ESL Falcons IM 24

Midtem study case

DIFFERENTIATE BETWEEN PIZZA HUT AND BURGER KING INTERNATIONAL

STRATEGIES

Group 5

Presented to:

Dr / Nermin Danial
Presented by:

Burger king team Pizza hut team

Hebatallah saed abdelgawad mohamed Mostafa Mohamed Omar Elwakil

Mostafa mahmoud Sayed Mahmoud Nahla Shaibah El-hamed Sayed

Sherweet Ibraheem Mostafa Attia Noha Abdullah El-zahar

TABLE OF CONTACT

Introduction : ..........................................................................................................................................................................................................3
1. Pizza Hut Overview: ........................................................................................................................................................................................4
1.1 Business profile .....................................................................................................................................................................................4
1.2 History of Pizza Hut : .............................................................................................................................................................................5
1.3 Pizza Hut Mission Statement : ..............................................................................................................................................................6
1.4 Pizza Hut’s Vision Statement ................................................................................................................................................................6
1.5 Pizza Hut’s Core Values .........................................................................................................................................................................6
1.6 Pizza Hut analysis ..................................................................................................................................................................................7
1.6.1 SWOT analysis ..................................................................................................................................................................................7
1.6.2 Pizza Hut PESTLE Analysis .................................................................................................................................................................7
1.6.3 porter five forces : ............................................................................................................................................................................9
1.6.4 competitave analysis : ....................................................................................................................................................................11
2. Franchising:...................................................................................................................................................................................................12
2.1 Franchising as a concept : ..................................................................................................................................................................12
2.2 Type of franchising : ............................................................................................................................................................................13
2.2.1 Product-trade name franchising ....................................................................................................................................................13
2.2.2 Business format franchising ...........................................................................................................................................................13
2.2.3 Conversion franchising : .................................................................................................................................................................13
2.3 Advantages of Franchising : ...............................................................................................................................................................14
2.4 Top 100 Franchises 2020 ....................................................................................................................................................................14
2.5 Pizza Hut Franchising overview ..........................................................................................................................................................14
3. International marketing strategy: ................................................................................................................................................................14
3.1 An Overview of the Global Strategy Pizza Hut: ..................................................................................................................................15
3.2 International Marketing Coordination: ..............................................................................................................................................15
4. Collaboration: ...............................................................................................................................................................................................15
4.1 Pros .....................................................................................................................................................................................................16
4.2 Cons.....................................................................................................................................................................................................16
5. From your point of view is it a success or failure case. ..............................................................................................................................16
5.2 CSR (Corporate Social Responsibility) Pizza Hut is also the proprietor of The Literacy Project, an initiative designed to enable ifelong
love of reading. The program is rooted in the foundation set by the Pizza Hut BOOK IT! Program, which is the longest-running corporate
5.3 GPS Hospitality Expands Portfolio with Yum! Brands Partnership .....................................................................................................17
1. Burger king Overview: ..................................................................................................................................................................................19
1.1 Business profile ...................................................................................................................................................................................19
1.2 History of Burger king : ......................................................................................................................................................................20
1.3 Burger King Mission Statement : ........................................................................................................................................................21

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 1.4 Burger king vision statement : ............................................................................................................................................................21
1.5 Burger King Values : ............................................................................................................................................................................21
1.6 Burger king analysis : ..........................................................................................................................................................................22
1.6.1 SWOT analysis : ..............................................................................................................................................................................22
1.6.2 PESTEL analysis : .............................................................................................................................................................................22
1.6.3 Porter five force : ............................................................................................................................................................................25
2. Franchising....................................................................................................................................................................................................27
2.1 Burger King Franshising over view ......................................................................................................................................................27
2.2 Types of Burger King Franchises: ........................................................................................................................................................27
3. International marketing strategy: ................................................................................................................................................................29
3.1 An Overview of the Global Strategy Burger King:...............................................................................................................................30
3.2 International Marketing Coordination: ..............................................................................................................................................30
Revenue of Burger King worldwide 2004-2019 ..................................................................................................................................................30
4. Collaboration: ...............................................................................................................................................................................................31
- GPS Collaboration with Pizza Hut .......................................................................................................................................................32
REFERENCES..........................................................................................................................................................................................................34

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Introduction :

An Introduction to Franchising is designed to introduce young people to the fascinating world of franchising. Many
people think of fast food restaurants like McDonald’s, Burger King, and Pizza Hut’s, when they think of franchising.
But there are many more types of franchise businesses. One out of every three dollars spent by Americans for
goods and services is spent in a franchised business. Homes are bought and sold through franchised real estate
companies. The same homes can be cleaned, painted, and carpeted through a franchise.

Franchising is a wonderful way to go into business for yourself, but not by yourself. Franchising is an example of
teamwork at its best, bringing together the talents of a dedicated corporate staff and management team with the
hard work, zeal and entrepreneurial spirit of franchisees at the local level to serve our customers here in the U.S.
and around the world. This paper is about franchising between two large companies around the world : Pizza hut
and Burger king. We will explain the history of the two companies and their business plans. We then will go further
by analysing their capabilities and their position in the market. Then we will explain their plans in franchising and
the collaboration between the two companies.

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 Pizza Hut
1. Pizza Hut Overview:
1.1 Business profile

Logo used from 1974–1999; it was brought back in

2019

Type
Wholly owned subsidiary

Industry
Restaurants

Founded May 31, 1958; 62 years ago

Wichita, Kansas, U.S.

Founders DanCarney - Frank Carney

Headquarters 7100 Corporate Dr., Plano,

[1]
Texas
Franchising Since:
1959

Number of 18,703 restaurants worldwide

locations (2020)[2]

Key people Micah Cory (President Pizza Hut

U.S.)[3]

Products Italian-American.cuisine
pizza · pasta

• Yum! Brands worldwide

Parent
outside of China
• Yum China within China

Website pizzahut.com

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1.2 History of Pizza Hut :

Pizza Hut is an American restaurant chain and international franchise . It provides Italian-American cuisine, including
pizza, pasta, side dishes and desserts. It has 18,703 restaurants worldwide as of December 31, 2019, making it the
world's largest pizza chain in terms of number of locations. It is a subsidiary of Yum! Brands, Inc., one of the world's
largest restaurant companies.

- Pizza Hut was founded on May 31, 1958 by two Wichita State University students, Dan and Frank Carney brothers,
as a single location in Wichita, Kansas. Six months later, a second outlet was opened and six Pizza Hut restaurants
opened within a year.

- In 1959, the brothers started franchises. The famous Pizza Hut building was designed in 1963 by Chicago architect
George Lindstrom and completed in 1969. PepsiCo bought the Pizza Hut in November 1977.

- 20 years later, PepsiCo spun off Pizza Hut (alongside Taco Bell and Kentucky Fried Chicken) on 30 May 1997, and
the three franchise restaurants became part of a larger corporation called Tricon Global Restaurants, Inc.

- The company took over the name of Yum! Products on 22 May 2002.

- The company announced a rebrand that began on November 19, 2014, in an effort to increase sales, which had
dropped in the previous two years. The menu was expanded to introduce various items such as crust flavors and 11
new specialty pizzas. Work uniforms for employees were also refreshed.

- In 2017, Pizza Hut was listed by UK-based company Richtopia at number 24 in the list of 200 Most Influential
Brands in the World.

- On June 25 and 27, 2019, it was announced that Pizza Hut had brought back their logo and red roof pattern, which
was used from 1976 to 1999.

