Business Irish

Friday 28 October 2016

We'll expand in Europe with or without our brand - Supermac's

The expansion of Pat McDonagh's fast-food chain has been stymied by McDonald's in Australia as well as in Europe, writes Sarah McCabe

Published 31/01/2016 | 02:30

Fast-food rival McDonald’s had challenged Supermac’s application, claiming that McDonagh’s brand infringed on their own.
Fast-food rival McDonald’s had challenged Supermac’s application, claiming that McDonagh’s brand infringed on their own.

Supermac's will expand into Europe, starting with London, even if it has to do so under a different brand.

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"If we can't use Supermac's and we have to use something else, we will still do it," founder and chief executive Pat McDonagh told the Sunday Independent in an interview after an EU body ruled against the use of the Supermac's brand in Europe.

Mr McDonagh is appealing the decision and said he is still confident the appeal will succeed.

"We see very good reason to appeal, plenty of room to appeal and we will definitely appeal.

"We are optimistic that this decision only represents half-time in the game. There is still everything to play for in the second half and the wind is on our backs."

Last Wednesday the EU's Office for Harmonisation in the Internal Market handed down a split decision on Supermac's EU-wide trademark application.

It permitted Supermac's to use its brand name and trading name in the EU - but forbid it for the purposes of running fast-food restaurants or selling meat, fish, poultry, chicken nuggets, chips, onion rings or hamburgers.

Fast-food rival McDonald's had challenged Supermac's application, claiming that McDonagh's brand infringed on their own.

In a 24-page ruling, the Office for Harmonisation in the Internal Market agreed with McDonald's that Supermac's brand would be probably cause confusion among the European public. Supermac's has four months to appeal the decision.

"What is the point of giving us a trademark that we can't use? There is no common sense to it," said Mr McDonagh.

"It's like giving a pub a licence but preventing it from selling beer".

The Galway native questioned McDonald's motivation in challenging his brand now.

"I am at a loss as to why they are objecting to it so vigorously. We have been competing with McDonald's for 35 years and nobody has ever said it confused them.

"The logos, colours, the food we serve, the design of our restaurants are all totally different.

"There is no reason why people would confuse one with the other.

He said McDonald's have bigger issues than Supermac's trademark, "from declining sales in some markets" to tax probes.

EU competition regulators are currently investigating McDonald's tax treatment in Luxembourg, which enabled the American chain to limit taxes on its European franchise royalties since 2009.

"They are faced with a lot of new customer competition and they are trying to protect [themselves]."

Supermac's first foreign outlet - with or without its current brand - will be in London rather than Sydney, Mr McDonagh, a former teacher, added.

Plans for the Sydney outlet were announced several months ago with a franchisee secured.

However, the expansion has been shelved for now pending the outcome of a similar trademark row with McDonald's in Australia. The franchisee is no longer involved.

"We will do London first and then Sydney," said Mr McDonagh, whose other businesses include Papa John's pizza chain, a US Irish pub chain, several hotels and motorway service stations.

"We won't expand rapidly, it will be one step at a time. Opening in a new market is no small challenge.

"We will learn from the UK where there is a big potential customer base of Irish people."

The company has received a wave of requests since the beginning of the recession to open in places to which Irish people have emigrated, he said, citing Toronto and Eastern Europe as well as the UK and Australia as examples.

"It's the same as Irish pubs or Tayto crisps. People who have emigrated are looking for a taste of Ireland."

Sunday Indo Business

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