CASE STUDY

KENTUCKY FRIE

D CHIC

KEN AND T

HE GLO

BAL FA

ST-FOOD IN

DUSTRY

Shadman Sakib -1264

Md. Fahad Bhuyian -1271

Md. Shariful Alam- 1287

Edward Francis Gomez-1290

Reazul Karim -1643

WE ARE ………..WE ARE ………..

INTRODUCTIONINTRODUCTIONKFC Corporation, or KFC, founded and also known as

Kentucky Fried Chicken, is a chain of fast food restaurants based in Louisville, Kentucky

KFC is a brand and operating segment, called a "concept" of Yum! Brands since 1997 when that company was spun off from PepsiCo

KFC primarily sells chicken in form of pieces, wraps, salads and sandwiches. While its primary focus is fried chicken, KFC also offers a line of roasted chicken products, side dishes and desserts

INTRODUCTIONINTRODUCTION

HISTORYHISTORY

Early Life of Colonel Sanders

Sander’s First Franchise in 1952

New Management/culture for Kentucky Fried Chicken after KFC sale for $2M

Acquisition of KFC by Pepsico/Tricon Global

Heublein Makes Changes in 1970

1980’s Profit and Expansion

HISTORYHISTORY

FROM $105 TO 7.2 BILLION IN 50 YEARSFROM $105 TO 7.2 BILLION IN 50 YEARS

1952, Col. Sanders started franchising his recipe door to door financed by his $105.00 SS Check

1964, Col Sanders had more than 600 franchised outlets in the US and Canada.

1964, Sold his interest in his company for $2 million to a group of investors.

1966, KFC went public

1969, Listed on the NYSE

1971, KFC was acquired by Heublein Inc. for $285 million.

1982, Heublein & KFC Inc. was acquired by RJ Reynolds

1986, RJ Reynolds & KFC, was acquired by PepsiCo, Inc. $840 million.

1997, PepsiCo, Inc. spined-off of its qsr’s into independent Tricon Global Restaurants.

2002, Tricon changed it's corporation name to Yum! Brands, Inc. .

NOW: Yum Brands, Inc. is the world's largest restaurant

company in terms of system units with nearly 32,500 in more than 100 countries and territories.

Yum! Brands, Inc., is a Fortune 300 company Yum! Brands, Inc. global system sales totaled more than

$22 billion in the year 2001. Current Market Cap value on the NYSE is 7.2 Billion

FROM $105 TO 7.2 BILLION IN 50 YEARSFROM $105 TO 7.2 BILLION IN 50 YEARS

KFC AT PRESENTKFC AT PRESENT

KFC AT PRESENTKFC AT PRESENT

The organization is currently structured with two divisions under PepsiCo

PepsiCo Worldwide Restaurants

PepsiCo Restaurants International

Both of these divisions of PepsiCo are based in Dallas

David Novak is president of KFC

STRATEGYSTRATEGYThe strategy of KFC is to improve operating

efficienciesThey emphasized 1. Cleaner restaurants, 2. Faster and friendlier service, and3. Continued high-quality products.

They gave the responsibilities to restaurant franchises and marketing managers

OBJECTIVEOBJECTIVETo take advantage of potential growth in other country to

establish a strong position and develop image

Key success factors are ever continuing, cost saving through R&D, innovation and use of new technology to work efficiently

These success technology will lower cost and increase profit

Expansion of business whether world wide business or just to open up a few more restaurants to provide a better service/faster service/better customer service to beat competitors such as McDonald's, Burger King, Pizza Hut etc

PRODUCTS OFFEREDPRODUCTS OFFEREDKFC has also met the changing demands of society.

As the world has gone to a more healthy living, KFC has come out with many changes on its menu

Honey BBQ Chicken,

Popcorn Chicken,

Rotisserie Chicken

Chicken sandwiches

chicken pot pies

Crispy chicken strips

Mashed potatoes and gravy

Potato wedges

PRODUCTS OFFEREDPRODUCTS OFFERED

MISSION & PROBLEM/ISSUEMISSION & PROBLEM/ISSUE

MISSION

1. To sell food in a fast

2. Friendly environment that appeals to pride conscious, health minded consumers

PROBLEM/ISSUE

How would KFC maintain a market leadership in the global fast-food industry?