- On August 7, 2019, Pizza Hut announced its intention to close about 500 of its 7,496 dine-in restaurants in the US,
by the middle of 2021

- In March 2020, several Pizza Hut locations in Western New York temporarily closed due to the COVID-19 pandemic.
On July 22, 2020, a statement was released by a company spokesperson from Pizza Hut saying that all 17 locations
in the area have closed. The statement said, "As a result of 17 Pizza Hut dine-in restaurants in Western New York
initially closing temporarily due to COVID-19 restrictions, the local franchisee made the decision to permanently
close these stores. However, Pizza Hut has new franchisees coming into the New York region, and we are hopeful
we will be able to serve our customers in this area again in the future .

- On August 18, 2020, it was announced that Pizza Hut will be closing 300 restaurants after the bankruptcy of NPC
International, one of its franchise providers. A company representative stated, "We have continued to work with
NPC and its lenders to optimize NPC's Pizza Hut restaurant footprint and strengthen the portfolio for the future, and
today's joint agreement to close up to 300 NPC Pizza Hut restaurants is an important step toward a healthier
business .

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 1.3 Pizza Hut Mission Statement :

“TO TAKE PRIDE IN MAKING THE PERFECT PIZZA WHILE PROVIDING COURTEOUS, HELPFUL
SERVICE AT ALL TIMES, STRIVING TO HAVE EVERY CUSTOMER SAY THAT THEY PLAN TO BE
BACK.”

Analysis for mission statement :

Pizza Hut mission can be analyzed by dividing it into several points and their indications :

- “Take pride in making the perfect pizza” : This is a hint that Pizza Hut needs to stand out from other pizzerias.
It evokes the idea that new, local products would automatically generate a curiosity in the brand.
- “Providing courteous, helpful service at all times” : Reflects the brand's willingness to have consumers enjoy
their dining experience in any way they can. The internal love for pizza is inferred from these terms, such
that each slice represents the pride of the brand.
- “That they plan to be back” : Shows the Pizza Hut's aim is to concentrate on routine company with any step
taken. This aspect illustrates the disparity in marketing costs that businesses face as they approach new
buyers versus repeat consumers.
1.4 Pizza Hut’s Vision Statement

“TO IMPROVE THE WELL-BEING OF OUR CUSTOMERS, COMMUNITY, AND PEOPLE

CONNECTED TO OUR ENTERPRISE”

Analysis for vision statement :

Pizza Hut's vision focuses on three practical strategies to achieve its goal:
- It works to become the best employer for people in each community. Then the company strives to offer
what it calls “optional excellence” to customers in each restaurant, take-out, or delivery scenario.
- That means the brand looks for ways to encourage employees to over-deliver on each order in some way.
- Then Pizza Hut encourages each franchise owner to achieve enduring profits by looking for ways to innovate
every day. Without new research and development investments, there is no way to make the desired
improvements.
1.5 Pizza Hut’s Core Values

The core values of Pizza Hut are integrity, excellence, profitability, and organizational growth.
Analysis for pizza hut core values :

- These four facets of the philosophy guide decisions at any stage of government.
- This method allows every worker to face every obstacle that comes their way. By supplying workers with
training opportunities that will enable them to be successful, Pizza Hut aims to meet the highest
expectations in their industry.
- The goal is to make people feel inspired. As individuals evolve professionally, the organisation will continue
to extend its global presence.

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 - Pizza Hut extends its fundamental principles to any area of its industry in order to track and boost revenue
wherever possible. This work builds shareholder trust, meaning that customers will be proud of their
abilities to make a great pizza every time

1.6 Pizza STRENGTH WEAKNESS Hut

analysis 1. Unmatchable quality & variety 1. Inadequate advertisements
2. Strong brand image 2. Inadequacy of outlets
3. Customer satisfaction 3. High price
4. Hygiene 4. Lack of parking facilities at outlets
5. Excellent services.

OPPORTUNITY THREAT

1. Growing fast food market Scope for 1. Emergence of Papa Jone’s World's #pizza
expansion makers
2. Produce attractive offers 2. Low price points of competitors
3. No take away counters for pizza's

1.6.1 SWOT analysis

1.6.2 Pizza Hut PESTLE Analysis

Political Factors
Pizza Hut is a leading pizza restaurant brand and has expanded its reach all over the world. From
United States to third world states in Asia, it is critical for businesses to take various political factors
into account. The actions of the government and the policies framed by them define the success of the
business and determine the ease with which business can be carried out without any hindrances. If the
government is supportive towards the increase in the number of outlets of Pizza Hut, then that would
further increase employment opportunities in the area. The entertainment facilities would also increase
for the local people. The particular laws such as the contract law, that the government enforces define
the long-term financial health of the business as they dictate the clear lines, upon which the company
has to operate. For food chains like Pizza Hut these policies are especially important as friendly policies
help them to establish outlets with ease and also operate them efficiently

Economic Factors
Nations with macroeconomic system have a direct effect on business chains such as Pizza Hut.
Similarly, gross domestic product, unemployment rates and inflation rates of the region affect the
business in a broader sense. The more amount of foreign direct investment influx in the state, the
larger number of franchises of Pizza Hut will be constructed. The economic factors also include the
consumer burying and overall expenses design. People spend more amounts of money in the
beginning of the month and visit the outlet more often. The efficiency of the operation of the financial
markets has a profound impact on the ability of Pizza Hut to raise capital at a fair price. If inflation
increases the cost of the raw material then this leads to high prices for the products

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 Social Factors:
Since Pizza hut is a multinational brand, whose origination can be traced
back to America, the entire organization is overwhelmed by western
culture. Every country has cultural norms, values, beliefs and religion
which affect the working of the organization. Factors such as Demographic
and life expectancy of people affect the fact that whether a franchise of
Pizza Hut can be established. The area with high life expectancy and
greater urban population have better sales and thus better profits.
Preferences of the local people affect profitability to a great extent.
Developed nations have people which are prone to fast food, which leads
to greater sales and better profits for the company. The class distribution
is also very important as a premium brand such as Pizza Hut would not be
able to obtain sales if it promotes its products among general public where
majority of the people belong to lower class

TECHNOLOGICAL FACTORS:
In order to prevent obsolescence in the future by a company it is important that the brands
constantly innovate and create with the help of new disruptive technologies. In the 1990s Pizza
Hut had the largest profits in the industry. With the 2000s and probably after 2007, a number of
new chains like Pizza Hut surfaced into the market. Now, in order to deal with the competition
Pizza Hut launched new ideas to stay relevant in the market. The current industry trends have
also increased the sales of the company. The ease of ordering of food from online portals along
with the discounts offered has had a positive impact on profitability. They have invested in
customer centric technologies such as computer-based customer data that is MIS (managing
information system) which acts as a direct aid in collecting data of the customers, conducting
daily transactions, forecasting the future and decision making. Even the entrance of new and
efficient vehicles would make their service efficient.

