Kfc in beijing

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Globalized Childhood? Kentucky Fried Chicken in Beijing

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KENTUCKY FRIED CHICKEN CASE STUDY OF KFC

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KENTUCKY FRIED CHICKEN CASE STUDY OF KFC: ESTABLISHMENT OF A SUCCESSFUL GLOBAL BUSINESS MODEL By the mid 1950s, fast food franchising was still in its infancy when Harland Sanders began his cross-country travels to market “Colonel Sanders’ Recipe Kentucky Fried Chicken.” He had developed a secret chicken recipe with eleven herbs and spices. By 1963, the number of KFC franchises has crossed 300. Colonel Sanders, at 74 years of age, was tired of running the daily operations and sold the business in 1964 to two Louisville businessmen—Jack Massey and John Young Brown, Jr.—for $2 million. Brown, who later became the governor of Kentucky, was named president, and Massey was named chairman. Colonel Sanders stayed in a public relations capacity. In 1966, Massey and Brown made KFC public, and the company was enlisted on the New York Stock Exchange. During the late 1960s, Massey and Brown turned their attention to international markets and signed a joint venture with Mitsuoishi Shoji Kaisha Ltd. In Japan. Subsidiaries were also established in Great Britain, Hong Kong, South Africa, Australia, New Zealand, and Mexico in the late 1970s. Brown’s desire to seek a political career led him to seek a buyer for KFC. Soon after, KFC merged with Heublein, Inc., a producer of alcoholic beverages with little restaurant experience and conflicts quickly arose between the Heublein management and Colonel Sanders, who was quite concerned about the quality control issues in restaurant cleanliness. In 1977, Heublein sent in a new management team to redirect KFC’s strategy. New unit construction was discontinued until existing restaurants could be upgraded and operating problems eliminated. The overhaul emphasized cleanliness, service, profitability, and product consistency. By 1982, KFC was again aggressively building new restaurant units. In October 1986, KFC was sold to PepsiCo. PepsiCo had acquired Frito-Lay in 1965, Pizza Hut in 1977 with its 300 units, and Taco Bell in 1978. PepsiCo created one of the largest consumer companies in the United States. Marketing fast food complemented PepsiCo’s consumer product orientation and followed much the same pattern as marketing soft drinks and snack foods. Pepsi soft drinks and fast food products could be marketed together in the same restaurants and through coordinated national advertising. The Kentucky Fried Chicken acquisition gave PepsiCo the leading market share in three of the four largest and fastest growing segments in the U.S., quick-service industry. By the end of 1995, Pizza Hut held 28% of the $18.5 billion, U.S. pizza segment. Taco Bell held 75% of &5.7 billion Mexican food segment, and KFC held 49% of the $7.7 billion U.S. chicken fast food segment. Japan, Australia, and the United Kingdom accounted for the greatest share of the KFC’s international expansion during the 1970s and 1980s. During the 1990s, ot ...

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Ethnic Food of Cross-Culture Adaptation What role does food play in society? Haiming Liu and Lianlian Lin point out the role in the Journal of Asian American Studies, “Food is an expression of ethnic resilience” (150). With regard to food, it means ethnic food in other countries tries to balance between adaptations and authenticity. Chinese food in America and KFC in overseas countries are controversial due to authenticity. Chinese food in America is not as pure as in China, the changing of ingredients and structure of meals which can interpreted as Americanization. Also, KFC branches in oversea countries offer different food to meet the local people’s taste. Some argue that the adaptation of ethnic food harms authenticity, even the ethnic food would totally mix with other culture’s food. However, ethnic food does not lose its authenticity, but adapts to local cultures. Chinese food does change a lot to cater the local people’s taste. After a Qing government official, Li Hongzhang, visited the U.S.A in late 1800s, he changed the popularity of Chinese food by bringing his favorite food called “chopsuey”. Rapidly, chopsuey houses attracted many New Yorkers and out-of-town guests. Post-1965 Chinese immigrants become more diverse than the old generation. New immigrants brought the new taste such as Hunan, Mandarin, and Szechwan variations of Chinese cuisines to serve Chinese clients in Chinatown. For the American people, eating Chinese food is not only the exotic experience, they treat it as a weekly routine and a Christmas tradition. Chinese food in America is so popular because it meets Americans’ taste, but that does not mean Chinese food has lost its authenticity. Even though American people appreciate Chinese food, what they are eating is the Americanized Chinese food. According to Lu and Fine’s article “The Presentation of Ethnic Authenticity”, the traditional Chinese food “is prevented by social, cultural, and economic constraints of the market” (540). Because of these constraints, Chinese food had to change the ingredients, cooking process and structure of meals. To meet American tastes, many restaurants change the ingredients of the cuisine. For example, the authentic Chinese food uses wax gourd and fresh bamboo roots instead of broccoli and green peppers which largely used in America. Although some vegetables are available in America, the cost is higher than American vegetables. The structure of meals is also altered. According to Liu and Lin’s investigation, they point out a totally different meal format from the food in China, “Tea was offered as a free soft drink, soup was served at the beginning rather than the end of the meal and the fortune cookie was invented as a free dessert delivered with the bill” (150). In facts, in China, soup is served at the end of the meal and tea is not often seen in restaurants. From the American people’s point of view, the most representational of Chinese food, fortune cookies are an American ...

