MINOR PROJECT REPORT

On
Kentucky Fried Chicken

Submitted in partial fulfillment of the requirement of

Bachelors of Business Administration (BBA)
Guru Gobind Singh Indraprastha University,
Delhi

Faculty Guide Submitted By: GUDDU CHAWLA

Name: Mrs. Manisha Gupta
Name of student: GUDDU CHAWLA
Designation University Enrollment No.

SESSION 2014 2015

Sector-16C, Dwarka,
New Delhi 110075
Guru Gobind Singh Indraprastha University

KFC (Kentucky Fried Chicken)

.
KFC

Type
Industry
Genre

Founded

KFC's logo since 2006

Subsidiary
Restaurant
Fast food
Sanders Court & Cafe:
1930 in North Corbin,
Kentucky
First franchise: 1952 in Salt
Lake City, Utah

Harland Sanders
1441 Gardiner Lane, Louisville,
Headquarters Kentucky, United States
(Operational Headquarters)[1]
Number of
18,875 (2013)[2]
locations
David C. Novak (Yum!
Brands Chairman and
CEO)[3]
Roger Eaton (Yum! COO
Key people
and KFC President)[3]
[3]
Muktesh Pant (KFC CEO)
Founders

Products
Revenue

Fried chicken, chicken burgers,

wraps, French fries, soft drinks,
salads, desserts, breakfast
US$23 billion (2013)[4]
2

Parent

Website

Yum! Brands
www.kfc.com
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KFC (the name was originally an initialism for Kentucky Fried Chicken) is a fast food
restaurant chain that specializes in fried chicken and is headquartered in Louisville, Kentucky, in
the United States. It is the world's second largest restaurant chain (as measured by sales) after
McDonald's, with 18,875 outlets in 118 countries and territories as of December 2013. The
company is a subsidiary of Yum! Brands, a restaurant company that also owns the Pizza Hut and
Taco Bell chains.
KFC was founded by Harland Sanders, an entrepreneur who began selling fried chicken from his
roadside restaurant in Corbin, Kentucky, during the Great Depression. Sanders identified the
potential of the restaurant franchising concept, and the first "Kentucky Fried Chicken" franchise
opened in Utah in 1952. KFC popularized chicken in the fast food industry, diversifying the
market by challenging the established dominance of the hamburger. By branding himself as
"Colonel Sanders," Harland became a prominent figure of American cultural history, and his
image remains widely used in KFC advertising. However, the company's rapid expansion saw it
overwhelm the ageing Sanders, and in 1964 he sold the company to a group of investors led by
John Y. Brown, Jr. and Jack C. Massey.
KFC was one of the first fast food chains to expand internationally, opening outlets in the United
Kingdom, Mexico, and Jamaica by the mid-1960s. Throughout the 1970s and 1980s, KFC
experienced mixed fortunes domestically, as it went through a series of changes in corporate
ownership with little or no experience in the restaurant business. In the early 1970s, KFC was
sold to the spirits distributor Heublein, who were taken over by the R.J. Reynolds food and
tobacco conglomerate, who sold the chain to PepsiCo. The chain continued to expand overseas
however, and in 1987 KFC became the first Western restaurant chain to open in China. The
chain has since expanded rapidly in China, which is now the company's single largest market.
PepsiCo spun off its restaurants division as Tricon Global Restaurants, which later changed its
name to Yum! Brands.
KFC's original product is pressure fried chicken pieces, seasoned with Sanders' recipe of 11
herbs and spices. The constituents of the recipe represent a notable trade secret. Larger portions
of fried chicken are served in a cardboard "bucket," which has become a well known feature of
the chain since it was first introduced by franchisee Pete Harman in 1957. Since the early 1990s,
KFC has expanded its menu to offer other chicken products such as chicken fillet burgers and
wraps, as well as salads and side dishes, such as French fries and coleslaw, desserts, and soft
drinks, the latter often supplied by PepsiCo. KFC is known for the slogan "finger lickin' good,"
which has since been replaced by "Nobody does chicken like KFC" and "So good."
3

History

The Harland Sanders Caf and Museum

Harland Sanders was born in 1890 and raised on a farm outside Henryville, Indiana.[5] When
Harland was five years old, his father died, forcing his mother to work at a canning plant.[6] This
left Harland, as the eldest son, to care for his two younger siblings.[6] After he reached seven
years of age, his mother taught him how to cook.[5] After leaving the family home at the age of
13, Sanders passed through several professions, with mixed success.[7] In 1930, he took over a
Shell filling station on US Route 25 just outside North Corbin, Kentucky, a small town on the
edge of the Appalachian Mountains.[8] It was here that he first served to travelers the recipes that
he had learned as a child: fried chicken and other dishes such as steaks and country ham.[8] After
four years of serving from his own dining room table, Sanders purchased the larger filling station
on the other side of the road and expanded to six tables.[9] By 1936, this had proven successful
enough for Sanders to be given the honorary title of Kentucky colonel by Governor Ruby
Laffoon.[10] In 1937 he expanded his restaurant to 142 seats, and added a motel he purchased
across the street, naming it Sanders Court & Caf.[11]
Sanders was unhappy with the 35 minutes it took to prepare his chicken in an iron frying pan, but
he refused to deep fry the chicken, which he believed lowered the quality of the product.[12] If he
pre-cooked the chicken in advance of orders, there was sometimes wastage at day's end.[5] In
1939, the first commercial pressure cookers were released onto the market, mostly designed for
steaming vegetables.[13] Sanders bought one, and modified it into a pressure fryer, which he then
used to fry chicken.[14] The new method reduced production time to be comparable with deep
frying, while, in the opinion of Sanders, retaining the quality of pan-fried chicken.[12]
In July 1940, Sanders finalised what came to be known as his "Original Recipe" of 11 herbs and
spices.[15] Although he never publicly revealed the recipe, he admitted to the use of salt and
pepper, and claimed that the ingredients "stand on everybody's shelf."[16] After being
recommissioned as a Kentucky colonel in 1950 by Governor Lawrence Wetherby, Sanders began
to dress the part, growing a goatee and wearing a black frock coat (later switched to a white suit),
a string tie, and referring to himself as "Colonel."[16] His associates went along with the title
change, "jokingly at first and then in earnest," according to biographer Josh Ozersky.[17]
4