LEGAL FACTORS:
Respecting and diligently following the laws and regulations of a particular business
state in which a food chain is working dictates the value of the business. For the
company to maintain the taste as well as the quality of its Pizza, the owner and
managerial staff of Pizza Hut should focus upon adhering to all standards. Big brand
names are required to be in compliance with the current industry laws pertaining to
health and safety of its labor. The company in the past has faced issues regarding non-
compliance with fair work laws. Following an audit of 32 branches of Pizza Hut, the
inspectors found out that 28 branches were not adhering to fair work laws. The
investigation revealed that a franchise in Newcastle failed to pay $19762 to its 24
employees in November 2015 and May 2016. The brand faced criticism from Fair
Work Ombudsman (FWO), who accused the fast-food giant in a large media release on
account of failing to pay heed to the concerns of the agency for non-compliance of the
regulations of the network

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 ENVIRONMENTAL FACTORS:
Those companies which produce large amounts of waste may attract hefty fines and also be
required by law to change their environmental habits. Factors such as Hygiene and trends related
to recycling need to be considered by food chains like Pizza Hut. The brand has a comprehensive
policy for the use of tropical commodities such as soy, palm oil and beef, so that the company
doesn’t contribute towards destruction of tropical rainforests. The Pizza Hut brand focuses on
minimizing, reducing and compensating for carbon emissions. They have several initiatives for the
same as green building and energy efficiency.
The company is the founding member of The UK Plastics Pact which is a collaborative initiative to
bring businesses together and provide a direction to the governments as well as NGOs for the
issue of management of plastic. Pizza Hut took a step further towards sustainability by eradicating
the use of plastic straws and introducing paper straws in replacement. The company has invested
over £1.5m in new smart meters, LED lighting and signage which are environmental measures
taken to reduce carbon footprint

1.6.3 porter five forces :

Competitive rivalry : (very High )

Due to the growth and pervasiveness of information technology all fast food companies become more
technological companies. All of these companies are trying to keep the existing customer as well as they
are more likely to cater to the new customer base. So fast food companies always differentiate their
products and they are more innovative. Because of the present customers can easily compare with other
fast-food companies in their product line. PIZZA hut also tries to expand its business providing different
and quality products to their customer. The online purchasing concept is a better example and they
implement this concept when it’s come to the fast-food industry. many Fast food companies are doing
their operation. KFC, Burger King, Domino’s PIZZA, MacDonald, etc. these companies offer some kind of
food for the market. Domino’s PIZZA is the direct competitor of the PIZZA hut. It also provides the same
services relating the purchasing via the internet for the public. They also provide an online ordering
system through a web site. So PIZZA Hut Company has a huge competition to cater to the customer.
Threat to Entry : ( Low)

PIZZA Hut uses different types of technologies for its activities. These days they provide mobile apps for
purchasing and online purchasing through the web site for their customers. They use to differentiate their
services using mobile apps for smartphones. These are the latest technologies in the world. So these
technologies are most expensive and advance for the newcomer to the industry, they have to spend a
huge cost to implement these technologies. More capital required to enter the industry. PIZZA hut use
identifies to customer’s location when they are accessible to the web site using a tracking system.
Therefore high threat to entry to the market and also experience is important to retain the market.

PIZZA HUT has more experience than other food companies. Because of PIZZA HUT operating worldwide.
Therefore PIZZA HUT has more experience.

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 PIZZA hut the company uses inventory handling management via the internet to identify the amount of
their inventory in hand and according to the amount they order raw materials from their supplier through
the e-commerce application call online inventory control.

New entries cannot easily implement these types of internet-based technologies. Because of the
differentiation of their services others cannot easily imitate without incurring a high cost.

Buyer power ( LOW )

PIZZA Hut Company is the market leader of the fast-food industry. They maintain this position using their
stranded and quality products and services. Because of the market leader position PIZZA HUT not
facilitate bargaining to customers. According to this situation, buyer power is very law. But PIZZA HUT has
to properly maintain their business strategies and competencies to gain a better advantage for the
company and pricing strategies and quality is the most important to retain their position. Customers have
more alternative choices to move to a competitor. These days customers are using the internet and they
compare products with a competitor. They make decisions base on their opinion. According to this
situation customer have some ability to affect to PIZZA HUT by the shift to Domino’s PIZZA etc.

Threat of Substitutes ( High )

many fast food companies are doing them the operation, among them, Domino’s pizza is the direct
competitor of PIZZA hut. Domino’s pizza has the same capabilities to reach its customers compared with
PIZZA HUT. They produce the same pizza for the public and some people are likely to buy Domino’s pizza
because of the Domino’s pizza can buy a cheaper price compared with PIZZA HUT. So Domino’s pizza the
direct affecting substitutes for the selected company. Some people are not like to consume pizza and they
like to eat products of the KFC. So KFC also has a greater customer base.

KFC products affect the PIZZA HUT to reducing the customer base of PIZZA HUT. KFC Company provides
an online ordering system to combine with Kapruka.lk. Because of this substitute product of the PIZZA
HUT has to maintain good.

competitive strategies to retain their customers. Above mention companies also use more technological
equipment and e-commerce application to reach their customers

Supplier power : ( LOW )

PIZZA HUT concern about quality products provides to their customers. So the company considers the
quality of raw materials for its production process. PIZZA HUT directly links with the international
supplier, because PIZZA HUT is an international company. They import like cheese from the international
supplier. So suppliers have more power because there is less number of quality raw materials suppliers in
the market. Not only that PIZZA HUT buys raw materials from the Sri Lankan market. Flour buy from
Prima and sausage get from the Keels Company. Recently PIZZA hut implements a system to identify their
inventory and order raw materials through the internet using e-commerce application and all the outlets
can purchase raw materials from above mention supplier. This concept is more efficient rather than raw
materials coming from the head branch were the house. In this situation supplier power also high
because there are less number of well-reputed companies in the market and PIZZA Hut Company cannot
shift to another raw materials company without incurring a high cost.

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1.6.4 competitave analysis :
first number about pizza industry

Pizza market share :

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Analysis for The largest major competitor ( dominos pizza and papa johns pizza )

Pizza hut Competitive Advantage ":

- Strong relationships with suppliers : By Using the YUM! Brand & PepsiCo they hold their suppliers to a
Suppliers Code of Conduct
- Pizza Hut's locations : Located in busy tourist areas, mall-food courts, Target stores, and high traffic, easy to
access locations Follow a high standard with CHAMPS
• Cleanliness
• Hospitality
• Accuracy
• Maintenance
• Product
• Speed
• Pizza Hut achieves efficient internal operations by

2. Franchising:
2.1 Franchising as a concept :
Franchising can be considered a ‘generic strategy’ from two viewpoints:
A- it represents strategic choices made by the firm
B- it is a form of strategic alliance between organizations.
C- Strategy reflects the managerial decisions made to adapt the firm to its environment.

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 D- Compared to other forms of alliances, franchising is moderately low in both risk and interorganizational
dependence." The costs of growth using franchising are usually greater than the costs associated with
licensing but less than those associated with joint ventures because most of the initial investments are
borne by the franchisees.
E- Moreover, due to continuing economic and contractual ties, franchising offers an opportunity for greater
control of the alliance partner than do many other forms of alliances
2.2 Type of franchising :
2.2.1 Product-trade name franchising
refers to alliances in which the franchisee distributes the franchisor’s product under the franchisor’s
trademark such as Coca Cola and its bottling companies.
2.2.2 Business format franchising
This type of franchising, also known as a ‘package franchise’, provides the franchisee with a product/ service,
trademark, methods of operations, and ongoing guidance by the franchisor.
For example, Park America, a franchised valet parking service, includes the following in their franchise
package: training, a computer and printer, a bookkeeping system, uniforms, promotional brochures and
flyers, parking tags and signs, stationery, and an operations manual.
2.2.3 Conversion franchising :
refers to the development of a franchise system primarily through the conversion of independent, going
concerns into members of a franchise system. Best Western Hotels has achieved second place (i.e. number of
rooms) in the U.S. lodging industry by attracting existing independent operators to its franchise

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 2.3 Advantages of Franchising :
Regardless of the form of franchising chosen, the advantages of using a franchise strategy to the franchisor
are:
• access to capital at lower risk;
• cost sharing;
• rapid market penetration at a relatively lower cost than establishing one's own distribution system;
• economies of scale;
• a motivated workforce of individual entrepreneurs.
• For the franchisee, it provides an opportunity to enter a business at less cost with a proven product/service
or brand name.

