Welcome to KFC

About The Industry

Fast Food Industry

Fast food restaurants represent one of the largest segments of
the food industry
With over 200,000 restaurants.
$120B in sales in the U.S. alone
Fast food restaurants, also known as quick service restaurants
(QSRs)
Highly fragmented industry with top 50 cos. Having 25%
market share.
Among the major fast food chain hamburger restaurants are
50% of the market, while sandwich, pizza, chicken, snack
shops are 10% each.
Customers consume 60% of food off-premises.




Major players in fast food in India

McDonalds 479 outlets
KFC 263 outlets
Pizza hut 147 outlets
Dominos Pizza 274 outlets
Caf Coffee Day 833 outlets
Barista 200 outlets

About The Company
YUM! Brands Inc.
Yum! Brands Inc. (NYSE: YUM) is the world's largest fast food
company

35,000 restaurants

Present in over 110 countries

Yum! Brands, Inc. global system sales totaled more than $22
billion

Yum! Brands, Inc., is a Fortune 300 company

Yum restaurants include KFC, Pizza Hut, Taco Bell, Long John
Silvers (LJS), A&W, Pasta Bravo, Wing Street, and East Dawning
Macro Factors
Micro Factors
KFC
Graphic 3 (Source: Kotler et al 2003)
Micro Environment
Company Competitors
Consumers
Internal Factors SW
Strengths
Multi branding Strategy for
YUM!

Goodwill and reputation

Employee Loyalty

Global Expansion

Customer Loyalty

Ranks highest among all
chicken restaurant chains


Weaknesses
Conflicting Corporate Cultures

No defined target market

Time it takes to market new
products

losing market share

Lack of Localisation Strategy
External Factors OT
Opportunities
International Appeal to
American products

Economies of Scale and
Scope

Large Youth population

New variety
Threats
Growing Competition

Consumer health food
trend

Saturated fast food
industry

Segmenting KFC
Geographic
Region- Calcutta, Delhi, Bangalore,
Hyderabad, Mumbai
City- Urban Areas, metros
Demographic
Targeted on: upper- middle, middle
Family- full nest
Psychographic
Motivations
Personality
Perceptions
Learning
Primary objective is to take advantage of the
potential growth in other countries, to establish a
strong position and to develop their image.

Key Success Factors are ever continuing cost
savings through R&D, innovations and use of new
technology to work efficiently.

These success techniques will lower costs and
increase profits in the industry.


Some Basic Strategies
Some Basic Strategies
KFC uses an integrated low cost/ differentiation
leadership, since it can count on its brand name and
original taste and recipes to be unique while at the
same time compete on price using the benefits of
cost savings from economies of scale.
KFC in India Case Study Assignment
(Ethical Issue)
The case highlights the ethical issues involved in
Kentucky Fried Chicken's (KFC) business operations in
India. KFC entered India in 1995 and has been in
midst of controversies since then. The regulatory
authorities found that KFC's chickens did not adhere
to the Prevention of Food Adulteration Act, 1954.
Chickens contained nearly three times more
monosodium glutamate (popularly known as MSG, a
flavor enhancing ingredient) as allowed by the Act.
SI NCE THE LATE 1 990S, KFC FACED SEVERE PROTESTS BY
PEOPLE FOR ETHI CAL TREATMENT OF ANI MALS
( PETA) , AN ANI MAL RI GHTS PROTECTI ON ORGANI ZATI ON.
PETA ACCUSED KFC OF CRUELTY TOWARDS
CHI CKENS AND RELEASED A VI DEO TAPE SHOWI NG THE
I LL- TREATMENT OF BI RDS I N KFC' S POULTRY FARMS.
HOWEVER, UNDETERRED BY THE PROTESTS BY PETA AND
OTHER ANI MAL RI GHTS ORGANI ZATI ONS, KFC
PLANNED A MASSI VE EXPANSI ON PROGRAM I N I NDI A.
Cont
"Each bird whom KFC puts into a box or a bucket had
a miserable life and a frightening death. People would
be shocked to see our footage of a KFC supplier's
employee who walks through a barn, carelessly
lighting lamps and letting flames fall on the terrified
birds. The air inside these filthy barns reeks of
ammonia fumes, making it difficult for the birds to
breathe. No one with a grain of compassion should set
foot in KFC."
- Ingrid Newkirk, Director, PETA.