Harland Sanders in character as "The Colonel"

The Sanders Court & Caf generally served travelers, so when the route planned in 1955 for
Interstate 75 bypassed Corbin, Sanders sold his properties and traveled the US to franchise his
chicken recipe to restaurant owners.[18] Independent restaurants would pay four (later five) cents
on each chicken as a franchise fee, in exchange for Sanders' "secret blend of herbs and spices"
and the right to feature his recipe on their menus and use his name and likeness for promotional
purposes.[19] In 1952 he had already successfully franchised his recipe to his friend Pete Harman
of South Salt Lake, Utah, the operator of one of the city's largest restaurants.[20]
Don Anderson, a sign painter hired by Harman, coined the name "Kentucky Fried Chicken."[21]
For Harman, the addition of KFC was a way of differentiating his restaurant from competitors; a
product from Kentucky was exotic, and evoked imagery of Southern hospitality.[21] Harman
trademarked the phrase "its finger lickin' good," which eventually become the company-wide
slogan.[19] He also introduced the "bucket meal" in 1957 (14 pieces of chicken, five bread rolls
and a pint of gravy in a cardboard bucket).[22] Serving their signature meal in a paper bucket was
to become an iconic feature of the company.[22]
By 1963 there were 600 KFC restaurants, making the company the largest fast food operation in
the United States.[18] KFC popularized chicken in the fast food industry, diversifying the market
by challenging the established dominance of the hamburger.[23]
In 1964, Sanders sold the company to a group of investors led by John Y. Brown Jr. and Jack C.
Massey for US$2 million (around US$15 million in 2013).[10] The contract included a lifetime
salary for Sanders and the agreement that he would be the company's quality controller and
trademark.[24] The chain had reached 3,000 outlets in 48 different countries by 1970.[25] In July
1971, Brown sold the company to the Connecticut-based Heublein, a packaged food and drinks
corporation, for US$285 million (around US$1.6 billion in 2013).[26] Sanders died in 1980, his
5

promotional work making him a prominent figure in American cultural history.[23] By the time of
his death, there were an estimated 6,000 KFC outlets in 48 different countries worldwide, with
$2 billion of sales annually.[27]
In 1982, Heublein was acquired by R. J. Reynolds, the tobacco giant.[22] In July 1986, Reynolds
sold KFC to PepsiCo for $850 million (around US$1.8 billion in 2013).[28] PepsiCo made the
chain a part of its restaurants division alongside Pizza Hut and Taco Bell.[29] The Chinese market
was entered in November 1987, with an outlet in Beijing.[22]
In 1991, the KFC name was officially adopted, although it was already widely known by that
initialism.[30] Kyle Craig, president of KFC US, admitted the change was an attempt to distance
the chain from the unhealthy connotations of "fried".[31] The early 1990s saw a number of
successful major products launched throughout the chain, including spicy "Hot Wings"
(launched in 1990), popcorn chicken (1992), and internationally, the "Zinger", a spicy chicken
fillet burger (1993).[32] By 1994, KFC had 5,149 outlets in the US, and 9,407 overall, with over
100,000 employees.[33] In August 1997, PepsiCo spun off its restaurants division as a public
company valued at US$4.5 billion (around US$6.5 billion in 2013).[34] The new company was
named Tricon Global Restaurants, and at the time had 30,000 outlets and annual sales of US$10
billion (around US$14 billion in 2013), making it second in the world only to McDonald's.[35]
Tricon was renamed Yum! Brands in May 2002.[36] Brief History of KFC
How it all began!

Harland David Sanders was born September 9, 1890 in Indiana, USA. The young Harland
Sanders had many jobs such as a farmhand, a bus conductor, a steam boat driver, a soldier, and a
salesman. Eventually he became a business man owning a petrol service station in Kentucky, one
of the 52 states of the USA.
Many travelers stopped at his service station wanting refreshments and food. The Colonel saw
this as a business opportunity and decided to offer food to these customers. The Colonel enjoyed
6

making his customers happy he was passionate about entertaining them with excellent food and
superb service.
His food and service was so good that he was mentioned in several newspapers around the
country. As a result he had to expand his dining room to keep up with the increase in new
customers. This 'Customer Mania' experience made people drive from far away just to visit the
Colonel's restaurant.
A winning recipe!

After careful testing for many years to find just the right combination of ingredients, the Colonel
knew that he was at last onto a winning recipe. When he added the 11th and final ingredient, he
was truly satisfied that he had created the best chicken he had ever tasted he wanted to share it
with the world!
To this day, the Original Recipe of 11 Herbs and Spices is one of the biggest secrets in the world
- the Finger Lickin' Taste of KFC! The Colonel also introduced the idea of using a pressure
cooker to cook the chicken. This ensured that the product cooked faster and produced the best
results ever.
The Colonel decided that his Original Recipe needed to be introduced to people further from his
home and from his state. At the age of 66, he started selling his idea of Kentucky Fried Chicken
by traveling from town to town, preparing his famous chicken recipe for restaurants and their
employees. Soon everybody wanted to try it families stood in queues to try his great Original
Recipe.
Colonel Sanders appeared on national Television promoting the idea of Kentucky Fried Chicken.
He always licked his fingers as he described the Original Recipe taste to viewers this is how
the slogan It's Finger Lickin' Good developed.

Operations

A stand-alone KFC drive-through unit located in Australia

Map of countries with KFC franchises

KFC is a subsidiary of Yum! Brands, one of the largest restaurant companies in the world. KFC
had sales of $23 billion in 2013.[4] KFC has its headquarters at 1441 Gardiner Lane, Louisville,
Kentucky, in a three-story colonial style building known colloquially as the "White House" due
to its resemblance to the US president's home.[37][38] The headquarters contain executive offices
and the company's research and development facilities.[39] KFC is incorporated at 1209 North
Orange St, Wilmington, Delaware.[40]
By December 2013, there were 18,875 KFC outlets in 118 countries and territories around the
world.[2][41] There are 4,563 outlets in China, 4,491 in the United States, and 9,821 across the rest
of the world.[2] Outlets are owned by franchisees or directly by the company.[42] Eleven percent

