Professional Documents
Culture Documents
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KFC & Global Fast Food Industry
Acknowledgement
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KFC & Global Fast Food Industry
TABLE OF CONTENTS
Title Page No
INTRODUCTION: ------------------------------------------------------------------------------------------- 1
RECOMMENDATIONS-----------------------------------------------------------------------------------43
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KFC & Global Fast Food Industry
Introduction:
Fast food (also known as Quick Service Restaurant or QSR within the
industry itself) is the term given to food that can be prepared and served very
quickly. While any meal with low preparation time can be considered to be fast
food, typically the term refers to food sold in a restaurant or store with preheated
or precooked ingredients, and served to the customer in a packaged form
for take-out/take-away. The fast food market is defined as the sale of food and
drinks for immediate consumption either on the premises or in designated eating
areas shared with other foodservice operators, or for consumption elsewhere.
The market is broken down in to four types of outlets: Quick Service Restaurants
(QSR), Takeaways, Mobile & Street Vendors and Leisure Locations. QSR's are
defined as: locations where the primary function is to provide full meals but
where table service is not offered. Takeaways are defined as: establishments
that provide freshly prepared food for immediate consumption and where
typically 80% or more of revenues come from consumers who take the food off
the premises to consume. Mobile & street vendors are defined as: Either
individual mobile stalls or vans that offer a limited range of freshly prepared food
as well as beverages. Leisure locations are defined as: locations serving food
and drinks for immediate consumption on premises within leisure outlets (such as
Cinemas, Theatres, Racecourses etc.) that the Leisure operator owns and
operates itself. With today's hectic lifestyles, time-saving products are
increasingly in demand. Perhaps one of the most obvious examples is fast food.
The rate of growth in consumer expenditures on fast food has led most other
segments of the food-away-from-home market for much of the last two decades.
Since 1982, the amount consumers spent at fast food outlets grew at an annual
rate of 6.8 percent (through 1997), compared with 4.7 percent growth in table
service restaurant expenditures. The proportion of away-from-home food
expenditures on fast food increased from 29.3 to 34.2 percent between 1982 and
1997, while the restaurant proportion decreased from 41 to 35.7 percent.
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Industry segments:
In fast food industry segments are grouped by menu format. Important
segments of fast food industry are:
Burger segment:
Burger segment made up the largest segment of fast food. Major
participants and their sales are given in the following table.
Fiscal year 2008 sales
1 1 McDonald's $30,025.00
3 5 Wendy's $8,013.40
4 10 Sonic $3,811.20
7 18 Hardee's $1,680.00
9 24 Whataburger $1,173.00
11 30 Checkers/Rally's $658.00
12 32 Culvers $643.50
14 47 Krystal $428.80
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Sandwiches segment:
Major participants of sandwiches segment and their sales are given
in the following table.
1 2 Subway $9,600.00
2 11 Arby's $3,371.80
Mexican segment:
Major participants of sandwiches segment and their sales are given in the
following table:
2 22 Chipotle $1,330.00
4 44 Qdoba $447.50
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Pizza/Pasta segment:
Pizza Hut leading the segment with sales of $5500.00MM. Major
participants of sandwiches segment and their sales are given in the following
table:
Fiscal year 2008 Sales
2 13 Domino's $3,054.60
7 40 Sbarro $500.00
Chicken segment:
KFC continued to dominate the chicken segment, with sales of
$5200.00MM in fiscal year 2008. Its nearest competitor Chick-fil-A, ran the
distant second, with sale of $2962.30MM. At 3rd position Popeyes with
$1593.00MM sales. Other major participants of chicken segment and their sales
are given in the following table:
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1 9 KFC $5,200.00
2 14 Chick-fil-A $2,962.30
3 20 Popeyes $1,593.00
5 29 Zaxby's $664.00
8 34 Bojangles' $607.90
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segment, delivery dominates, with firms like Dominos, Papa Johns, and many
independents focusing almost exclusively on delivery sales. Pizza Hut began
delivery service in 1986, and today 34 percent of the units are devoted
exclusively to delivery (offering no on-premise dining capacity).