2.4 Top 100 Franchises 2020

Franchise Direct has compiled its ranking of the Top 100 Global Franchises. Browse
the list below if you would like to learn more information about the world's most
successful franchises. Franchise Direct has compiled this list after examining franchise
brands from around the world.

2.5 Pizza Hut Franchising overview

Franchisees can open up “traditional” Pizza Hut locations, which are the standalone
restaurants that you’re probably most familiar with. Some of these have sit-in dining and others are takeout-
focused.

That said, there are also “non-traditional development” opportunities through the Pizza Hut Express licensing
program. These are the smaller units that appear in places such as stadiums, airports, colleges, and more.

The fees for these types of restaurants are different and include costs for opening the franchise, an architecture fee,
and more. You’ll want to directly inquire with Pizza Hut about the details for these non-traditional locations.

3. International marketing strategy:

Pizza Hut started with local market strategy in Kansas, USA then moved on to regional markets in and across USA. In
1968, Pizza Hut started its international movement by opening its 1st restaurant in Canada. And today Pizza Hut is
world’s largest pizza chain with its presence in more than 100 countries.

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 Early Entry Strategy: Though Pizza Hut was not the first entrants in the pizza market in USA. But Pizza Hut
followed an early entrant strategy. Customers knew what a pizza is but still there was huge potential to tap. In order
to become a leader, pizza hut continued to refine their product

Adaptability
D e v e l o p a n e w p r o d u c t t o s u i t t h e i r c u s t o m e r ’ s c h a n g i n g t a s t e s . Ultimately Pizza Hut with its
superior promotion, manufacturing and distribution activities has turned out to be the “winner”.

- Strong Commitment Strategy: Pizza Hut has bee n oper ati ng in t he pizza market by realiz ing all
economies of scale in promotion, distributi on and manufact uring f a c i l i t i e s . I f P a p a J oh n s o r
L i t t l e C a e s a r s c o m e o u t w i t h a n e w competitive pricing strategy or innovative product, then Pizza
Hut quite aggressively fights back by bringing more competitive prices or better innovations in product
category. In simple words, Pizza Hut takes all possible measures to defend its leadership position in
the market.

3.1 An Overview of the Global Strategy Pizza Hut:

before entering into any new country conducts a comprehensive market survey of that country to learn about the
culture that prevails in that country, the state of government and politics, the legal framework (product quality laws,
packaging laws) , commercial practices (business structure, patterns of competition). Strategy Adopted by Pizza Hut
for Global marketing programs: Localized strategy: Pizza Hut follows the strategy of “Think Global, Act Local”. For
e.g. in India, the 1 st Pizza Hut which was launched in Bangalore served complete vegetarian meals. Similarly, in
China, along with serving Pizzas, Pizza Hut also serves “Sangria” and “Escargot” . Similarly, in India, to match the
spicy tastes of Indian consumers, Pizza Hut launched “Tandoori Treat”, “The Great Indian Treat”.
For the cheese lovers in United States, Pizza Hut launched Cheesy Bites Pizza and Stuffed Crust Pizza.
International Marketing Coordination: Pizza Hut’s international marketing activities though dispersed in
different countries are properly coordinated to gain competitive advantage as Al l mar ke t ing a ct iv iti es as
ma rk et r es ear ch, a dve rt is e me nts , a nd restaurant interiors are done using a similar method. Marketing
know-how and skills are transferred from one country to another. For e.g. the “franchising model” is used
successfully in all the countries by Pizza Hut.

3.2 International Marketing Coordination:

Pizza Hut’s international marketing activities though dispersed in different countries are properly coordinated to
gain competitive advantage as All marketing activities as market research, advertisements, and restaurant interiors
are done using a similar method. Marketing know-how and skills are transferred from one country to another. For
e.g. the “franchising model” is used successfully in all the countries by Pizza Hut

4. Collaboration:

As with any franchise opportunity, there are benefits and drawbacks to choosing to open a Pizza Hut. Here’s what
you’ll want to keep in mind:

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 4.1 Pros
National recognition: Pizza Hut is a brand with strong recognition within the U.S.—and across the world, too.
You may be able to leverage this recognition into acquiring customers, since they’ll be familiar with your
product and have expectations as to what kind of service and food your restaurant delivers.
Corporate support network: Being part of Yum! Brands, Pizza Hut is part of a large corporate support
network, which can be advantageous over other types of smaller franchises.
Strong vetting: Pizza Hut will only allow strong candidates with good credit and viable business plans to open
up stores. So, if you’re selected, it’s a vote of confidence for your ability to succeed.

4.2 Cons
High investment: Compared to some franchises, there’s a slightly higher barrier to entry to open up a Pizza
Hut franchise, and the cost can quickly climb, especially in expensive, generally urban areas. Before you
make your decision, it might be worth looking at some alternative low-cost franchise ideas if your budget is
tight.
Territory protection: Although your store is protected from another location developing within a quarter of a
mile, that’s not too much distance. This means that you may not have the protection from competition that
some other franchises may offer you.
Fast time-to-open requirement: After signing your development agreement, Pizza Hut requires that you
open your restaurant in one year—which is pretty fast considering they don’t help with construction, nor do
they offer internal financing.

5. From your point of view is it a success or failure case.

Identify the reasons that lead to the collaboration result

In this Case Pizza Hut collaborated with Burger King

Let’s begins with over view about ....

About Yum! Brands

Yum! Brands, Inc., based in Louisville, Kentucky, has over 45,000

restaurants in more than 140 countries and territories and is one of
the Aon Hewitt Top Companies for Leaders in North America. In
2018, Yum! Brands was recognized as part of the inaugural
Bloomberg Gender-Equality Index and ranked among the top 100 Best Corporate Citizens by Corporate
Responsibility Magazine. In 2017, Yum! Brands was named to the Dow Jones Sustainability North America Index.
The company’s restaurant brands – KFC, Pizza Hut and Taco Bell – are the global leaders of the chicken, pizza and
Mexican-style food categories. Worldwide, the Yum! Brands system opens over seven new restaurants per day on
average, making it a leader in global retail development

5.1 About Pizza Hut®

Pizza Hut, a subsidiary of Yum! Brands, Inc. (NYSE:YUM ), has more restaurant locations in the world than any other
pizza company. Founded in 1958 in Wichita, Kan., Pizza Hut operates more than 16,000 restaurants in more than
100 countries.

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With easy order options including the Pizza Hut app, mobile site, and Amazon and Google devices, Pizza Hut is
committed to providing an easy pizza experience – from order to delivery – and
has the only loyalty program, Hut Rewards, in the U.S. that offers points for
every dollar spent on food any way you order.

5.2
CSR (Corporate Social Responsibility) Pizza Hut is also the proprietor
of The Literacy Project, an initiative designed to enable access,
empower teachers and inspire a lifelong love of reading. The program
is rooted in the foundation set by the Pizza Hut BOOK IT! Program,
which is the longest-running corporate supported literacy program,
impacting more than 14 million students each year. For more
information, visit www.pizzahut.com. Pizza Hut is the Official and Only Pizza Sponsor of the NFL and
NCAA®

Collaboration

5.3About GPS Hospitality

Founded in 2012, GPS Hospitality is a BURGER KING®, Pizza Hut®, and
Popeyes® Louisiana Kitchen franchisee, operating more than 475
restaurants in Alabama, Arkansas, Florida, Georgia, Kentucky,
Louisiana, Maryland, Michigan, Mississippi, New Jersey, Pennsylvania, Tennessee, and West Virginia. GPS
Hospitality seeks to become our guests’ favorite QSR destination by implementing our brand values of
being Goal Focused, People Oriented and Service Obsessed. For more information, please visit
www.gpshospitality.com or follow us on LinkedIn, Facebook, Instagram and Twitter.