of outlets are company owned, with the rest operated by franchise holders.[43] Although capital
intensive, company ownership allows for faster expansion of the chain.[44]
Most restaurants are furnished with images of the company founder, Colonel Harland Sanders.[39]
As well as dine-in and take-out, many stand-alone KFC outlets offer a drive-through option.[45]
KFC offers a limited delivery service in a small number of markets.[45] Units include express
concessions and kiosks which feature a limited menu and operated in non-traditional locations
such as filling stations, convenience stores, stadia, theme parks and colleges, where a full scale
outlet would not be practical.[45] Average annual sales per unit was $1.2 million in 2013.[46]
Worldwide, the daily average number of food orders at an outlet is 250, with most occurring
within a two hour peak-period.[47]
As chairman and CEO of Yum!, David C. Novak ultimately has foremost responsibility for KFC
operations.[3] Sam Su is chairman and CEO of Yum!'s Chinese operations, and Muktesh Pant is
the CEO of KFC.[3] Richard T. Carucci is president of Yum!, and Roger Eaton is the COO of
Yum! And the president of KFC.[3]
China
KFC is the largest restaurant chain in China, with 4,563 outlets.[2] KFC became the first Western
fast food company in China after its first outlet opened in Qianmen, Beijing, in November
1987.[48]
Local food items include rice congee and tree fungus salad, with an average of 50 different menu
items per store.[48][49]
In December 2012, the chain faced allegations that some of its suppliers injected antiviral drugs
and growth hormones into poultry in ways that violated food safety regulations.[50] This resulted
in the chain severing its relationship with 100 suppliers, and agreeing to "actively co-operate"
with a government investigation into its use of antibiotics.[48] KFC China sales in January 2013
were down 41 percent against the previous year.[51] To counter sluggish sales, the menu was
revamped in 2014.[52]
In July 2014, Chinese authorities closed down the Shanghai operations of the OSI Group, amidst
allegations that it had supplied KFC with expired meat.[53] Yum! immediately terminated its
contract with the supplier, and stated that the revelation had led to a "significant [and] negative"
decline in sales.[54]

United States

A co-branded KFC-Taco Bell in Oscoda, Michigan

KFC sales in the United States in 2013 were estimated at $4.22 billion by Technomic.[55]
The basic model for KFC in the United States, not necessarily duplicated elsewhere, is a focus on
low prices, a limited menu (29 items on average) and an emphasis on takeout.[43] A "very strong
percentage" of sales come from African American customers.[56] Many KFC locations are colocated with either Taco Bell or Pizza Hut, or other Yum! Restaurants.[45] When Yum! Owned
Long John Silver's and A&W Restaurants, these brands were often co-branded with KFC as
well.[57] Often these locations behave like a single restaurant, offering one menu with food items
from both restaurant brands.[58] In 2003, there were 354 KFC-Taco Bell combines, offering the
full KFC menu and Taco Bell items, and 13 units offering the full KFC menu and a limited
number of Pizza Hut items.[45] The concept originated in 1991, when a KFC-Taco Bell
combination opened in Virginia.[22] Some locations were also opened as combinations of KFC,
Taco Bell and Pizza Hut, but this failed to catch on, and Yum! CEO David Novak blamed a lack
of franchisee commitment for its lack of success.[59]
Initially, Sanders and KFC used hydrogenated vegetable oil for frying, but in the 1980s the
company began to switch to cheaper oils such as palm or soybean.[60][61] In the 2000s it became
apparent that these oils contain relatively high levels of trans fat, which increases the risk of
heart disease. By April 2007, the chain had switched to trans fat-free soybean oil in all of its US
outlets.[62]
In 2008, Novak credited low US sales as being the result of a lack of new ideas and menu
items.[63] The Spring 2009 launch of Kentucky Grilled Chicken only resulted in a temporary halt
to the sales decline.[64] In 2010 KFC announced a turnaround plan that included improving
restaurant operations, introducing value items and providing healthier menu options.[64] In the
same year, Advertising Age noted that KFC was losing market share to its smaller chicken
10

restaurant rival, Chick-fil-A.[65] In 2011 Bloomberg News referred to KFC US as "an also-ran to
McDonald's Corp."[66] In 2012, Forbes magazine described how many of the KFC outlets were
"aged and uninviting," and that the chain "hasn't introduced an exciting new food item in
ages."[67]
KFC was described in 2012 by Bloomberg Business week as a "muscular player" in developing
regions, specifically Africa, China and India, while noting its falling market share in the US to
rivals such as Chick-fil-A and Popeyes.[68] Some analysts speculated that KFC would begin
spinning off its ailing US operations.[68] That year, the company began divesting control of
company-owned US restaurants to franchised operations, with the intention of reducing overall
company ownership from 35 percent to 5 percent.[68]
Japan
Japan is the third-largest market for KFC after China and the United States with 1,200 outlets.[69]
In Japan, 70 percent of sales are takeout, with customers tending to buy fried chicken for parties
and other special occasions and eating it as a side dish.[70]
KFC Japan was originally formed as a joint venture between the American parent and the
Japanese Mitsubishi Corporation.[71] After four years of negotiations, Mitsubishi was awarded
the franchise rights to KFC in Japan, and a test store was opened at the Osaka World Expo in
March 1970.[71] After the dbut proved to be a success, the first store proper was opened in the
suburban location of Nagoya in November 1970.[72] The American parent wanted suburban
locations, whereas Mitsubishi had argued for city centre locations, as the car had not been widely
adopted in Japan at that time.[72] Two more locations were opened in Osaka, but the stores
struggled, and after less than a year operations had lost JP 100 million.[72] As a result of this
failure, Mitsubishi's original plan for urban locations was pursued.[72]
The first new strategy store opened in Kobe in 1972, an up market residential area with a large
Western expatriate community.[72] The new strategy was a success, and by December 1973, 100
outlets had been opened.[72] In December 1974, KFC Japan began to promote fried chicken as a
Christmas meal.[72] Eating KFC as a Christmas time meal has since become a widely practiced
custom in Japan.[73] Harland Sanders himself visited the Japanese operations in 1972, 1978 and
1980.[74]
In August 1990, KFC Japan was listed on the Tokyo Stock Exchange.[75] KFC had benefited
from the economic boom in Japan during the 1980s, but a rapid expansion of outlets saw
franchisees taking market share from each other, and around 100 outlets were closed down in the
mid-1990s.[76] In 2000, KFC Japan reported sales of nearly $598 million.[77] In December 2007,
Mitsubishi assumed majority control of KFC Japan in a JP 14.83 billion transaction.[78]