Demographic trends:
In 1970, Americans spent about $6 billion on fast food; in 2000, they spent more
than $110 billion. Americans now spend more money on fast food than on higher
education, personal computers, computer software, or new cars. They spend
more on fast food than on movies, books, magazines, newspapers, videos, and
recorded music — combined. The extraordinary growth of the fast food industry
has been driven by fundamental changes in American society. Adjusted for
inflation, the hourly wage of the average U.S. worker peaked in 1973 and then
steadily declined for the next twenty-five years. During that period, women
entered the workforce in record numbers, often motivated less by a feminist
perspective than by a need to pay the bills. In 1975, about one-third of American
mothers with young children worked outside the home; today almost two-thirds of
such mothers are employed. The entry of so many women into the workforce has
greatly increased demand for the types of services that housewives traditionally
perform: cooking, cleaning, and child care. A generation ago, three-quarters of
the money used to buy food in the United States was spent to prepare meals at
home. Today about half of the money used to buy food is spent at restaurants,
mainly at fast food restaurants.
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most overseas outlets are owned by native franchisees to ensure that cultural,
ethnic, and community values are taken care of.
Additionally, multinational fast-food chains are not the only or even the primary
source of fast food in most cities of Pakistan. Many regional and local chains
have developed around the main cities of Pakistan (for example Khan Broast in
Karachi) to compete with international chains and provide menu items that
appeal to the unique regional tastes and habits at comparatively low costs. In
Pakistan, multinational chains are considerably more expensive; they usually are
frequented because they are considered chic and somewhat glamorous and
because they usually are much cleaner than local eateries. However much of the
middle-income segment (which forms a major chunk of fast-food goers) prefers
visiting local outlets that offer low cost fast food, hence more frequent visits.
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KFC At-A-Glance
9/9/1890
Harland Sanders is born just outside Henryville, Indiana.
1900-1924
Harland Sanders holds a variety of jobs including: farm hand, streetcar
conductor, and army private in Cuba, blacksmith's helper, railyard fireman,
insurance salesman, tire salesman and service station operator for Standard Oil.
1930
In the midst of the depression, Harland Sanders opens his first restaurant in the
small front room of a gas station in Corbin, Kentucky. Sanders serves as station
operator, chief cook and cashier and names the dining area "Sanders Court &
Café."
1936
Kentucky Governor Ruby Laffoon makes Harland Sanders an honorary Kentucky
Colonel in recognition of his contributions to the state's cuisine.
1937
The Sanders Court & Café adds a motel and expands the restaurant to 142
seats.
1939
The Sanders Court & Café is first listed in Duncan Hines' "Adventures in Good
Eating.” Fire destroys The Sanders Court & Café, but it is rebuilt and reopened.
The pressure cooker is introduced. Soon thereafter Colonel Sanders begins
using it to fry his chicken to give customers fresh chicken, faster.
1940
Birthdates of the Original Recipe
1949
Sanders marries Claudia Price.
1952
The Colonel begins actively franchising his chicken business by traveling from
town to town and cooking batches of chicken for restaurant owners and
employees. The Colonel awards Pete Harman of Salt Lake City with the first KFC
franchise. A handshake agreement stipulates a payment of a nickel to Sanders
for each chicken sold.
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1955
An interstate highway is built to bypass Corbin, Kentucky. Sanders sells the
service station on the same day that he receives his first social security check for
$105. After paying debts owed, he is virtually broke. He decides to go on the
road to sell his Secret Recipe to restaurants.
1957
Kentucky Fried Chicken first sold in buckets
1960
The Colonel's hard work on the road begins to pay off and there are 190 KFC
franchisees and 400 franchise units in the U.S. and
Canada.
1964
Kentucky Fried Chicken has more than 600 franchised outlets in the United
States, Canada and the first overseas outlet, in England. Sanders sell his interest
in the U.S. Company for $2 million to a group of investors headed by John Y.
