow disease") crisis in 1996. An outbreak of BSE, the so-called mad cow disease, among British and then European cattle herds was at that time accompanied by the first deaths from Creutzfeldt-Jakob disease, the human form of BSE. The discovery that BSE was transmissible to humans, and the possibility of extremely long incubation periods, sparked a panic among consumers, who turned away from beef consumption in massive numbers through the end of the decade.
Quick attempted to meet consumer concerns by adapting its menu, including introducing other meat choices, such as chicken. However, the company's core business remained hamburgers, and as a result the group's sales stagnated while its store expansion slowed dramatically. Through the end of the decade, the company managed to open just 10 to 14 new stores per year.
New Owners and New Objectives
The effects of the BSE crisis subsided very slowly through the end of the decade. The company, by this time with more than 400 restaurants, saw its sales start to rise again, driven by its French restaurant operations, and by 1999 the company's revenues had topped EUR 655 million. Another bright spot for the company came when Burger King announced that it was retreating from the French fast-food sector; Quick then acquired five of that company's locations in 1997. In this way, Quick remained the sole viable challenger to McDonald's in the hamburger segment, claiming nearly one-third of the market in France.
Quick then sought further international expansion. The company targeted the Netherlands in the late 1990s, opening two pilot restaurants in that country in 1999. However, the company's entry into this neighboring market came far too late, and Quick was forced to retreat from the Netherlands by 2000. The company began seeking other horizons, targeting Eastern Europe. The first Quick restaurant opened in Slovenia in 1999, while the company began negotiating with a local partner to develop the chain in Hungary as well. In the end, these efforts too proved unsuccessful. Into the early 2000s, the only foreign expansion to succeed was the group's extension into the French West Indies, where it opened five franchised restaurants starting in 2001.
A new BSE scare rocked the company at the beginning of the new century as BSE outbreaks began to appear in France and Belgium. The increasingly weakened company became the subject of takeover rumors, as it issued profit warnings in 2000. Instead, the company launched a restructuring effort, closing down 35 of its unprofitable restaurants, as well as shutting down its operations in Hungary and Slovenia in 2001. The restructuring process continued with the appointment of Jean-Paul Brayer, former head of the Flo restaurant group in France, as group CEO. The company then announced plans to shut another 35 restaurants through 2003.
As investors grew impatient with the company's struggles to restore growth, Quick's future prospects as a publicly listed company were called into question. The company also faced mounting pressure targeting the poor nutritional value of the fast-food sector, and its strategy of marketing to children. In order to deflect these concerns, Quick instituted its Value and Nutrition communication program in 2004, while adapting its menu to include fresh fruits and other items. The company also worked at reducing the fat content in a number of sauces, and experimented with allowing consumers to salt their own french fries.
In the meantime, the company launched a new expansion program targeting the North African markets. The company opened its first restaurant in Morocco in 2004. In 2005, the company signed a major franchise agreement in Algeria, calling for the opening of 20 restaurants in that country. The first of these opened in Algiers in 2006. Another potential market for the company was Spain, where the group opened its first restaurant in Andorra that same year.
Quick found a new owner at the end of 2006, when France's CDC CI agreed to buy out GIB's holding in the company through subsidiary Financière Gallop. That company then launched a full-fledged takeover offer, boosting its position to 97.2 percent by the beginning of 2007. In February of that year, Gallop then launched a minority "squeeze out," taking 100 percent control of Quick. Freed from investor pressures, Quick began developing a new strategy, including plans to resume opening new restaurants at the pace of 20 to 25 new sites per year.
Principal Subsidiaries
Financière Quick SAS; France Quick SAS; Quick Restaurants SAS.
Principal Competitors
Casino Guichard-Perrachon S.A.; Groupe Auchan S.A.; Rallye S.A.; McDonald's Corporation; Sodexho Alliance S.A.; Buffalo Grill S.A.; Elior S.A.
Further Reading
"Algeria Industry: Quick Restaurants to Open Fast-Food Chain," Economist Intelligence Unit, September 30, 2005.
Braude, Jonathan, "Bidders Scramble for Quick," Daily Deal, August 4, 2004.
"European Quick Restaurant Tapping into Chinese Market," Alestron, July 11, 2003.
Newpoff, Laura, "Wendy's Rumored to Be Suitor for Belgian Fast-Food Chain," Business First-Columbus, July 7, 2000, p. 10.
"Quick Restaurants," Euroweek, November 3, 2006, p. 58.
"Quick Restaurants Eyeing Deal to Buy 5 Paris BKs," Nation's Restaurant News, November 10, 1997, p. 6.
— M. L. Cohen