11

United Kingdom

A KFC in Belfast, Northern Ireland

As of December 2013, there were 784 KFC outlets in the United Kingdom.[2] About 70 percent
of outlets are run by franchisees, with the remainder company owned.[79] The company employs
24,000 people.[79] Around 400 sites are drive-through outlets.[79] Average outlet turnover is
between 1 and 1.5 million.[79]
Annual sales amount to 60,000 metric tonnes of chicken, 60 percent of which is purchased from
the four largest suppliers in the UK, including Faccenda Group[80] and 2 Sisters Food
Group,[81][82] and delivered fresh to outlets at least three times a week.[83] The remaining 40
percent is sourced from companies in Europe, Thailand (including Charoen Pokphand Foods)
and Brazil.[84] All of the Original Recipe chicken is sourced within the UK.[84]
England had the first overseas branch of KFC which opened in Preston in the North West in May
1965, and was the first American fast food restaurant chain in the country, pre-dating the arrival
of McDonald's, Burger King and Pizza Hut by almost a decade.[85] The first London branch
opened in North Finchley in November 1968.[86] In 1971 there were 31 outlets; by 1975 the chain
had grown to 250 outlets.[87] In the late 1970s and throughout the 1980s, KFCs began to
introduce seating. KFC opened its first drive through restaurant in the UK in 1984.[88] By 1987
the company had almost 400 outlets.[89]
In 2006, the company stopped pre-salting its fries and removed transfats from its products.[79] In
2012 palm oil was replaced by rapeseed oil in the fryers.[79] Between 2004 and 2014, KFC UK
increased its offering of "portable" foods: burgers, wraps and salads.[79] During that period, sales
rose from around 500 million to almost 1 billion.[79] In 2012, KFC UK invested 9 million to
install ovens in all of its outlets, so that it could offer griddled chicken.[79] In 2013, KFC rolled
12

out Lavazza coffee across all of its UK outlets.[90] As of 2014, KFC UK is trialling serving only
halal meat at 96 of its outlets.[91]
Australia and New Zealand

A KFC outlet in Derwent Park, a northern suburb of Hobart, Australia.

There are over 600 KFC outlets in Australia, and around 100 in New Zealand.[69] KFC was the
first American style fast food chain to open in both countries.[92] In 2013, KFC reported an
annual turnover of almost A$2 billion for its Australia and New Zealand operations.[93]
Yum! Directly operates 160 KFC outlets in Australia.[93] The largest of the 53 independent
franchisees in Australia is Collins Foods, which operates 169 stores. KFC's major poultry
suppliers in Australia are Inghams, Steggles and Turi Foods.[93]
The first Australian KFC was opened in 1968 in Guildford, a suburb of Sydney.[95] The franchise
was owned by a Canadian entrepreneur called Bob Lapointe.[96] Between 1970 and 1971, 75
outlets were opened.[96] This had a major impact on Australian chicken production, which
increased by 38 percent during the period.[96] By 1995 there were 452 outlets, and the company
employed 12,000 staff.[95] That year, Australia produced 35 percent of KFC's international
earnings.[95]
The first KFC opened in New Zealand in 1971 at Royal Oak, a suburb of Auckland.[97] By 1980
there were 37 outlets.[92] In 1989, PepsiCo acquired the 50 percent stake in KFC New Zealand
that it did not already own from the local Goodman Fielder conglomerate.[97] In 1991 New
Zealand turnover topped NZ$100 million for the first time.[97]

13

India

KFC outlet on Middleton Row in Kolkata.

In December 2013, there were 361 KFC outlets in India.[2] As well as the standard KFC
offerings, the chain sells a chickpea burger, a paneer burger, hot wings with chilli lemon
sprinkles and other country-specific products.[98][99] A major franchise holder is QSR Brands (M)
Holdings, which operated 26 outlets as of 2012.[100]
The first Indian KFC was a two-storey outlet on the fashionable Brigade Road in Bangalore in
June 1995.[101] According to journalist Michael White, the company could not have chosen a
"more difficult venue for its maiden entre into the country."[102] Bangalore housed the
headquarters of the Karnataka Rajya Raitha Sangha, one of the most influential, vocal and antiforeign investment farmers' associations in the country.[102] The first outlet suffered protests from
left wing, anti-globalization and environmental campaigners, as well as local farmers, who
objected to the chain bypassing local producers.[103] Many Indians were concerned about the
onslaught of consumerism, the loss of national self-sufficiency, and the disruption of indigenous
traditions.[104] The protests came to a head in August 1995, when the Bangalore outlet was
repeatedly ransacked.[101] The KFC outlet in Bangalore demanded, and received, a police van
permanently parked outside for a year The outlet was closed on September 13, 1995 by local
authorities, who claimed the company used illegally high amounts of monosodium glutamate
(MSG) in its food.[105] However, the outlet reopened for business within six hours of its closure,
after the Karnataka High Court blocked the local authorities' order on an appeal by KFC. The
company had argued that it prepared food in India using the same formula as in 77 other
countries.[106] Rural activist M. D. Nanjundaswamy subsequently claimed KFC would adversely
affect the health of the impoverished, by diverting grain from poor people to make the more
profitable animal feed.[107] Former environment minister Maneka Gandhi joined the anti-KFC
movement.[107] A second outlet opened in Delhi, but was closed by the authorities throughout
November, purportedly for health reasons, but more likely to avoid a repetition of the Bangalore
incident.[108] The Delhi outlet soon closed permanently.[109]
14

KFC began to expand outside of Bangalore in 2004,[110] with a localized menu that was the most
extensive meat-free menu across the chain's worldwide operations. It introduced a vegetarian
menu that included rice meals, wraps and side dishes and, like McDonald's, served eggless
mayonnaise and sauces. Unnat Varma, marketing director of KFC India, states "The vegetarian
offerings have made the brand more relevant to a larger section of consumers and that is
necessary for KFC's growth." KFC also began using Indian spices and cooking techniques to
localize its chicken dishes. By 200809, KFC operated 34 outlets in India.[111] in 2014, KFC
launched the "So Veg, So Good" menu as part of an India-specific promotional strategy focused
on enhancing their vegetarian range. Dhruv Kaul, marketing director of KFC India, stated, "The
So Veg, So Good menu launch does not mean that we are moving away from our core chicken
offerings. It enhances and strengthens our existing vegetarian range and helps broaden the
brand's relevance in a diverse country such as India."[99]
Indonesia