Brown Jr., future governor of Kentucky. The Colonel remains a public spokesman
for the company.
1965
Colonel Sanders receives the Horatio Alger Award from the American Schools
and Colleges Association.
1966
The Kentucky Fried Chicken Corporation goes public.
1969
The Kentucky Fried Chicken Corporation is listed on the New York Stock
Exchange.
1971
More than 3,500 franchised and company-owned restaurants are in worldwide
operation when Heublein Inc. acquires KFC Corporation.
1976
An independent survey ranks the Colonel as the world's second most
recognizable celebrity.
1977
Colonel Sanders speaks before a U.S. Congressional Committee on Aging.
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1979
KFC cooks up 2.7 billion pieces of chicken. There are approximately 6,000 KFC
restaurants worldwide with sales of more than $2 billion.
12/16/1980
Colonel Harland Sanders, who came to symbolize quality in the food industry,
dies after being stricken with leukemia. Flags on all Kentucky state buildings fly
at half-staff for four days.
1982
Kentucky Fried Chicken becomes a subsidiary of R.J. Reynolds Industries, Inc.
(now RJR Nabisco, Inc.) when Heublein, Inc. is acquired by Reynolds.
1986
PepsiCo, Inc. acquires KFC from RJR Nabisco, Inc.
1997
PepsiCo, Inc. announces the spin-off of its quick service restaurants - KFC, Taco
Bell and Pizza Hut - into Tricon Global Restaurants, Inc.
2002
Tricon Global Restaurants, Inc., the world's largest restaurant company, changes
its corporate name to YUM! Brands, Inc. In addition to KFC, the company owns
A&W® All-American Food® Restaurants, Long John Silvers®, Pizza Hut® and
Taco Bell® restaurants.
2006
More than a billion of the Colonel's "finger lickin' good" chicken dinners are
served annually in more than 80 countries and territories around the world.
2007:
KFC goes Trans Fat Free.
2008:
June, Asset Optimization completed. Vision building: Per contract agreements,
franchisees given until June 1, 2008 to complete a facilities “renewal upgrade”
based on the Vision design and Gift Card program launched.
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Profit margins: The fast food industry's growth has been slowed by soaring food
and energy prices. The high prices of commodities, combined with the housing
slump and a weakening job market are taking a toll on restaurant spending in the
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U.S. (the world's largest fast food market, by far). The same food and energy
inflation that is corroding consumer spending is also taking a bite out of company
margins.
Standardized products: in fast food industry products are consider high
substitutes of each other. That results in low switching cost for the buyer to one
chain to another.
Product innovation: The companies in fast food industry tend to distinguish by
providing its customers with a unique fast food experience and offering value
menu items in their foods. With the introduction of new menus and product which
is designed to gain competitive advantage on its competitors, Continuous
innovation is important in order to maintain sustainable competitive advantage in
the industry.
% of working women and young population: The extraordinary growth of the
fast food industry has been driven by fundamental changes in society. . In 1975,
about one-third of American mothers with young children worked outside the
home; today almost two-thirds of such mothers are employed. The entry of so
many women into the workforce has greatly increased demand for the types of
services that housewives traditionally perform: cooking, cleaning, and child care.
Quick Stats on Women Workers of US, 2008:
¾ In 2008, Of the 121 million women age 16 years and over in the U.S., 72
million, or 59.5 percent, were labor force participants—working or looking
for work.
¾ Women comprised 46.5 percent of the total U.S. labor force and are
projected to account for 47 percent of the labor force in 2016.
¾ Women are projected to account for 49 percent of the increase in total
labor force growth between 2006 and 2016.
The growth rate in food consumption is also augmented by the rapid increase in
the employment rate for males / female population aging between 20 to 29 years
hence the greater income contribution to the overall income generated is
expected to be higher.
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Economies of Scale: Giants like McDonalds and KFC are able to achieve
economies of scale by high volume of production and many outlets but smaller
chains are unable to achieve it due to low volume production. Economies of
scale is a factor in fast food industry.
