Faced with soaring inflation, India's consumer giants are increasingly choosing to internalize high costs rather than pass them on to financially strapped consumers. This shows that the decline in household purchasing power has begun to squeeze the profit margins of businesses. Westlife Foodworld Ltd. is the operator of McDonald's fast food chain in western and southern India. The company's CEO Akshay Jatia said in an interview that in order to maintain store traffic, they are “quite conservative” about price increases that exceed regular annual increases. “We need to make sure we don't lift a stone over there and hit ourselves in the foot,” he said. Westlife is one of at least 15 consumer companies that are wary of increasing prices or maintaining their original prices. Companies including KFC and Pizza Hut operators Devyani International Ltd., Sapphire Foods India Ltd., leading paint manufacturer Asian Paints Ltd., and retailer V-Mart Retail Ltd., all cited uneven demand prospects as a reason for concern.

Faced with soaring inflation, India's consumer giants are increasingly choosing to internalize high costs rather than pass them on to financially strapped consumers. This shows that the decline in household purchasing power has begun to squeeze the profit margins of businesses. Westlife Foodworld Ltd. is the operator of McDonald's fast food chain in western and southern India. The company's CEO Akshay Jatia said in an interview that in order to maintain store traffic, they are “quite conservative” about price increases that exceed regular annual increases. “We need to make sure we don't lift a stone over there and hit ourselves in the foot,” he said. Westlife is one of at least 15 consumer companies that are wary of increasing prices or maintaining their original prices. Companies including KFC and Pizza Hut operators Devyani International Ltd., Sapphire Foods India Ltd., leading paint manufacturer Asian Paints Ltd., and retailer V-Mart Retail Ltd., all cited uneven demand prospects as a reason for concern.