A counter at a KFC in Bandung, Indonesia

In Indonesia KFC is the largest Western restaurant chain, with 466 outlets as of December
2013.[2][112] The chain has grown to hold an estimated 32 percent market share, and menu items
include spaghetti, wraps and chicken porridge.[113] The master franchisee is PT Fast-food
Indonesia.[114]
The first outlet opened in Jakarta in 1979.[114] Salim Group, Indonesia's largest conglomerate,
became a major shareholder in 1990, which provided the company with funds for major
expansion.[114] Its master franchisee, PT Fast food Indonesia, was publicly listed on the
Indonesian Stock Exchange in 1993.[114]

15

Developing markets
KFC continues to grow in Asia. In Malaysia there were 579 outlets as of December 2013.[115]
KFC first entered the Middle East and North Africa (MENA) market in the early 1970s. There
are over 500 outlets in the MENA region.[47] It purchases most of its poultry from Sadia of
Brazil.[47]
In 2012, KFC operated 577 restaurants across 36 countries in the Caribbean and Latin America
region.[116]
The company hopes to expand its African operations, where it is already the regional leader
among US fast food chains.[117][118] The company is slowly expanding across the African
continent, opening 70 outlets, but progress has been hampered by sourcing issues, such as a lack
of quality suppliers.[44]

Products

16

A Vietnam KFC shrimp burger in 2007

KFC's core product offering is pressure fried on-the-bone chicken pieces seasoned with the
"Original Recipe". The product is typically available in either two or three piece individual
servings, or in a family size cardboard bucket, typically holding between 6 and 16 chicken
pieces. Poultry is divided into 9 different cuts (2 drumsticks, 2 thighs, 2 wings, 1 keel, and a
backbone based breast cut divided into 2 pieces.[119] The product is hand-breaded at individual
KFC outlets with wheat flour mixed with seasoning in a two to four minute process.[47][93] It is
then pressure fried for a maximum of seven minutes at 185 degrees celsius.[47][120] Following this,
the chicken is left to stand for 5 minutes in order for it to sufficiently cool before it is placed in
the warming oven.[47] It is KFC policy to discard chicken if it has not been sold within 90
minutes, in order to ensure freshness.[47] The frying oil varies regionally, and versions used
include sunflower, soybean, rapeseed and palm oil.[44] A KFC executive stated that the taste of
the chicken will vary between regions depending on the oil variety used, and whether the chicken
has been corn-fed or wheat-fed.[44]
As well as its core chicken on the bone offering, KFC's major products include chicken burgers
(including the Zinger and the Tower burgers); wraps ("Twisters" and "Boxmasters"); and a
variety of finger foods, including crispy chicken strips and hot wings.[121][122] Popcorn Chicken is
one of the most widely available KFC products, and consists of small pieces of fried chicken.[123]
In some locations, chicken nuggets are sold, and are sometimes sold, as in Australia, under the
"Kentucky Nuggets" trademark.[124]
KFC adapts its menu internationally to suit regional tastes, and there are over three hundred KFC
menu items worldwide.[43] Some locations, such as the UK and the US, sell grilled
chicken.[125][126] In predominantly Islamic countries, the chicken served is halal.[47] In Asia there
is a preference for spicy foods, such as the Zinger chicken burger.[127] Some locations in the US
sell fried chicken livers and gizzards.[128] A small number of US outlets offer an all-you-can-eat
buffet option with a limited menu.[129]
A number of territories, such as Japan, Jamaica, Trinidad, Barbados, Ecuador and Singapore sell
fried seafood products under the "Colonel's Catch" banner.[130] In Jamaica, what was originally a
seasonal offering for the Lent period was expanded to a year-round offering from 2010.[131]

17

KFC Hot Wings fried chicken in Malaysia.

Value menu items are sold under the "Streetwise" name in locations such as Canada.[132] Side
dishes often include French fries, coleslaw, barbecue baked beans, corn on the cob, mashed
potato, bread rolls and American biscuits.[133] Salads include the bean salad, the Caesar salad and
the garden salad. In a number of territories, KFC sell onion rings.[134] In Asia, rice based side
dishes such as kanji are often sold.[44] In Malaysia, chicken meatball soup is sold. In the US and
Greece, potato wedges are sold instead of French fries.[135]
McCormick & Company is KFC's largest supplier of sauces, seasonings and marinades, and is a
long-term partner in new product development.[93]
Due to the company's previous relationship with PepsiCo, most territories supply PepsiCo
products, but exceptional territories include South Africa, the Philippines, Turkey, Romania,
Greece and Barbados, which stock drinks supplied by The Coca-Cola Company, and Aruba,
which stocks RC Cola from the Cott Corporation.[136][137][138] In Peru, the locally popular Inca
Kola is sold.[139] In a number of Eastern European locations and Portugal, beer is offered, in
addition to soft drinks.[140][141][142]
Launched in 2009, the Krusher/Krushem range of frozen beverages containing "real bits" such as
Kit Kat, Oreo and strawberry shortcake, is available in over 2,000 outlets.[143] Egg custard tart is
a popular dessert worldwide, but other items include ice cream sundaes and tres leches cake in
Peru.[144]
In 2012, the "KFC am" breakfast menu began to be rolled out internationally, including such
items as pancakes, waffles and porridge, as well as fried chicken.[145]

18

11 herbs and spices

Sanders' Original Recipe of "11 herbs and spices" is one of the most famous trade secrets in the
catering industry.[146] The recipe is not patented, because patents eventually expire, whereas trade
secrets can remain the intellectual property of their holders in perpetuity.[147]
A copy of the recipe, signed by Sanders, is held inside a safe inside a vault in KFC's Louisville
headquarters, along with eleven vials containing the herbs and spices.[68][148] To maintain the
secrecy of the recipe, half of it is produced by Griffith Laboratories before it is given to
McCormick, who add the second half.[149]
Equipment