The Number of Buyers and Increase: New research from The Natural
Marketing Institute (NMI) released in 2008 reveals that consumers are
increasingly incorporating organic into their lifestyles. The research also showed
that the number of core users has increased from 16 percent in 2006 to 18
percent in 2007
Degree of Vertical Integration: Mixed: most major and largest companies are
integrated backward into raw material operations (farming) and also forward in
distribution of products through their outlets. Almost all companies are forwardly
integrated. As we know this industry is very quality and speed conscious so it is
very necessary to success.
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Most food chains began to expand their business into alternative distribution
channels in hospitals, airports, colleges, highways rest areas, gas stations,
shopping mall food courts, and large retail stores or by dual branding with other
fast-food concepts.
Localization of taste
Localization of taste means to provide food items in their menu according to local
taste and cultural. It is very critical success factor for global and international
players who operate more than one country. There are many countries which
have very unique food and taste such as china and India. For instance KFC
recognized this factor and provide the local along with global food items to their
customer and it is very successful in these countries.
Location
Location is very critical factor to take advantage over others in fast food industry.
A good location of the outlet in terms of area, population, roads and parking is
very important because this contributes to the convience of customer. Otherwise
a wrong location is just wastage of resources.
Environment
Inner environment of the fast food outlet is very matter. A good environment in
the terms of cleanness, coolness, contributes to the satisfaction of the customer.
Environment also includes the interaction between customer and outlet
employees. The behavior and attitude of the management plays very important
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Working Women
The increasing concept of working women is a major force which becomes the
cause of change in fast food industry and the nature of competition face by the
companies in fast food sector.
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Globalization
Where one or more globally franchise ambitious companies are pushing hard to
gain significant competitive position in many attractive markets by expanding
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prices. This is a growing opportunity for the industry because families nowadays
prefer eating out, rather than cooking at home.
Growing urban lifestyle: -
The growth is not limited to metro cities. Now it has also found it’s way into some
rural areas and some semi – urban cities. Fast food joints are not a thing of big
cities now. People in cities and towns are now having additional incomes in their
pockets. Eating out now is a normal thing for the homely people in the semi
urban areas.
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Conclusion
Growth Rate
In the market growth rate the expected food sales is predicted to increase by
$208 billion by 2020 with us already being at $800 billion by 2001.
RNCOS has recently released a new research report "US Fast Food Market
Outlook 2010" which says - despite the gloomy economic conditions, the US fast
food industry is witnessing robust growth. The overall fast food market is
expected to grow in coming years and will cross the US$ 170 Billion mark by
2010.
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Generation Y
How Often Do You Eat Fast Food?
Percent who say they eat at a meal from a fast food restaurant at least weekly
Notes: Question wording: About how often in an average week do you eat a meal from a fast food restaurant like
McDonald's or Burger King? (open end)
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SWOT Analysis
Strengths:
Strengths can be found internally in a company and can be used to the
company’s advantage. The strengths identified are as follows:
1. Brand Equity KFC.
# Brand Brand Value Brand Brand Brand Value
$M Contribution Momentum Change
1 McDonald’s 66,575 4 6 34%
2 SUBWAY 10,997 4 10 6%
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Weakness:
Weaknesses are also found internally like strengths. Weaknesses, however, can
limit a company’s potential. The weaknesses for KFC are identified as follows:
1. Relying on local franchisees.
That gains the following weaknesses.
• Franchising means less control over stores.
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Opportunities:
Opportunities represent external finding which can enhance a company’s
performance. Opportunities that KFC can take advantage of are as follows:
1. Growing nuclear families: -
Nowadays it is said to be the age of fast food. Parents and kids especially
prefer fast food due to it’s quick service and for it’s satisfying appetite at
affordable prices. This is a growing opportunity for the industry because
families nowadays prefer eating out, rather than cooking at home.