5.3 GPS Hospitality Expands Portfolio with Yum! Brands Partnership

GPS Hospitality, a rapidly growing franchisee with more than 400 BURGER KING® and Popeyes Louisiana Kitchen
restaurants in 11 states, today announces the next major step in the organization’s growth: the acquisition of 75
Pizza Hut® restaurants in Georgia, Alabama, Kentucky and Tennessee, bringing the grand total of GPS’ footprint to
13 states.
GPS Hospitality spent months of reflection and research to identify its third brand, and the company is excited to
solidify its agreements to acquire its newest restaurants. The Quick Service Restaurant franchisee expects to break
500 restaurants across the country this year and sees opportunities for future growth within Yum! Brands, the
parent company of Pizza Hut.

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“Pizza Hut is a mature and beloved brand with dominance in the space,” said GPS Hospitality CEO Tom Garrett. “Not

only does the brand see value in investing in its people, but also positioning itself as an industry leader with its

recent NFL sponsorship, plus innovations with its app and delivery offerings. Our partnership with Pizza Hut is a

deliberate move to align ourselves with a brand that reflects our values and business sensibilities. The addition of

the third brand and expansion into new territories are major milestones for our company.”

GPS Hospitality is also excited to announce the addition of Kent Dawdy as Vice President of Operations to

spearhead this new division within the company. Dawdy has more than 30 years of experience in the QSR industry,

including more than 20 years with Arby’s. Most recently, he worked with Atlanta-based Sterling Restaurants which

operates Shane’s Rib Shacks and Moe’s Southwest Grills.

Dawdy is no stranger to Yum! Brands, having previously held an equity position with KBP foods, a national operator

of Kentucky Fried Chicken and Taco Bell restaurants. Rounding out GPS’ Pizza Hut leadership team are Director of
Operations Zack Wilcox and Travis Kirkland, both of whom were promoted from District Leaders from the

company’s Burger King division.

“I am proud to come on board at GPS Hospitality, which has become one of the largest multi-unit franchisees in the

United States in just six years,” Dawdy said. “The company’s Goal Focused, People Oriented and Service Obsessed

values have proven itself as great groundwork with Burger King restaurants, and I have no doubt these values will

translate into success with the Pizza Hut brand.”

“Kent’s years of experience in this competitive industry already have made him an invaluable addition at GPS,”

Garrett said. “We’re so fortunate to have him, Zack and Travis leading these restaurant teams and helping to instill

our philosophy and dedication in achieving the best guest experience that is so essential to our company’s
success.”

From my point of view that it was very successful collaboration as it reflects

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 Burger king
1. Burger king Overview:
1.1 Business profile

Burger King

Logo used since July 1, 1999

Type Subsidiary

Industry Restaurants

Genre Fast food restaurant

Predecessor Insta-Burger King

Founded Insta-Burger King:

1953; 67 years ago
Jacksonville, Florida
Burger King:
1954; 66 years ago
Miami, Florida

Founder Insta-Burger King:

Keith J. Kramer and Matthew Burns
Burger King:
David Edgerton and James McLamore

Headquarters 5505 Blue Lagoon Drive, Miami-Dade County,

Florida, United States

Number of 17,796 (2018)

locations

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 Area served Global

Key people • Alexandre Behring (Chairman RBI)[1]:123

• Daniel S. Schwartz (CEO)[1]:123
• José E. Cil (President)[1]:123
• Joshua Kobza (CFO)[1]:123

Products • Hamburgers
• chicken
• french fries
• soft drinks
• milkshakes
• salads
• desserts
• breakfast

Revenue 1,970,000,000 United States dollar (2012)

Operating 363,000,000 United States dollar (2012)

income

Net income 117,700,000 United States dollar (2012)

Parent Restaurant Brands International

Website www.bk.com

Footnotes / references
[2][3]

1.2 History of Burger king :

- Founded in 1954, Burger King is a U.S.-based quick service burger restaurant chain that is also known by the
abbreviation ‘BK’.

- Since the 1950’s Burger King evolved into an international brand with more than 18 thousand Burger King
restaurants worldwide.

- In 2014, Burger King and the Canadian QSR-chain Tim Hortons merged under the parent company Restaurant
Brands International, although both restaurants maintained their individual brands and headquarters. The purpose
of the merger was to create a synergy between the two brands in terms of accessing the global market place and
improving practices within the companies.

- Additionally, on March 27, 2017, Restaurant Brands International acquired Popeyes Louisiana Kitchen, Inc. and its
consolidated subsidiaries.

- The revenue of Burger King has seen growth over the last three years reaching 1.65 billion U.S. dollars in 2018.
Despite the decrease in revenue, the number of American customers has remained steady. According to the

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American customer satisfaction index, Burger King scored 76 points out of a possible 100 points in 2018, showing a
decrease by one point, since the previous year, in overall customer satisfaction.

1.3 Burger King Mission Statement :

OFFER REASONABLY PRICED QUALITY FOOD, SERVED QUICKLY, IN ATTRACTIVE, CLEAN

SURROUNDINGS

This mission statement indicates the kind of outputs expectable from the organization. With regard to Burger King’s
business, this mission statement has the following main points:

- Reasonable prices

- Quality food Quick service Attractive

- clean surrounding

1.4 Burger king vision statement :

to be the most profitable QSR business, through a strong franchise system and great people, serving the best burgers in the
world

This vision statement directs Burger King to achieve leadership in the global quick service restaurant (QSR) industry
or fast food industry. The vision statement has the following main points regarding Burger King’s business:

- Most profitable QSR business

- Franchise system
- Great people
- Best burgers in the world

Burger King’s vision statement shows that the company aims to achieve the leading position in the quick service
(fast food) restaurant industry. At present, McDonald’s holds this top position. The vision statement also indicates
that Burger King uses a franchise system to grow. Great people and the best burgers are offered to attract one of
the biggest market shares in the industry. Thus, Burger King’s vision statement establishes the nature of the
business and its direction toward global market leadership.

1.5 Burger King Values :

- Teamwork and family

- Excellence

- Respect

• Analysis for Burger King core values :

These four facets of the philosophy guide decisions at any stage of government.

Creating a community that Burger King describes as ‘great people’ can only occur in the presence of its cooperation
and good relation.

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The company also emphasizes meeting all standards as a mark of excellence in all its operations. Coupled with
respect, Burger King, these values ensures Burger King is well suited to be the best in the world.

1.6 Burger king analysis :

1.6.1 SWOT analysis :

1.6.2 PESTEL analysis :

Political Factors
Political conditions are determinants of business performance. This part of the PESTEL/PESTLE analysis identifies
governmental influence on firms’ remote or macro-environment. In Burger King’s case, the following are the main
political external factors:
1. Governmental support for globalization (opportunity)
2. Political stability in major markets (opportunity)
3. Governmental support for e-commerce (opportunity)
Governments continually support globalization. Burger King can take advantage of this condition through global
expansion. Also, the external factor of political stability helps reduce challenges to the company’s growth and
expansion. In addition, Burger King can improve its e-commerce capabilities. In this part of the PESTEL/PESTLE
analysis, the external factors present significant opportunities for Burger King to grow and expand internationally.