KFC Original Recipe fried chicken

KFC initially used stove-top covered cooking pots to fry its chicken.[150] In the 1960s, the
officially recommended model was the L S Hertzog developed "KFC 20-Head Cooker," a large
device that cost $16,000.[151] The Hertzog model had no oil filtration system, meaning that
filtering had to be done manually, and the pressure fryers occasionally exploded.[150] In 1969, an
engineer called Winston Shelton developed the "Collectramatic 519" pressure fryer that would
self-filter the oil, and used precision timers and temperature controls.[150] Fred Jeffries, then vice
president of purchasing at KFC, claimed that the invention helped fuel the company's rapid
expansion and success: "There's no way it could have grown like it did without the
Collectramatic. Stores were doing about $200,000 a year in sales on average with the pots but
they could never have done the $900,000 a year it became without Win's fryer."[150]
Although a number of franchisees bought the Collectramatic, which had the support of Colonel
Sanders from 1970 onwards, John Y. Brown had already signed an exclusive contract to only use
the L S Hertzog fryer.[150] Brown warned franchisees that they were in violation of their contract
19

if they used the Collectramatic.[150] Brown held his ground on the issue until he learned that his
father, John Y. Brown, Sr., who was a KFC franchisee himself, was also using the
Collectramatic.[150] The issue was eventually resolved after Heublein purchased KFC and
acquired Hertzog in order to invalidate the contract.[151] The Collectramatic thus became the
official pressure fryer for KFC from 1972 onwards.[151]
Winston previously supplied KFC with holding cabinets, but since 2010, these have been
supplied by Henny Penny.[152]

Advertising
Colonel Sanders

A Colonel Sanders statue outside a KFC outlet in Japan. Such statues are common outside Asian KFCs.

Colonel Sanders was a key component of KFC advertising until his death in 1980. Despite his
death, Sanders remains a key symbol of the company; an "international symbol of
hospitality."[153]
Modern renditions of the Colonel are sometimes used in post-1980 advertising. In 1994,
Henderson Forsythe portrayed the Colonel in a television campaign entitled "The Colonel's
Way."[154] from 1998 to 2001 an animated version of the Colonel voiced by Randy Quaid was
used for television advertisements.[155][156] In 2012, a UK advertisement entitled "4000 cooks"
featured an actor made up to resemble Sanders.[157]
The ubiquity of Sanders has not prevented KFC from introducing a mascot aimed at children.
"Chicky," a young animated chicken, was first introduced in Thailand in the 1990s, and has since
20

been rolled out across a number of markets worldwide, mostly in Asia and South
America.[158][159]
Slogans
Early official slogans included "North America's Hospitality Dish" (from 1956) and "We fix
Sunday dinner seven nights a week" from 1957 until 1967.[160][161]
The "finger lickin' good" slogan was used from 1956, and went on to become one of the bestknown slogans of the twentieth century.[162] The trademark expired in the US in 2006, and was
replaced in that market with "Follow your taste" until 2010.[163] In 2011, the "finger lickin' good"
slogan was dropped in favor of "So good," to be rolled out worldwide.[162] A Yum! executive
said that the new slogan was more holistic, applying to staff and service, as well as food.[164]
"Nobody does chicken like KFC" was first introduced by KFC Australia in 1998, and has
continued to be used by the company in some markets.[165]
Logos
The first KFC logo was introduced in 1952 and featured a "Kentucky Fried Chicken" typeface
and a logo of the Colonel.[166] It was designed by the Lippincott & Margulies corporate identity
agency.[166] Lippincott & Margulies were hired to redesign it in 1978, and used a similar typeface
and a slightly different Sanders logo.[166] The "KFC" initialism logo was designed by Schechter
& Luth of New York and was introduced in 1991, and the Colonel's face logo was switched from
brown to blue ink.[167]
Landor redesigned the logo in 1997, with a new image of the Colonel. The new Colonel image
was more thinly lined, less cartoonish and a more realistic representation of Sanders. In 2006, the
Colonel logo was updated by Tesser of San Francisco, replacing his white suit with an apron,
bolder colors and a better defined visage.[168] According to Gregg Dedrick, president of KFC's
US division, the change, "communicates to customers the realness of Colonel Sanders and the
fact that he was a chef."[168]

Television

United States
21

KFC Yum! Center in Louisville, Kentucky

Advertising played a key role at KFC after it was sold by Sanders, and the company began to
advertise on US television with a budget of US$4 million in 1966.[169] In order to fund
nationwide advertising campaigns, the Kentucky Fried Chicken Advertising Co-Op was
established, giving franchisees ten votes and the company three when deciding on budgets and
campaigns.
In 1969, KFC hired its first national advertising agency, Leo Burnett.[22] A notable Burnett
campaign in 1972 was the "Get a bucket of chicken, have a barrel of fun" jingle, performed by
Barry Manilow.[22]
By 1976 KFC was one of the largest advertisers in the US.[170] Young & Rubicam (Y&R) was
KFC's agency of record in the US from 1976 until December 2000.[171] From 1978 to 1980 "It's
nice to feel so good about a meal" was the slogan.[172] It was chosen because KFC had identified
consumer guilt as its core marketing obstacle.[173] Meanwhile, KFC hired the Mingo-Jones
agency to target African American audiences.[174] Mingo-Jones coined the "We do chicken right"
slogan, which was later adopted across the whole chain from 1981 until 1990.[175] "Nobody's
cooking like today's KFC" was used from December 1990 until March 1991.[176]
From 1991 to 1994, the television campaign focused on the fictional town of Lake Edna.[177]
When he took over the CEO role at KFC, David Novak ended the campaign, which he derided as
"hokey."[178] The campaign was replaced by one with the tagline, "Everybody needs a little
KFC," which Novak credited with helping to boost sales at the company.[178]

22

BBDO took over the KFC US account in December 2000. Its first campaign, featuring Jason
Alexander, debuted on television in July 2001.[179] It ran until May 2003 with the tagline,
"There's fast food. Then there's KFC."[179] In September 2003, BBDO was replaced by Foote,
Cone & Belding.[180] Its first campaign aired in November, but was pulled after less than a month
following complaints from the National Advertising Division and the Center for Science in the
Public Interest that it advertised the health benefits of eating fried chicken.[181]
International
In 1994, Ogilvy & Mather became KFC's international agency of record.[182] From 1997 to 1999,
Ogilvy & Mather used celebrities such as Ivana Trump, Tara Palmer-Tomkinson and Ulrika
Jonsson to endorse KFC products in television advertisements in the UK.[183] After this
campaign, the agency simply adapted Y&R's American campaigns, such as the animated
Colonel, for a British audience.[156] In late 2002, BBH was appointed KFC's UK agency.[184] In
2003, the "Soul Food" campaign was launched, aiming to capture the young urban market with
1960s and 70s African-American music.[184] By 2005, this believed to have been a failure, and
KFC UK's marketing director left the company amid speculation that the US head office was
unhappy with the campaign.[184] Marketing subsequently moved towards a more familyorientated line.[184]