Issue:

A competitive marketing strategy in the international market

FOUR P’S OF MARKETING MIXFOUR P’S OF MARKETING MIX

PRODUCT: KFCPRODUCT: KFC

Anything that can be offered to a market to satisfy a want or need

KFC’s specialty is fried chicken served in various forms

KFC’s primary product is pressure-fried pieces of chicken made with the Original Recipe®

KFC also offering Extra Crispy™, Colonel's Crispy Strips®, Zinger burger and Veggie burger

PRICE: KFCPRICE: KFC

Price is the sum of all the values that consumers exchange for benefits of having or using the product or services

KFC globally enters the market using market skimming

KFC products are priced high and target the middle to upper class people

Gradually they trickle down the prices focusing on the middle to lower class people to penetrate both sides of market

PRICE: KFCPRICE: KFC

PLACE: KFCPLACE: KFCTarget Areas

“Free home Delivery” strategy is provided by KFC in select countries

Accessibility resulting in several outlets to cater to the needs of people in & around he city

Hectic lifestyle of office going individuals the fast food concept saves time of preparing food and give a consumer a full meal quickly

Economically convenient to the pricing appeals to the many classes of a society

PROMOTION: KFCPROMOTION: KFC

Promotion is the method used to inform and educate the chosen target audience about the organization and its products

The logo of the smiling Colonel is probably one of the most recognized faces in the world and instantly brings the image of fried chicken to one’s mind.

PROMOTION: KFC CONT.PROMOTION: KFC CONT.

KFC and its new company jingle, “finger lickin good” is a frequent announcement on:

Television and Radio

Print & Electronic Media

In House publicity and by phone

Media Broadcasts i.e. Billboards, Flyers, News papers

Internet i.e. Website, Social site

KFC TODAYKFC TODAY

Today

KFC is the world’s largest and most well known chicken restaurant chain

More than 10,000 locations worldwide, in 78 countries

KFC and its franchisees employ more than 200,000 people worldwide

KFC serves more than 4.5 billion pieces of chicken annually, to approximately 12 million customers enjoy their “finger lickin’ good” chicken a day, worldwide

SWOT ANALYSIS: KFCSWOT ANALYSIS: KFC

PORTER’S FIVE COMPETITIVE FORCES: KFCPORTER’S FIVE COMPETITIVE FORCES: KFC

THREAT OF NEW ENTRANTS: KFCTHREAT OF NEW ENTRANTS: KFC

KFC is a well established multi-national with no equally big direct competitor in business

However it operates in the industry that has moderate barriers to entry, hence; it faces a threat by new firms: both local and multi-nationals

RIVALRY AMONG EXISTING FIRMS: KFCRIVALRY AMONG EXISTING FIRMS: KFC

Large scale companies like KFC do not indulge into price wars and intense rivalry!

Instead they focus on differentiating their product and animate selling efforts to compete in the market

THREAT OF SUBSTITUTE PRODUCT: KFCTHREAT OF SUBSTITUTE PRODUCT: KFC

KFC faces a lot of threat from its substitutes!

Especially with growing health concerns among its customers

BARGAINING POWER OF BUYERS: KFCBARGAINING POWER OF BUYERS: KFC

The customer base of KFC is huge and one single customer does not have much bargaining power

KFC tries to listen to each and every buyer via feedback and opinion cards

BARGAINING POWER OF SUPPLIERS: KFCBARGAINING POWER OF SUPPLIERS: KFC

Suppliers on the other hand do possess some bargaining power, especially when talking about K n Ns and Pepsi

Although, none of the two wants to lose association with KFC

The company and its suppliers however, remain each other’s beneficiary and do what they can to benefit each other

KFC IN BANGLADESHKFC IN BANGLADESH

Transcom Foods Limited, a concern of Transcom Group is the franchisee of KFC in Bangladesh.

The first ever KFC restaurant has been opened in September at Gulshan, Dhaka with a seating capacity of 178 persons.

PORTER’S DIAMOND MODEL: KFC IN BDPORTER’S DIAMOND MODEL: KFC IN BD

Factor Condition Demand Condition Related & Supporting Industries Firm Strategy, Structure & Rivalry

RECOMMENDATIONS: SHORT TERMRECOMMENDATIONS: SHORT TERM

Introduce new recipes suited to local taste

Introduce cheaper items in the menu

Introduce healthier recipes

Differentiate through good service

Work on the image of a healthy fast food chain through advertising

RECOMMENDATIONS: LONG TERMRECOMMENDATIONS: LONG TERM

Change the image of KFC from fried to ‘healthy’

Open up new outlets in Urban locations

Engage is CSR activities related to animals & environment

Develop a strong culture of good service

CONCLUSIONCONCLUSION

The best maxim here is

‘Think Globally, Act Locally’

Thank You!