Russia’s answer to McDonald’s: ‘We’ve gone back to the same old’

Packaging without logos and a very sparse menu where the Big Mac has been replaced, for the moment, by a burger as tasteless as it is generic, the Grand. This is how the first restaurant of McDonald’s spiritual successor in Russia has reopened. The chain has been renamed Vkusno & tochka (which can be translated as “Tasty, period”) by its new owner, Alexander Govor. The businessman, who made his fortune from mining, represents a new phase of Russian capitalism: from the oligarchy formed by post-Soviet privatizations to those who are taking over the business left behind by Western companies after their hasty flight from a country isolated by its offensive on Ukraine.

Góvor, a former partner of the U.S. multinational with several franchises in Siberia, told the Russian agency Ria Novosti this Sunday, the day of its grand opening, that he bought the McDonald’s network “for a symbolic price” and does not plan to invest in its expansion. According to his calculations, the bet will be profitable in less than two years.

“It’s an impressive day for which we have been preparing for three weeks. We were expecting a huge number of visitors and wanted all our quality standards to be up to par,” says Ruzanna Sarkisiyan, the manager of another former Moscow McDonald’s, who lent a hand in the opening of the new establishment. According to her estimates, nearly 2,000 customers thronged the outlet near Púshkinskaya Square, a symbolic establishment because it was the first to open in the death throes of the Soviet Union. “We anticipate that about 20,000 people will stop by [this Sunday]. We have approximately 400 employees here,” Sarkisiyan adds.

The logistics have been more than fulfilled. Outside the restaurant, a line several dozen meters long is moving at full speed. Within five minutes the doors of the establishment are crossed, and once inside the numerous cash registers take less than 10 minutes to deliver the menu. “The name changes, but the love remains,” reads a huge sign outside the establishment. However, this reopening does not bring the same joy as the chronicles of 1990.

“I was at the opening of the first McDonald’s 30 years ago,” says Mikhail Gazmanov, who has come with his grandson. “The line was gigantic; it went around the block three times. At that time, we were unfamiliar with the food, taste and style; it was something interesting and thrilling. Now we have the same old again. The situation can’t get any worse. Before there was no distinction. We Russians were naïve. We thought that with the fall of communism, Europe would come in and we would maintain a friendly relationship, but the capitalist world has its rules and the Russians have understood that. Now their only hope is in themselves,” he adds gloomily.

Meanwhile, another customer whose name is Pavel says, “There is a huge difference between this and the first opening. Before, there was the glimpse of a different world; what we had up to now will never come back.” To which his wife, Olga, says, “What is to come will be better.” Both are only here to look around and confirm their suspicion that 30 years ago the opening was far more impressive, “a global milestone,” they say.

There is a general consensus among the clientele that the menu at Vkusno & tochka (which translates as Tasty, period) is short on variety. “It’s tasty, but it’s not like it used to be. Hopefully, there will be more choices, but right now it’s quite limited,” says Gazmanov. A young customer called Dmitry Shurmov, says, “It’s good. It’s the same, only with Russian products.”

The menu is very simple. There are only three hamburger options: a plain hamburger; a cheeseburger, and the Grand Deluxe hamburger, which is, in fact, quite tasteless and bland, like the fries. As for desserts, they are totally generic: caramel ice cream, strawberry ice cream and chocolate ice cream on the one hand; and slushies on the other. Addressing the lack of a logo, Sarkisiyan says, “It is true that the products are not branded, but the logo is still being decided and we are eager to present it to our customers.”

The prices, which increased in McDonald’s last year in Russia due to inflation, have remained the same. A Grand Deluxe accompanied by a Coke zero and small fries costs 343 rubles – the equivalent of about €5 at the official exchange rate.

Protest at the gates

The opening of the restaurant coincided with the celebration of Russia Day, the anniversary of the country’s independence from the Soviet Union. Since last year, dozens of police vans have been deployed in the square to prevent demonstrations – not, however, the kind staged by a group of Russians outside Vkusno & tochka who are taking issue with the continuation of Western culture in the country. “It has to be closed. It’s American food, we don’t need it. They should cook pelmeni and borscht!” shouts protestor Liubov Androonova, an elderly woman handing out National Liberation Movement leaflets. “We don’t want to be a colony,” she insists as her companion, a middle-aged man in military uniform, loudly urges a Chinese reporter to highlight the fact that Russians want nothing to do with the United States.

The agreement signed by Govor with McDonald’s includes a clause saying the new Russian chain will not use McDonald’s brands or menus and that it will preserve tens of thousands of jobs for at least two years. Meanwhile, McDonald’s has posted losses of $1.36 billion – about €1.3 billion – following its exit from the Russian market. Many other Western companies face increasing legal uncertainty in Russia. The Kremlin is currently developing a law that will allow for the nationalization of the assets of foreign companies that are applying pressure on the country by suspending economic activity.

During the inauguration of the new burger establishment, Carlos Santana’s Maria, Maria plays in the background. Its copyright belongs to Sony through the EMI-Blackwood label. In fact, the Japanese multinational together with Universal and Warner have closed their offices in Russia and some stores and restaurants have stopped playing their songs due to the difficulties posed by sanctions when it comes to paying for their use. In response, the Kremlin has pushed through another law that will legalize all types of venues, from cinemas to restaurants, to pay royalties in rubles via domestic banks, if they wish to do so. Whether multinationals will agree is another matter.

The evolution of the new fast-food chain could provide a good sociological study on the power of brands. In its last three months, McDonald’s only operated in train stations and airports. The opening of the Vkusno & tochka locations will be gradual. According to the new owner, the 850 or so restaurants should be up and running within two months.

Govor made his fortune with the 1990s privatization drive undertaken by Boris Yeltsin. At that time, he acquired a number of mines in his native region of Novokuznetsk. After an accident causing more than 100 deaths in 2007, he sold the business to oligarch Roman Abramovich and moved his money into oil. Later, in 2015, he took McDonald’s franchises into remote parts of Siberia. Now, many wealthy Russians could follow in his footsteps and move into sectors vacated by Western companies. In the last two weeks alone, firms such as Allianz, Marriott, Shell and Starbucks have announced their departure.