Promotional tie-ins and corporate sponsorships

In 2013, WPP's BrandZ valued the brand at US$10 billion.[185]

23

In 1994, KFC embarked upon its first US nationwide promotional tie in, with the Looney Tunes
franchise.[186] Customers could buy a Looney Tunes character 3D mug for $1.99 with each
$14.99 Mega Meal that was purchased.[186]
KFC in the US featured a Matchbox promotion in Spring 1995.[187]
Between November 1998 and January 2000, KFC US teamed with Nintendo, Game Freak and 4
Kids Entertainment in a Pokmon tie-in.[188] Pokmon themed promotional days were held,
Pokmon Beanie Babies were sold, and Pokmon toys were given away free with children's
meals.[188] In 1999, PepsiCo signed a $2 billion agreement with Lucasfilm in order to market Star
Wars themed meals in its KFC and Pizza Hut chains.[189]
Since 2010, KFC has sponsored the KFC Yum! Center in Louisville. In Australia, KFC has
sponsored the Big Bash League Twenty20 cricket tournament and Twenty20 international
matches since 2003.[190]

Controversies and criticism

Since the turn of the 21st century, fast food has been criticised for its animal welfare record, its
links to obesity and its environmental impact.[191] Eric Schlosser's book Fast Food Nation (2002)
and Morgan Spurlock's film Super Size Me (2004) reflected these concerns.[21] Since 2003,
People for the Ethical Treatment of Animals (PETA) has protested KFC's choice of poultry
suppliers worldwide.[192] The exception is KFC Canada, which signed an agreement pledging to
24

only use "animal friendly" suppliers.[193] PETA have held thousands of demonstrations,
sometimes in the home towns of KFC executives, and CEO David Novak was notably soaked in
fake blood by a protester.[193] President of KFC's US division Gregg Dedrick said PETA
mischaracterized KFC as a poultry producer rather than a purchaser of chickens.[194] In 2008,
Yum! stated: "[As] a major purchaser of food products, [Yum!] has the opportunity and
responsibility to influence the way animals supplied to us are treated. We take that responsibility
very seriously, and we are monitoring our suppliers on an ongoing basis."[195]
In 2006, Greenpeace accused KFC Europe of sourcing the soya bean for its chicken feed from
Cargill, which had been accused of clearing large swathes of the Amazon rainforest in order to
grow the crop.[196]

Protesters demonstrating outside a KFC restaurant in Royal Oak, Michigan

In May 2012, Greenpeace accused KFC of sourcing paper pulp for its food packaging from
Indonesian rainforest wood.[197] Independent forensic tests showed that some packaging
contained more than 50 percent mixed tropical hardwood fiber, sourced from Asia Pulp & Paper
(APP).[198][199] APP said such fiber can be found in recycled paper, or: "It can also come from
tree residues that are cleared, after a forest area has become degraded, logged-over or burned, as
part of a sustainable development plan. APP has strict policies and practices in place to ensure
that only residues from legal plantation development on degraded or logged-over forest areas and
sustainable wood fiber enters the production supply chain."[198] KFC said: "From a global
perspective, 60 percent of the paper products that Yum! (our parent company) sources are from
sustainable sources. Our suppliers are working towards making it 100 percent."[197]
In December 2012, the chain was criticized in China when it was discovered that a number of
KFC suppliers had been using growth hormones and an excessive amount of antibiotics on its
poultry in ways that violated Chinese law.[200] In February 2013, Yum! CEO David Novak
admitted that the scandal had been "longer lasting and more impactful than we ever
25

imagined."[200] The issue is of major concern to Yum!, which earns almost half of its profits from
China, largely through the KFC brand. In March 2013, Yum! Reported that sales had rebounded
in February, but that lower sales in December and January would result in a decline in samestore sales of 20 percent in the first quarter.[201]

News about KFC

KFC targets women customers
July 16, 2003

26

KFC IS aiming to broaden its appeal to women and develop a healthier image with the launch of its new
chicken salad, which will be backed by a TV campaign created by Bartle Bogle Hegarty. The spot, called
"street", is the latest execution in BBH's "got chicken, got soul" campaign, which aims to reposition KFC
as soul food by highlighting the social experience people share when eating its food. "Over the past five
years, we have introduced a number of innovations to broaden our appeal, and lunchtime has been...

Restaurant chains increasing vegetarian menu rapidly in the country

September 27, 2014 | Ratna Bhushan, ET Bureau
NEW DELHI: When Kentucky Fried Chicken, synonymous with its 'finger lickin good' positioning, altered
its tagline for India to 'so veg, so good' to promote its paneer zinger burger and veg twister this March, it
was not just a marketing fad. Since then the fast-food chain's sales of its vegetarian items in the country
have shot up by 50%. "On different days of the week, various people turn vegetarian for different
religious reasons. We realized we couldn't alienate...

KFC to open 500 outlets in India by 2015

November 1, 2010 | PTI
PANAJI: KFC, world's one of the biggest restaurant chain, expects to open 500 outlets by 2015 in India.
"We will be expanding to 500 stores by 2015," KFC India (Director Marketing) Unnat Varma told
reporters here. He said that KFC will be present in 75 cities by that time and will explore bigger cities
first before going to smaller markets. Varma said that they will increase their presence in states like
Maharashtra, Tamil Nadu, Orissa, and Uttar Pradesh...

Restaurant chains increasing vegetarian menu rapidly in the country

September 27, 2014 | Ratna Bhushan, ET Bureau
NEW DELHI: When Kentucky Fried Chicken, synonymous with its 'finger lickin good' positioning, altered
its tagline for India to 'so veg, so good' to promote its paneer zinger burger and veg twister this March, it
was not just a marketing fad. Since then the fast-food chain's sales of its vegetarian items in the country
have shot up by 50%. "On different days of the week, various people turn vegetarian for different
religious reasons. We realized we couldn't...

