Is Restaurant Brands International on Track With Its Aggressive Expansion Plans?

Restaurant Brands International (NYSE: QSR), or RBI, has big plans for profitable expansion this decade. The parent company of Burger King, Tim Hortons, and Popeyes Louisiana Kitchen declared its intention, back in May 2019, to increase its restaurant empire from the current 26,000 to 40,000 locations worldwide during the 2020s. Such a bold expansion would almost certainly lift its share value to a much higher level, but some questions remain about its indebtedness and its ability to actually deliver on launching 1,000 or more franchises each year to stay on target.

As part of its drive to expand its global empire of burgers, fries, coffee, and crunchy chicken, RBI outlined its strategy in its 2019 Investor Day presentation. The company currently has slightly more than 26,300 franchises open worldwide. While market penetration is highest in North America and Europe, several thousand outlets operate in Central America, South America, and Asia.

RBI identifies plenty of "unit gap" on the map that's still ripe for filling in with new restaurant openings. The biggest potential growth area is Asia, with a "gap" of approximately 27,000 restaurants. The gap measures the difference between RBI franchises and the largest competing chain. In the Asian market alone, RBI notes that the gap is 7,139 restaurants focused on burgers, 8,764 focused on coffee, and 11,472 serving chicken. The company identifies a 22,000-unit gap in North America, plus smaller totals still running into the thousands elsewhere.

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Source Fool.com