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 Economic Factors
Economic conditions directly affect Burger King’s remote or macro-environment. This part of the PESTEL/PESTLE
analysis outlines the economic changes and trends that influence business performance. The following are the
main economic external factors that affect Burger King:

1. Expanding international trade agreements (opportunity)

2. Economic stability of the U.S. (opportunity)
3. High economic growth in developing markets (opportunity)

As countries implement more and expanded international trade agreements, Burger King can grow through
global supply chain enhancements. Also, U.S. economic stability enables the company to gradually grow in the
country. In relation, Burger King has the opportunity to rapidly expand in developing economies. These
conditions show that, in the political dimension of the PESTEL/PESTLE analysis model, Burger King must focus on
external factors that present opportunities for growth and expansion, especially in developing economies.

Socio-Cultural Factors
Burger King must always account for sociocultural influences in its remote/macro-environment. The social
trends and changes and their effects on consumers and employees are considered in this part of the
PESTEL/PESTLE analysis. The main sociocultural external factors affecting Burger King are as follows:

1. Increasing consumer diversity (opportunity)

2. Higher health consciousness (threat & opportunity)
3. Increasing support for animal rights (threat & opportunity)

The increasing population diversity presents the opportunity for Burger King to innovate its products to attract
consumers of various backgrounds. Higher health consciousness threatens demand for Burger King’s products,
which are sometimes criticized as unhealthful. However, the company has the opportunity to improve the
healthfulness of its products. Animal rights advocacy continues to attract attention, threatening the main
products of Burger King. Still, the firm can implement new supply chain policies to address concerns on animal
rights and welfare. This part of the PESTEL/PESTLE analysis points to Burger King’s opportunities to improve
despite the threats linked to socio cultural external factors.

Technological Factors
Burger King’s business partly relies on technologies. In this dimension of the PESTEL/PESTLE analysis,
technologies and related trends are considered in terms of their influence on the remote or macro-
environment of the firm. The following are the major technological factors affecting Burger King:
1. Higher availability of automation technologies (opportunity)
2. Higher popularity of mobile technologies (opportunity)
3. Low R&D activity in the quick service restaurant industry (opportunity)
More automation technologies are now available for businesses. Burger King can apply these technologies to
improve operational efficiency. Also, the company can tap mobile users to gain a bigger market share. Relative
to the low R&D activity in the fast food restaurant industry, Burger King has the opportunity to boost its R&D
investments to improve performance. In this part of the PESTEL/PESTLE analysis, Burger King has major
opportunities for performance improvements based on technological external factors.

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 Ecological/Environmental Factors

The environment can impose limits to Burger King’s business. This dimension of the
PESTEL/PESTLE analysis covers the impact of ecological conditions on firms’ remote or
macro-environment. In the case of Burger King, the following are the most notable
ecological external factors:

1. Climate change (threat)

2. Emphasis on business sustainability (opportunity)
3. Increasing popularity of low-carbon lifestyles (opportunity)

Climate change threatens to reduce the stability of Burger King’s supply chain.
However, the company has the opportunity to improve its sustainability status. Also,
Burger King has the opportunity to improve efficiency to attract consumers who
advocate low-carbon lifestyles. The ecological external factors in this dimension of the
PESTEL/PESTLE analysis indicate that Burger King can realistically work on sustainability
and efficiency.

LEGAL FACTORS
Burger King must comply with legal requirements. The effects of legal systems on firms
and their remote or macro-environment are considered in this part of the
PESTEL/PESTLE analysis. The major legal external factors influencing Burger King are as
follows:

1. Import and export regulation (opportunity)

2. Environmental protection laws (opportunity)
3. GMO regulation (threat)

Burger King has the opportunity to grow based on import and export regulations that
support new international trade agreements. Also, the company can enhance its
sustainability performance to exceed expectations and requirements based on
environmental protection laws. However, GMO regulations, especially in Europe, limit
the performance of Burger King, considering the widespread availability of GMO
ingredients used in the industry. This dimension of the PESTEL/PESTLE analysis
emphasizes growth and sustainability based on legal external factors.

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 1.6.3 Porter five force :
- Competitive Rivalry (Strong Force)

Burger King competes with major firms like McDonald’s and Wendy’s. The degree of competition is examined in this
aspect of the Five Forces Analysis model. The following are the main external factors that create the strong force of
competitive rivalry against Burger King:

• High number of competitors (strong force)

• High variety of firms (strong force)
• Low switching costs (strong force)

The quick service restaurant market is saturated with firms of different sizes. Burger King must also consider the
variety of firms in terms of types of products, market focus, and other characteristics. In addition, competitive
rivalry is strong partly because of the low switching costs, which correspond to customers’ ease in transferring
from Burger King to other firms. This aspect of the Five Forces analysis shows that competition is a main concern
in Burger King’s business.

Threat of New Entry (Moderate Force)

New entrants can disrupt the performance of Burger King. The effects of new entry on the fast food restaurant
industry environment are examined in this aspect of the Five Forces analysis. The external factors that lead to the
moderate threat of new entrants against Burger King are as follows:

• Low switching costs (strong force)

• Moderate cost disadvantage (moderate force)
• Moderate cost of doing business (moderate force)

Again, the low switching costs indicate that it is easy for consumers to transfer from Burger King to new firms (new
entrants). However, new entrants face moderate cost disadvantage because large firms like Burger King benefit
from economies of scale that many new firms do not have. Also, the moderate cost of doing business could pose a
financial challenge to new entrants. Based on this aspect of the Five Forces analysis, the threat of new entrants is a
considerable issue in Burger King’s business.

Bargaining Power (Strong Force)

Consumers significantly affect Burger King’s performance and the quick service restaurant industry environment.
This aspect of the Five Forces Analysis model explores the influence of customers on firms. The main external
factors that lead to the strong bargaining power of Burger King’s customers are as follows:

• Low switching costs (strong force)

• High substitute availability (strong force)
• Moderate presence of consumer organizations (moderate force)

The low switching costs correspond to the ease of transferring from Burger King to other companies. This condition
empowers customers to make decisions that directly affect Burger King’s business. In addition, there are many
substitutes to Burger King’s products, thereby giving consumers more choices. The presence of consumer
organizations, such as Consumers Union and Better Business Bureau, further increases the bargaining power of

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buyers. Burger King must consider customers’ demands as one of its main business concerns, as indicated in this
aspect of the Five Forces analysis.

Threat of Substitutes (Strong Force)

Substitutes technically compete against Burger King’s products. This aspect of the Five Forces Analysis model
determines the influence of substitution in the fast food restaurant industry environment. In Burger King’s case, the
following are the main external factors that contribute to the strong threat of substitution:

• Low switching costs (strong force)

• High availability of substitutes (strong force)
• Satisfactory performance of substitutes (strong force)

Customers can easily transfer from Burger King to substitutes (low switching costs). In addition, there are many
substitutes to choose from, including fine dining restaurants and home cooking. These conditions strengthen the
threat of substitution against Burger King. Also, most of these substitutes are satisfactory in terms of taste, cost,
quality, and other criteria. This aspect of the Five Forces analysis indicates that substitutes significantly affect Burger
King’s business.

Suppliers Power (Weak Force)

Suppliers affect the quick service restaurant industry environment through variables like pricing and supply control.
The impact of suppliers on firms like Burger King is considered in this aspect of the Five Forces analysis. The
following are the major external factors that create the weak bargaining power of Burger King’s suppliers:

• High number of suppliers (weak force)

• High overall supply (weak force)
• Low forward integration (weak force)

There are many suppliers that compete to provide their products to firms like Burger King. In relation, there is an
abundance of supply of raw materials and ingredients. These conditions limit the influence of suppliers on Burger
King and other fast food restaurant firms. Also, most suppliers in this industry have low forward integration, which
corresponds to their degree of control on the distribution and sale of their products to companies like Burger King.
Based on this aspect of the Five Forces analysis, suppliers’ bargaining power is the least of Burger King’s concerns.