2. Growing urban lifestyle: -
The growth story of Pakistan is not limited to metro cities. Now it has also
found it’s way into some rural areas and some semi – urban cities. Fast
food joints are not a thing of big cities now. People in cities and towns are
now having additional incomes in their pockets. Eating out now, is a
normal thing for the homely people in the semi urban areas.
3. Opportunity against. Confused over “mad cow” and foot-and-mouth
disease?
Destruction of cattle, first to stop mad cow disease and then to stop foot-
and-mouth disease, dominated news stories from Great Britain for nearly
three years. The proximity of the diseases, both in place and time, has
caused a lot of confusion. So people hesitate to buy beef food due to fear
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4. "Dual branding" helps to appeal to the wider customer base and also
provide higher profit.
This strategy helps to "improve economies of scale within its restaurant
operations." For many companies that own more than one fast-food chain,
"dual branding" is an ideal way to expand quickly and increase profit. By
adding a brand to the existing fast-food store, the companies are able to
expand quickly and for less money. The companies are also capitalizing
on the increased customer base due to the increased menu offering.
Increased profit is another benefit of "dual branding." The companies are
enjoying higher profit due to the low cost in expanding and the reduced
advertising dollar spent by advertising the two chains together.
5. Australian Indian market opportunity.
Growths in international profits were highest in Australia, which is now
KFC’s largest international market has a big opportunity for KFC. A young
Canadian named Bob Lapointe started the fast food revolution in Australia
in 1968 when he opened the first KFC restaurant at Guildford in Sydney's
western suburbs. KFC now has more than 600 stores in Australia and
New Zealand, which are company owned or franchised. Indian GDP 1217
billion US$ with 7.20% growth population in 2010, 1171 million an
expected in 2050 is 1748 million expected. The countries have a big
opportunity to expand fast food net work. Also Indian not like beef as a
food.
6. New distribution channels offer a significant growth opportunity.
Especially in the last few years, consumers are demanding fast food in
non-traditional locations, such as shopping malls, universities, hospitals,
and other high-traffic areas. Consumers are demanding greater
convenience when purchasing. The locations listed above are some of the
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Threats:
Threats to a company are those business characteristics that endanger the
company’s position within its industry as well as jeopardize its profits. The threats
that KFC faced with include the following:
1. Supermarkets and new competitors.
KFC also have big threats due to his competitors. McDonald’s introduced
its McChicken sandwich in the US market in 1989. Jack in the Box has
introduced chicken and teriyaki with rice. Domino’s has introduced chicken
wings to its menu. Pizza Hut has tried marinated, rotisserie-cooked
chicken. McDonald's is going to take on KFC at their own game and the
head of Restaurant Brands replies to the war cry of MD of McDonald's
Mark Hawthorne:Chief operating officer Rod De Vries said sales had
increased 9 per cent in the past year - an outstanding result in a highly
competitive market.
2. KFC Fears Bird Flu Will Pluck Its Sales
The daily headlines about bird flu are sending a shockwave through the
fast food industry. KFC have survived in chicken that may face threat of
bird flu. Parent company Yum Brands told the trade publication it's bracing
for a 20 percent drop in sales if infected birds, wild or domestic, are found
in the U.S. The demand for chicken has already plunged as much as 40
percent in Europe and Asia in past few years.
3. Health Concerns: -
Due to the low quality ingredients used in the majority of local fast food
joints, the sanitation and the hygiene factors which are mostly not
maintained, have given cause to various medical and other health related
organizations and certain NGO’s who have taken it up to voice these
issues and bring it to the attention of the general public. Thus directing the
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attention of the public to change the tastes to foods that are more hygienic
and safe. Here canned foodstuffs stand to gain advantage.
4. Regulations, customs and Industry standards.
All food products imported into Pakistan must have a 'halal' certificate.
Items are restricted for religious reasons or to protect local industries. The
date of manufacture and expiry date stamped on each pack. Food
products must be free from haram (forbidden by Islamic law) animal
products, eg. pork. Meat products must have halal certification.
