Kfc In China Case Study

1863 Words 8 Pages
McDonald’s famous golden arches and Yum! Brand’s Kentucky Fried Chicken (KFC) are among the most iconic fast food establishments in the United States of America, but had mainly stayed in the home country. By the 1950’s both chains had a very strong presence in the United States and had began to invest abroad. After a lackluster attempt in Japan, KFC set its sights on China. China was and continues to be the one of the fastest growing economies on the planet. This is extremely enticing to companies operating in mostly saturated economies like Canada, Europe and the United States. China offered a virtually untouched economy with over a billion consumers and almost non existent competition leading to a boom in foreign investment. The Chinese …show more content…
The country had begun to “open up” only nine years before, and the Chinese people were very curious about life in the west. Natural curiosity about this western establishment helped KFC, and others that would enter the market. The Chinese people prefer chicken over beef giving KFC a natural advantage over other restaurants like McDonalds that specialize in hamburgers. In 1987 KFC had virtually no competition in the fast food industry. And even with McDonalds entering in the country three years later, they were in a completely different part of the country and not an immediate threat. KFC began operations with a differentiation strategy in China. While KFC’s style of fast food was nearly the same as other fast food places in the west, what they offered in China was completely different from that countries existing …show more content…
This was especially true for their employees. All positions from assistant manger on down were held by native Chinese people with a high school education, no restaurant experience and some English skills. KFC wanted these stores to be successful and an educated staff is essential in order to achieve success. With no previous restaurant experience the employees could be molded into the KFC style much easier. In the early days, many people eating at the locations were tourists and especially English speaking people. These new employees were highly compensated for their work and paid better then college professors in many cases. They also wanted executives with great knowledge of the area. They realized how important it was for their leaders to understand and relate with the Chinese people and give them what wanted rather than what the American stores offered. Within four years of opening the first restaurant, KFC’s largest store, it became the best selling KFC establishment in the entire

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