1.6.4 competitive Advantage :

Burger King’s success as one of the biggest fast food restaurant chains in the world is linked to its
effectiveness in applying its generic strategy for competitive advantage. Burger King’s intensive growth
strategies are also major contributors to the firm’s global growth. In this regard, the proper combination and
implementation of generic and intensive strategies can lead to significant competitive advantage and growth
in global business. Burger King’s generic strategy supports its competitive advantage based on cost, pricing,
and product features. On the other hand, increasing market share is the main thrust of Burger King’s intensive
growth strategies

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 2. Franchising
2.1 BURGER KING FRANSHISING OVER VIEW
The company known today as Burger King itself began as a franchise; the predecessor of the modern company was
founded in 1953 in Jacksonville, Florida, as Insta-Burger King. Burger King franchise is a great chain in the
inexpensive food industry, selling cheeseburgers, chicken, fries, onion rings, soda pops and treats. Past the standard
toll, Burger King additionally offers breakfast things, servings of mixed greens, combo suppers, and children’s
dinners, which can be obtained and appreciated available or utilizing a drive-through.

Being the second-largest hamburger chain in the US, Burger King franchise boasts 14,000 stores in 100 countries. It
specializes in burgers, salads, chicken, veggies, and desserts. Burger King restaurant franchise continues to provide
nice opportunities around the globe trying to enter new markets and expand in the countries where they have
gained popularity. Buying a Burger King franchise has a lot of pros. The main one is a good franchise cost and profit
balance. The second one is a guide from the franchisor on how to open a Burger King franchise with a detailed
investment information. And yet another one is a range of franchise formats for sale with reasonable franchise fees
and requirements.

2.2 TYPES OF BURGER KING FRANCHISES :

Franchising is a contractual agreement whereby a multinational marketer (the franchisor) grants the right to
another company (the franchisee) to do business in a specific place in a specific way for a period of time.
The franchisor currently has two different forms of franchise agreement, corresponding to three different types of
franchise ownership: Individual (or Owner/Operator) and Entity. The franchise granted can be operated at one of
three locations and facility types:

Page | 27
1. Institutional Locations: “Institutional locations” include government buildings and facilities, medical facilities,
airports, train and bus stations, sports facilities, factories, corporate campuses, turnpikes, limited access toll roads,
theme parks, zoos and educational facilities.
2. Traditional Burger King Restaurant Facility: A self-contained, full size Burger King Restaurant which is located and
operated on a site as a freestanding building or within another building structure such as a shopping mall. A
Traditional Burger King Restaurant does not share any common areas with any other businesses and serves the
standard approved menu for Burger King Restaurants.
3. Non-Traditional Burger King Facility: A Burger King Restaurant may be located at a site which includes other
businesses, such as retail, food service, gas stations, convenience stores, other franchised businesses or restaurants
or other similar facilities

PROS AND CONS OF OPENING A BURGER KING FRANCHISE

Opening a franchise can be a lower-risk way to start a small business, but it’s not for everyone. For one thing,
franchisees have to abide by company rules and the terms of their licensing agreements, so if you love to be
independent, opening a franchise might not be your best bet. Find out more about the pros and cons of franchising
below.

Pros

Pro 1: Franchises come with a ready-made business plan.

If you want to start a business but you don’t relish the process of crafting a business plan, choosing what to sell,
decorating your store and all the other minutiae involved in setting up an independent shop, buying a franchise
might be good option for you. Becoming a franchisee offers a lot of the benefits of starting a small business without
some of the start-up headaches.

Pro 2: Starting a franchise can make it easier to secure financing.

Some franchised businesses have their own financing arm, meaning that they provide loans for people who want to
buy and open as they provide loans for people who want to buy and open a franchise. Now, in-house franchise
financing might not always offer the lowest interest rates, and it’s always a good idea to comparison shop. But if
you think you might have a tough time getting a traditional small business loan from a bank, going the franchise
route can be a good work-around.

Pro 3: Franchises are less risky than independent businesses.

If you buy a franchise, you already know that the product is successful. It has brand recognition, for one thing.
Assuming the franchise is in a good location and the brand continues to attract customers you should have a pretty
solid business on your hands. If you want to be a small business owner but you don’t want to risk a lot of time and
capital on a venture that could fail, you might be drawn to franchising.

Pro 4: It’s easier to get advice about a franchise.

If you’re considering becoming a franchisee, you can talk to other people who have done the same or read about
their experiences online. You can get guidance and learn from the mistakes of others who have opened up branches

Page | 28
of the same franchise. Of course, if you open an independent small business you can get general advice, but you’ll
have access to more tailored tips with a franchise.

Cons

Con 1: Franchises can come with high start-up costs.

Starting a franchise might involve higher start-up costs than you would incur if you started an independent small
business. If you’re trying to start a small business without taking out a hefty loan or putting a lot of your own capital
on the line, becoming a franchisee might not be your best option. Before you commit to one form of business or the
other, it’s worth doing a cost comparison.

Con 2: You have less flexibility with a franchise.

When you become a franchisee you have to abide by the rules of the franchisor and keep to the terms of your
licensing agreement. You can’t shake up things like the products you carry, the decor of your store and the uniforms
the staff wear. With a franchise, you have less scope for innovation and for personalizing your business.

Con 3: Franchise fees can really add up.

Franchisors don’t let you take their logo and run with it. You’ll owe fees to the business from which you buy the
franchise. A portion of each month’s profits will leave your coffers and go to the franchisor, per your licensing
agreement. Those fees can add up, which is why it’s a good idea to enlist the services of a lawyer to help you get a
good deal on your franchise. If you’re fee-averse, you might decide to forgo a franchise altogether.

Con 4: The fate of your business isn’t entirely in your control.

Franchisees benefit from the brand recognition of the company whose franchise they buy, but they’re also
vulnerable if the public turns against that brand. Health scares at another franchise branch, corporate scandals and
more can all leave franchisees vulnerable and put their profits in jeopardy.

3. International marketing strategy:

It is evident that Burger King, in its pursue of expanding its global presence and increasing its profitability, uses
franchising as its entry Method into international markets. Burger King’s franchising strategy relies on the revenues
coming from the percentage of sales and the franchise fees paid being both paid by the franchisee. Additionally,
franchising secures income derived from the property that BK leases or subleases to the Franchisee. (Burger King –
Corporate Profile, 2014).

A few examples of Bugere King’s franchises are:

1) the establishment of three new restaurants in Maritnique (during 2014) by ADM food services to expand BK’s
brand presence in the French West Indies.

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 2) The opening of one restaurant in Brunei Darussalam by the brand's new franchisee, Sinofood Express in February
2014.
3) the opening of three BK restaurants in Sri Lanka by the franchisee, Softlogic Restaurants (Pvt) Ltd, which is a
subsidiary of Softlogic Holdings PLC.on December 28, 2013.

3.1 An Overview of the Global Strategy Burger King:

Burger King’s success as one of the biggest fast food restaurant chains in the world is linked to its effectiveness in
applying its generic strategy for competitive advantage. Burger King’s intensive growth strategies are also major
contributors to the firm’s global growth. In this regard, the proper combination and implementation of generic and
intensive strategies can lead to significant competitive advantage and growth in global business. Burger King’s
generic strategy supports its competitive advantage based on cost, pricing, and product features. On the other
hand, increasing market share is the main thrust of Burger King’s intensive growth strategies.

Burger King’s generic strategy represents the company’s current and potential competitive advantage. The intensive
growth strategies are indicative of Burger King’s approach to continue its global growth in the fast food/quick
service restaurant industry.