5. Saturation of the US market.
According to the National Restaurant Association (NRA), food-service
sales in 1995 will hit $289.7 billion for the U.S. restaurant industry. The
NRA estimates the sales in the fast-food segment of the food industry will
grow 7.2% to approximately $93 billion in the United States in 1995, up
from $87 million in 1994
6. Changing preferences of consumers.
During the 1980s, consumers began to demand healthier foods and KFC
was faced with a limited menu consisting mainly of fried foods. In order to
reduce KFC’s image as a fried chicken chain, it changed its logo from
Kentucky Fried Chicken to KFC in 1991. In 1992, KFC introduced Oriental
Wings, Popcorn Chicken, and Honey BBQ Chicken as alternatives to its
Original Recipe fried chicken. In 1993, KFC rolled out its Rotisserie
Chicken and began to promote its lunch and dinner buffet.
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MBA’S at PepsiCo who would love to take your position” (Mattson 63). This just
goes to show PepsiCo’s dedication to perfecting performance in the overall KFC
franchisees.
Over the past years, KFC’S stock has grown nationwide. KFC is extremely
popular in China and Japan. In fact, they are so well liked that during the
Christmas holiday, customers had to call in advance to order KFC. KFC has
gone thru several changes since their opening. They have offered diverse
products in order to appeal to public demand and to stand out amongst
competitors. KFC has lowered prices, improved customer service, united with
other fast food restaurants and established new restaurants in non-traditional
places such as Wal-Mart.
Since the first day of operations, KFC has learned countless lessons. KFC
realized the importance of focusing on the global market due to KFC popularity in
Asia. The purchase of KFC by PepsiCo taught them that a change in an
organizations management could be both effective and/or harmful to employees.
In the beginning, KFC learned that it was dismal for PepsiCo to come in, lay off
KFC managers, and replace them with PepsiCo managers. This caused an
increase employee turn-over and decreased employee loyalty. KFC also learned
that maintaining a restaurants environment is prudent to maintaining their public
image. KFC learned early on how to adapt to changes and to adjust in order to
supply the requests of the public, which makes KFC a powerful presence in the
fast food industry.
We two methods to evaluate the strategy of he company qualities method and
quantitative method, we say that if the objectives of the company are achieving it
means that its strategy is working properly so the quantitative data shows that
the KFC sales are growing year by year so it working well.
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1) Organizational Goals At first glance there are no posters on the wall that
state the goals that McDonald’s are trying to each. A customer can find a list of
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the McDonald’s goals in what look to be children’s flyers round the restaurant.
The flyers stated that McDonald’s goal is “100% total customer satisfaction.” Also
if you weren’t completely happy with your meal that the restaurant would do
whatever it took to make it right. This is not a very realistic goal for a fast food
restaurant because with the amount of food that is served everyday there is no
way that every customer will be satisfied. When I got to KFC there were no
pamphlets for the customer to read. There was nothing that let the consumer
know what the company was all about. There was a large sign, which read the
slogan “Working for you.” This was what appeared to be the organization goal
and it was interesting to see that the slogan was in improper English. Although
this goal is much more realistic than the McDonald’s counterpart.
2) Organizational Structure although the structures of the two organizations
are basically the same there was two differences that I noticed. One difference is
in the specific tasks of the employees working the front. In McDonald’s there is
one person who takes your order and gets your food. Only one person is helped
at a time because the cashier has to wait for the food and then serve you. In KFC
there are two separate stations to order and then pick up your food. At the
beginning of the line the customer orders and pays in exchange for a number.
Then you move down the line to where the customer picks up the food in
accordance with the number. This greatly speeds up the lines and reduces the
waiting time. The other difference is in the management. At both restaurants
there is one manager that handles all the employees working at the time. In
McDonald’s the manager was no where to be found but in KFC the manager was
at the front letting himself be seen and talking with the customers. He also wore a
different colored uniform to signify his position in the organization.
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but the toppings aren’t added till the individual orders come. This gives the
customer a better chance of getting a fresh meal.
