Yum! Brands aims to be the best restaurant brand in the world and feed the global population. Its growth strategies are to build leading brands in China across all categories, aggressively expand internationally, improve US brand positions and returns, and drive long-term shareholder and franchise value. The first strategy focuses on expanding in China as its middle class grows. The second focuses on international growth through new divisions. The third aims to turnaround US brands through innovation and relations. The fourth centers on optimizing ownership and maintaining social responsibility to boost long-term value.

2. Objective
 Be the best in the world at building great restaurant
brands.
 Defining a global company that feeds the world.
 How  Differentiation

3. Growth Strategies
• Build leading brands in China in Every Significant category.
• Drive aggressive, international expansion and build strong brands
everywhere.
• Dramatically improve US brand positions, consistencies and
returns.
• Drive industry leading, long term shareholder and franchise value.

4. First Strategy
“Build leading brands in China in every significant
category.”
 Main goal is to expand and grow regardless of all weaknesses and threats.
 The strategy will accomplish the expectation because it is specific to
China. Since, it is transitioning to a consumer based economy thus giving
rise to the middle class segment which is the company’s main customer
base.
 How?
by opening more branches in China.

5. Second Strategy
“Drive aggressive, international expansion and build strong
brands everywhere.”
 4 divisions: YRI (Yum Restaurants International), China Division, US
Division, India Division.
 To establish a strong brand recognition along with even more branches.
 Implementation:
India: Treated as a separate division due to expected future forecasts of
India being the largest consumer market in 2030.
Russia: Bought Rostik’s business (Russia’s leading chicken chain)
Africa: First-mover advantage.

6. Third Strategy
“Dramatically improve US brand positions, consistencies and
returns.”
Reversed negative same-store sales of KFC by investing in
product innovation and Improving franchise relations.
Implementation:
Expand Taco Bell branches from 5,000 to 8,000 units and
Pizza Hut from 6,000 to 8,000 units.

7. Fourth Strategy
“Drive industry leading, long term shareholder and
franchise value.”
High Cash from operations
High return
Consistent dividend yield
Implementation:
Reducing ownership in highly penetrated markets (UK & US)
and increasing their ownership in international markets.
Maintain strong social responsibility.

8. Management Key
Assumptions
India will be the highest consumption country in the
world by 2030
Applying the same strategy followed for the past 10
years will increase sales
More branches means more profit
Getting back on their feet under any external threats
such as disease from poultry.

9. Policy Alternative
 Fast Grow:
Aggressive growth strategy, pursue larger market
share or a stronger position in untapped markets

10. SWOT Analysis

11. Strengths
 Management
 Adapted favorable cost structure
 Efficient same-store sales.
 Geographic diversification
 Quick responds to shifts in demand
 Strong brand recognition

12.  Pending litigation, lawsuits
 Underperformance and slowing of U.S. sales specifically with KFC
and Pizza Hut brands
 Suffer a setback in China following an investigation into KFC
China’s poultry supply which resulted in a sharp decline in sales.
 Relatively small market share in oversaturated U.S. fast food
industry
 Older U.S. restaurant units losing sales annually
Weaknesses

13.  Increase and maintain growth in rapidly expanding China market
 Invest in India market
 food options coinciding with religious beliefs
 Penetrate other new growth markets before competitors
 Target international youth consumer to build up brand awareness
 Increase number of health conscious menu options
Opportunities

14.  Food safety- animal diseases arising
 Nutritional value concerns
 High reliance on China allows the company to be subject to any
relevant changes in the Chinese market
 Changes in foreign currency exchange rates affect sales and
profit
 Modifications in foreign government regulation
 Farmers raising prices
Threats

15. Abell Model
How? (Approaches):
•Quick service restaurant
•Menu customized to
countries
Who?(Customers):
Non-health conscious
Middle-class segment
What?(Needs):
•Hunger
•Open appetite
•Quick food

16. Porter Model
Rivalry among
competitors
• Large number of
competitors
• Industry growth rate
• Product differentiation
• Prices
Buyers
• Cleanliness
• Speed of
delivery
• Hospitality
• Customizati
on
• Price
sensitivity
Suppliers
• Raw
material
• Labor
• Delivery
cars
• Gas
• Equipment
Barriers to Entry:
Government regulations to
control health standards
Initial capital requirements
Threat of Substitutes:
• Healthier alternative
• Ready made food
• Street booths

17. Strategic Position
Emerging Growth Mature Aging
Dominant
Strong
Favorable
Tenable
Weak

18. Basis of Competition
McDonald’s Burger
King
Papa Johns
Price 0 0 +
Cleanliness - - -
Location 0 + +
Depth of Line 0 + +
Speed - 0 +
Delivery - 0 0

19. Industry Maturity
Emerging Growth Mature Aging
Growth rate *
Industry
Potential
*
Product line *
Number of
competitors
*
Market share
stability
*
Purchasing
patterns
*
Ease of entry *
Technology *
Overall ***

20. Risk Assessment of
Strategy
Low Medium High
Industry *
Maturity *
Competitive
position
*
Strategy *
Assumptions *
Past Performance
-of unit
-of management
*
*
Level of future
performance
*

21. Conclusion
Looking forward, Yum! Brands is in a strong position to
maintain foreign expansion and capture a large share of
the international market. Despite certain challenges it
faces in the domestic market, the company is financially
healthy and should be able to sustain a
stable position within the global fast
food industry.