Burger King use a financial objective is to reduce operating costs so that its products can be offered at lower prices
through economies of scale and error prevention. Burger King uses cost leadership and broad differentiation
strategies to remain competitive.

3.2 International Marketing Coordination:

Burger King operates as a quick service restaurant business focusing on burgers as its main product. Burger King uses its
marketing mix (4Ps) as a response to the dynamic and saturated condition of the global quick service restaurant industry.
The marketing mix is a combination of strategies and tactics to effectively implement a marketing plan. In this case,
Burger King’s marketing mix aims to maximize competitiveness against a wide variety of players. This component of the
marketing mix presents organizational outputs offered to target customers. In addition, the company bundles its
products as value meals and kids meals. In this component of the marketing mix, Burger King has a limited approach, as
manifested in its limited product mix. Nonetheless, this product mix supports Burger King’s generic strategy through
economies of scale from large-scale production of a limited number of product lines. Burger King’s products are available
at its restaurants worldwide. This component of the marketing mix refers to the venue that firms use to transact with
target customers. Burger King uses market-oriented pricing strategy as its primary approach to pricing. This pricing
strategy involves setting prices based on prevailing market conditions, including supply and demand conditions as well as
the pricing of competing firms. Burger King’s secondary pricing approach is the bundle pricing strategy.

Revenue of Burger King worldwide 2004-2019

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 Published by S. Lock, Feb 24, 2020

Global fast food giant Burger King generated approximately 1.78 billion U.S. dollars in revenue in 2019. This shows
an eight percent increase over the previous year's total of 1.65 billion U.S. dollars.

4. Collaboration:
Opening a franchise can be a lower-risk way to start a small business, but it’s not for everyone. For one thing,
franchisees have to abide by company rules and the terms of their licensing agreements, so if you love to be
independent, opening a franchise might not be your best bet. Find out more about the pros and cons of franchising
below.

About Burger King Worldwide

Founded in 1954, the BURGER KING® brand is the second largest fast food hamburger chain in the world. The
original HOME OF THE WHOPPER®, the BURGER KING® system operates more than 14,000 locations in
approximately 100 countries and U.S. territories. Almost 100 percent of BURGER KING ® restaurants are owned and
operated by independent franchisees, many of them family-owned
operations that have been in business for decades. The BURGER
KING® brand is owned by Restaurant Brands International Inc.
(TSX,NYSE:QSR), one of the world’s largest quick service restaurant
companies with more than $23 billion in system sales and over 19,000
restaurants. To learn more about the BURGER KING® brand, please visit
the BURGER KING® brand website at www.bk.com or follow us
on Facebook, Twitter and Instagram.

Page | 31
 - GPS Collaboration with Pizza Hut
GPS Hospitality, a rapidly growing franchisee with more than 400 BURGER KING and Popeyes Louisiana
Kitchen restaurants in 11 states, made a growth acquisition of 75 Pizza Hut restaurants in Georgia, Alabama,
Kentucky and Tennessee, bringing the grand total of GPS’ footprint to 13 states. GPS Hospitality spent
months of reflection and research to identify its third brand, and the company is excited to solidify its
agreements to acquire its newest restaurants of Pizza Hut. The effects of this acquisition of the franchising
rights on Burger King was a major growth in the franchising as burger king expanded another 400 stores plus
gaining new locations from the other 3 companies including pizza hut for added growth for the company.
GPS also gave its companies the rights to use each other's drivers and delivery services through its virtual
website and virtual job fairs which lowered the expenses for Burger king.

- Collaboration with Indian "ever stone Group":

US chain Burger King is tying up with the Salman Khan-hosted reality show Bigg Boss on Colors channel to promote
its signature Whopper burgers. The Bigg Boss Whopper burger will be available in stores. Burger King has completed
a year in the country in a joint venture with Indian private equity firm Ever stone Group. According to Varman,
innovation on the menu has kept sales over the past year ticking

Which is a successful collaboration.

- Collaboration with McDonalds:

Burger King tried another collaboration with MCDonalds. Burger King made a proposal to collaborate
with McDonald’s on “The McWhopper”, which would be a hybrid of the equally iconic Big Mac and Whopper
burgers.
McDonald's has crushed the dreams of fast food addicts the world over by rejecting an offer by Burger King to join
forces to create a combination between the former's Big Mac and the latter's Whopper, dubbed the 'McWhopper'.
The burger was planned to consist of the Big Mac’s top bun, all-beef patty, cheese, lettuce, special sauce, and
middle bun, while adding the Whopper’s flame-grilled patty, along with tomato, onion, ketchup, pickles and its
bottom bun. The proposal was put forward in full-page ads in THE NEW YORK TIMES and THE CHICAGO
TRIBUNE, and a website was even made specifically for the campaign.
McDonald’s responded, disappointingly rebuffing any burger giant interbreeding. McDonald’s CEO Steve
Easterbrook took to Facebook to say that they loved the intention, but the “two brands could do something bigger
to make a difference”. For some added snark, Easterbrook mentioned that it was perhaps in poor taste to make a
vague comparison between “friendly business competition” and “the unequaled circumstances of the real pain and
suffering of war”, and that a simple phone call would do next time. Adding some hope to the story however, he said
he’d be in touch with Burger King; to do what, exactly, we’re unsure.

Which was obviously a bad collaboration .

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 - Burger King Collabs With 'Stranger Things' NETFLIX On "Upside Down" Whopper

With season three of Stranger Things less than a month away, collaborations surrounding the celebrated Netflix
program continue to roll in. Burger King shares news of a joint project with STRANGER THINGS, Netflix, and Coca-
Cola.
For one day only, Burger King is offering customers a STRANGER THINGS-themed Upside Down Whopper, of course
a nod to the show's parallel universe that is the Upside Down. The Upside Down Whopper comes with fries and a
drink, all for just $5.
The special menu item available solely at select locations in New York, California, Florida, Texas, and Illinois, among
other states.
Which is a successful collaboration.

Page | 33
REFERENCES

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07054/ufoc/
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https://www.astrogrowth.com/blog/pizza-hut/, https://www.comparably.com/companies/pizza-
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- Pizza Hut partners up for growth at home and abroad :
https://www.foodbusinessnews.net/articles/12308-pizza-hut-partners-up-for-growth-at-home-and-
abroad
- Top 100 Franchises 2020 : https://www.franchisedirect.com/top100globalfranchises/rankings
- Reasons Why A Burger King Franchise Can Be Profitable Than McDonald’s In India :
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in-india/
- Allied market research website, 2019, “ Artificial Marble Market - Global Opportunity Analysis and
Industry Forecast”, 2019-2026, retrieved at December 2019 from :
https://www.alliedmarketresearch.com/artificial-marble-market
- Burger King Franchise Costs & Fees : https://www.franchisedirect.com/foodfranchises/burger-king-franchise-07118/ufoc/
- King burger home : https://www.bk.com/about-bk
- Burger King’s Vision Statement & Mission Statement : http://panmore.com/burger-king-vision-statement-mission-
statement
- Burger King PESTEL/PESTLE Analysis & Recommendations : http://panmore.com/burger-king-pestel-pestle-analysis-
recommendations
- Strategic Management Audit: Burger King : https://www.slideshare.net/mobile/RamyMehelba/strategic-management-
audit-burger-king
- The Pros and Cons of Franchising : https://smartasset.com/career/the-pros-and-cons-of-franchising
- Revenue of Burger King worldwide 2004-2019 : https://www.statista.com/statistics/266462/burger-king-
revenue/#statisticContainer
-

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