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KFC Vs Mac Donald
KFC Vs Mac Donald
INTRODUCTION OF KFC
Kentucky Fried Chicken is one of the largest fast food Franchise concepts of today; it is present in various countries around the world and it has been able to establish a renowned International reputation in multiple continents. Starting in the United States in the 1930s, it has grown to become a true multi-domestic company. KFC has focused on foreign markets since the 1960s and has found a new challenge today in conquering Asia.
HISTORY
The Kentucky Fried Chicken was founded by Colonel Harland Sanders (born on September 9, 1890) at the age of sixty-five. KFC is currently one of the largest businesses of the global food service industry and is widely known around the world as the face of Colonel Sanders.
Every year, over a billion KFC chicken dinners are served featuring the Colonels finger licking good special recipe. The Colonel had spread his industry to more than 80 countries and territories globally.
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.
Current Market value of the Yum Brands on the NYSE is 9.7 Billion $.
SWOT ANALYSIS
STRENGTHS
KFC continued to dominate the Chicken Segment, with sales of 4.4 billion in 1999. Despite gain by Boston Market and Chick-fill A, KFC customer base remained loyal to the KFC brand because of its unique taste. KFC has continued to dominate the dinner and take out segment of the Industry. Strong trademarks recipes. Ranks highest among all chicken restaurant chains for its convenience and menu variety. Generate $1B each year
MARKET SHARE
WEAKNESSES
KFC was loosing market share as other Chicken chain increased sales at a faster rate. KFC share of Chicken Segment sales fell from 71 percent 1989, to less than 56 percent in 1999, a 10-years drop of 15 percent. KFC leadership in U.S market was so extensive that it had fewer opportunities to expand its U.S restaurant base, which was only growing at about 1 percent per year. Failed to rank in top 20 in growth in 2000. Lack of knowledge about their customers. Question of over franchising leads to loss of control and quality. Lack of focus on R&D.
OPPORTUNITIES
McDonalds accounted for 35 percent of the Sandwich Segment while Burger King ran a distant Second, with a 16 percent market share. Per store sale at Burger King remained flat and Hardees per store sale declined by 10 percent. In family Segment, Friends and Shoneys were forced to shut down restaurants because of declining profits. Within the Pizza Segment, Pizza Hat and Little Caesars Closed underperforming restaurants. Boston Market was a new restaurant chain that emphasized roasted rather than fried chicken. In 1999, Boston Market soon entered Bankruptcy proceedings. Churchs broadened its menu to include buffalo chicken wings, macaroni and cheese, beans and rice and collard greens. Baby boomers aged 35 to 50 constituted the largest customer group for fast-food restaurants.
THREATS
McDonalds with sales of more than 19 billion in 1999, accounted for 15 percent of the sales of the nations top 100 restaurant chains. McDonalds generated per store sale 1.5 million per year. Much of the growth in dinner houses came from new unit construction in suburban market and small town. In Family Segment, Steak n Shake and Cracker Barrel expend its restaurant by more than 10 percent. KFC nearest competitor Popeye, ran a distant second with sales of 1.0 billion. In early 1990s many industry analysts predict that Boston Market would challenge KFC for market leadership. Boston market and Chick-fil-A market share gains were achieved primarily by taking customer away from KFC. Popeyes replaced Boston market as the second largest chicken chain in 1999.
RECOMMENDATIONS
If KFC could increase company own restaurants, which enables it to control quality, services and restaurant cleanliness. Therefore more capital is needed. On the other hand if company operated franchise based restaurants throughout Latin America, its brand image could be build and its competitors will be loosing first more advantage. Latin American markets is developing markets, so its growth is high and entry barriers are low. KFC could make strategic alliances with key suppliers to gain advantage over competitors in the market. An a peeling business model and good strategy has golden opportunity to shape the rules and establish itself as the recognize market leader.
CONCLUSION
FOCUS OF THEIR STRATEGY SHOULD BE ON THE COUNTRIES LIKE CHINA, AND INDIA ETC BECAUSE THEY PROVIDE MARKETS WHICH HAVE HIGH GROWTH RATE ON THE OTHER HAND..