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Business Strategy Group B Case Study- KFC Business Analysis Abstract Introduced in 1952 by Colonel Sanders Second largest restaurant chain today in terms of popularity Annual revenue of $23 billion Diversified its menu to suit cultural needs of people across different countries Hindering factors in KFC’s growth are growing consumer health consciousness, animal welfare criticism, environmental criticism Introduction KFC was born in 1952 and its founder was Colonel Sanders First franchise to grow globally over international market By the 1960s – 1980s the market was booming in countries like England, Mexico, China Management and ownership transferred over the years to Heublin, Yum Brands and PepsiCo. Annual revenue of $23 billion in 2013 KFC had expanded its menu to suit cultural needs of people across different countries Hindering factors in KFC’s growth are growing consumer health consciousness, animal welfare criticism, environmental criticism, logistic management issue in UK, cultural differences in Asian countries towards accepting the fried chicken menu. Factors contributing to KFC’s global success The core reason for KFCs success is it’s mandate to follow strict franchise protocols that have continuously satisfied customers demands: The quality of the chicken cooked in KFC has certain specific guidelines The size of the restaurant should be 24x60 feet. The restaurant washrooms and ktichen has certain cleanliness standards Food that is not sold off needs to be trashed The workers need to have a specific clothing and uniform. A certain % of the gross earnings should be used for advertisement and R&D Air conditioning is mandatory in the outlets Global number of KFC restaurants in the past decade Importance of cultural factors to KFC’s sales success in India and China Culture is the collective programming of the human mind that distinguishes the members of one human group from those of another. Culture in this sense is a system of collectively held values “Culture is everything that people have, think, and do as members of their society”, which demonstrating that culture is made up of (1) material objects; (2) ideas, values, attitudes and beliefs; and (3) specified, or expected behavior. Many scholars have theorized and studied the notion of cross-cultural adaptation, which tends to move from one culture to another one, by learning the elements such as rules, norms, customs, and language of the new culture (Oberg 1960, Keefe and Padilla 1987, Kealey 1989). According to Ady (1995), “Cultural adaptation is the evolutionary process by which an individual modifies his personal habits and customs to fit into a particular culture. It can also refer to gradual changes within a culture or society that occur as people from different backgrounds participating in the culture and sharing their perspectives and practices.” Cultural factors in India that go against KFC’s original recipe. .

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22144192_080550.doc Adell Williams 4244 Peters Road Plantation Drive FL, 33317 [email protected] 22144192 080550 1 |Page PROJECT RETURNED UNGRADED Your project is being returned ungraded because you did not appropriately complete the assignment. The assignment was to first examine and evaluate the strategies used by KFC and McDonald’s when expanding into China. You were then to pick the strategy you would use to expand into India and justify your reasons for picking it. For example, one company tailored their experience to the culture of the country they were expanding to while another used its same business model to expand into a new country. This is a “case study”. Provide in-depth thought and analysis to the questions being asked. Please rework and resubmit the paper for grading. Also, be sure to provide proper citation and references. Thank you, Penn Foster Instructor Kentucky Fried Chicken and McDonald’s are the two main fast food global companies in the world. These two companies have used various marketing approaches to expand into China and other parts of the world. These strategies have led to the growth of both companies. McDonald’s was founded in the year 1995 in the United States, when it served its customers with French fries and hamburgers. KFC was founded in the year 1952 in the United States (which is one brand of Yum). It serves its customers with chicken that has a unique taste. McDonald’s made more sales than KFC at first. Later, both KFC and McDonald’s expanded to China, and the sales made by these two companies have been reversed. KFC has progressed more efficiently in China than McDonald’s. The difference that came in between these two companies was their marketing approaches in China. The differentiation and similarity between McDonald’s and KFC in China commenced a long time ago. KFC established its first branch in China in the year 1987. At that time, it was the only western fast food provider in the country (Hendrikse 78). Currently, it has four thousand five hundred and sixty-three branches hence considered the biggest food outlet in the country. The first McDonald’s branch in the country was opened in the year 1990, and it has two thousand and three branches in the country. KFC expanded to China earlier than McDonald’s and that was its first strategy. The second difference in the strategies of the two companies was their products. KFC strategized in offering chicken products to its customers. Standard production levels were used by KFC and they sold cheap western products which favored the local people. Their menu changed every now and then to meet the customer's needs (Kurtz, David and Louis 209). Some foods were offered permanently while others were temporary on the menu. KFC also had a secret recipe that it used to prepare its dishes. McDonald’s sells mainly beef and hamburgers. People of China prefer chicken over beef. Culturally, Chinese keep more chicken as compared to the number of cattle. This i.

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Kfc in beijing

1. Globalized Childhood? Kentucky Fried Chicken in Beijing

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