McDonald's expands in Peru

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LIMA -- McDonald's opened its seventh store in Lima, the Peruvian capital, July 25, with predictions of sustained growth in the coming years.

Jose Hernandez, general manager of Operaciones Arcos Dorados (Gold Arches Operations), McDonald's representative in Peru, said the company planned to open another 30 outlets in Lima in the next five years and will expand into the provinces in 1999, specially Arequipa in the south and Trujillo in the north.

"We are growing in a planned manner so that everyone will benefit," Mr. Hernandez said. He said sales were up 12% in the first six months of this year and the company expects earnings for 1998 to be around $6 million, 150% more than in 1997. Each new venue costs between $700,000 and $1 million to open.

Mr. Hernandez said there are about 60 fast-food options operating in Lima today, which is well below the saturation level.

Copyright July 1998, Crain Communications Inc.

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