4) Communication there wasn’t much communication going on in
McDonald’s when we were there. The cashiers didn’t smile and weren’t that
polite when taking my order. The communication between the cashiers and the
cooks consisted of the cashiers screaming into the kitchen. The manager wasn’t
around so I wasn’t able to see the manager’s interactions with the staff. At KFC I
was welcomed by a smile. The cashiers were nice and even held a conversation
with me. The manager was out in front conversing with the staff and the
employees. The staff appeared to treat the manager as a friend instead of a
superior.
4) Environment McDonald’s environment was neither customer nor
employee friendly. Everything in the restaurant is colored brown which just isn’t
inviting to customers. The staff has pinstriped uniforms that resemble prison
uniforms. The restaurant was also badly lighted which didn’t help the color. In
KFC there were windows everywhere and the restaurant was extremely bright.
The staff wore bright colored uniforms and there was music playing which was
enjoyable for the customers as well as the staff.
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Inflation
• Consumer inflation declined considerably in Latin America.
• Exception: Venezuela and Argentina,Inflationary pressures increased in
2007, in part due to rapidly rising food prices-
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Exports
• Latin America’s export earnings increased 12.3% in 2007
• More than half of that increase came from higher export prices
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Current Account
• Strong export growth resulted in current account surpluses every year
since 2003
• Current account surplus is expected to turn into deficit as export growth
moderates while imports remain high-
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Financial Markets
• Stock markets in many Latin American countries rose to record levels in
2007
• Global financial markets have deteriorated considerably in the past few
months
• Improved economic fundamentals should help Latin America to weather
increasing volatility in financial markets80901001101201301401501601/
Employment
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Consumer spending is forecast to remain the key driver of growth, while trade
balance will subtract from real GDP
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Recommendations
Short-term:
According to the analysis, we can conclude that they shouldn’t think of expanding
before finding solutions for internal issues such as management and restaurant
menu. They should work on the management issues to create a good
surrounding where employees can be relaxed and happy. It's not advisable to
treat employees poorly. They also have to be certain that their restaurants
provide variety choices in the menu, give their customers quality food, superior
service and restaurant hygiene. KFC should always please their customers and
try to keep updating in order to keep consumers content. Otherwise, competitors
will satisfy them and will eventually outshine you as Boston did with its grilled
chicken.
Having the original recipe can slow KFC's sales; they should vary and create new
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products to maintain success and escalate their profits. Boston and Popeye's
have attracted more customers because they making what they customers want
by providing healthy snacks. So KFC must meet the customers need and enrich
their menu. The first step in expansion plan is by shutting some of the
unsuccessful stores in US which are sucking money from KFC. This will save
some money to do business I new markets which can lead to possible growth.
As it is shown, there are some problems facing KFC like unattractive US
markets, saturated market, and competition so the company should find
countries which can return above- average profits. Main factor is to have a clear
vision, untangle the international issues, be backed financially to lead and
compete globally before starting in any expansion.
• Offer pleasant working surroundings.
• Provide the menu with healthy food
• Save by closing unprofitable restaurants.
• Choose attractive countries for the business.
Long Term
They are in demand of observing and keeping an eye on their task (offer
consumers the best food, royal service and restaurant cleanliness) and be aware
of the ways to accomplish their long term goals. Keep in mind that customers
love to try new products. They also have to race to keep up with the rapid
changing needs and new trends of the customers in order to satisfy them.
They wish to maintain the best image by treating employees fairly and putting
strict regulation over franchise to firmly follow the company's procedures.
By observing the American market, they must challenge the competitors by
keeping an eye on mergers and owning new stores as did McDonald's by
purchasing Boston. If only KFC was faster in acquiring Boston, it would avoid
great loss and competition. They have to continue working on the strategy of low
cost / changing by investing on their best powers like economies scales ,
negotiating for good deals and popular famous image/ brand all over the world.
They should be trained to use technology effectively to produce more and stay in
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KFC & Global Fast Food Industry
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KFC & Global Fast Food Industry