KFC owner says China scandal hurting sale

BEIJING: The owner of the KFC and Pizza Hut restaurant chains said Thursday a food safety scandal in
China has hurt sales and might be severe enough to cut into the company's global profit. Yum Brands
27

Inc., in a filing with the US securities regulator, gave no financial details and said it was too early to know
when sales might rebound. But it said if the "significant sales impact" continues, it might hurt this year's
profit. The scandal erupted last week when a...

China seals McDonald's, KFC supplies after stale meat scandal

BEIJING: Authorities in China have rushed to seal up suspicious meat products in fast food chains,
including McDonald's and KFC, after one of their suppliers was accused of selling stale meat. The move
came in response to media and public outcry after a Shanghai TV station exposed Shanghai Husi Food
Co. , a supplier to a string of fast food brands, including McDonald's and Yum Brands Inc., for selling
adulterated products with rotten meat and meat beyond its...

KFC to serve calorie count

October 23, 2009 | Ratna Bhushan, ET Bureau
NEW DELHI: Your finger lickin' chicken and Zinger burgers will soon have calorie counts on their labels,
as Yum! Brands, the $16-billion owners of Kentucky Fried Chicken fast-food restaurant, join the growing
number of foods and beverages companies hopping on to the health and nutrition platform. In an
exclusive interaction with ET, David C Novak, global chairman and CEO of the Kentucky-based fast-food
company that also owns Pizza Hut, Taco Bell and A&W Restaurants, said the move would be kicked off...

KFC owner says China scandal hurting sales

July 31, 2014 | AP
BEIJING: The owner of the KFC and Pizza Hut restaurant chains said Thursday a food safety scandal in
China has hurt sales and might be severe enough to cut into the company's global profit. Yum Brands
Inc., in a filing with the US securities regulator, gave no financial details and said it was too early to know
when sales might rebound. But it said if the "significant sales impact" continues, it might hurt this year's
profit. The scandal...

KFC earns $250 million annually from China

November 29, 2001 | BEIJING, PTI
American fast food giant, Kentucky fried chicken earned at least two billion Yuan (about $250 million)
from the Chinese mainland annually since the end of 1999, the state statistical bureau said. Tricon global
restaurants said that it had opened over 520 kfc chain stores in 130 cities in china. And over 99 per cent
of kfc stores in china have made a handsome profit, president of tricon in china, j Samuel su said. In fact,
western fast food restaurants now control a considerable market share in...

28

Yum! KFC is back on your plate

January 22, 2003 | Sutapa Raha, TNN
KOLKATA: It's time for Kentucky Fried Chicken to reappear on Indian plates. US-based Yum! Restaurants
International which owns brands like Pizza Hut, Long John Silvers, Taco Bell and others, has decided to
relaunch KFC in India. And Kolkata seems to be the hub which will flag-off KFC's spread in the country.
Devyani International (DIPL), the franchise for Pizza Hut and KFC in the north and east India, is slated to
open a 4000 sq ft KFC outlet in Harshavardhan Neotia promoted multiplex...

Court summons to top KFC executive quashed

January 30, 2012 | PTI
NEW DELHI: A magisterial court summons to top Indian executive of an US multinational firm, owning
popular KFC and Pizza Hut outlets, to answer charges of running a fast food eatery here without licence,
has been quashed by a session court. Additional Sessions Judge (ASJ) Rajeev Bansal quashed the
summons to India Managing Director Niren Chaudhary of US-based Yum! Brands, which owns food
chains KFC and Pizza Hut, saying the trial court order summoning the top...

Starbucks chicken products off shelves in China

July 22, 2014 | PTI
BEIJING: China has expanded meat scandal probe nationwide as Starbucks has become the latest
international chain to withdraw products from its shelves in the wake of the rotten meat in McDonald's,
KFC and Pizza Hut in Shanghai. An investigation into a meat scandal expanded nationwide as China's top
food quality watchdog launched a "thorough" probe, state-run Xinhua news agency reported. China
Food and Drug Administration asked local authorities to investigate all the...

Yum! Restaurants reports third straight drop in quarterly same store sales
July 18, 2014 | Ratna Bhushan, ET Bureau
NEW DELHI: Yum! Restaurants, owner of KFC and Pizza Hut restaurant chains, reported its third straight
drop in quarterly same store sales in India in the April-June period, indicating that high food inflation
and slowing discretionary spends continue to impact quick-service restaurants business in the country.
Yum! Restaurants reported a 2% decline in its same-store sales in India even as sales in its biggest
emerging market, China, bounced...

29

McDonald's, Pizza Hut, KFC, CCD & Domino's flourish: Quick Service
Restaurant industry on a...
May 28, 2014 | Amit Bapna, ET Bureau
Eating out has never been more exciting. 5 Quick Service Restaurant (QSR) brands find place in the Top
35 - McDonald's at 16, Pizza Hut at 17, KFC at 19, CCD at 27, and Domino's at 33. As the country gets
younger, the QSR industry in India is clearly on a roll, with the existing brands looking to expand and
new ones like Dunkin Donuts, Taco Bell, and Burger King mooring on Indian shores. The brands are aided
by innovations...

Dodsal Group to sell its Pizza Hut, KFC business; appoints Euromax Capital to
scout for buyers
April 8, 2014 | ET Bureau
MUMBAI: Dubai based Dodsal Group, which owns Pizza Hut chains in South and West India will sell its
food and fine dining company and has appointed boutique investment bank Euromax Capital to scout
for buyers, three people with direct knowledge of the development said. Kilachand family, the owners of
Dodsal, has decided to focus on its engineering and construction business in the Middle East, and exit
the quick service...

Aachi Kitchen plans Chettinad restaurant chains in five locations this year
January 4, 2014 | Sanjay Vijayakumar & Sangeetha Kandavel, ET Bureau
CHENNAI: Tamil Nadu-based masala brand is planning a chain of Chettinad restaurants, the latest
diversification of this nearly two-decade-old group inspired by the success of global chains such as KFC
and McDonalds. Aachi Kitchen, as the new venture will be known, will start in the first quarter of this
year in five locations. "First, I want to see whether I can sustain and then blow the trumpet," says
founder and chairman of the group AD...

'We are focusing on KFC now'

July 22, 2006 | Yamini Dhall, TNN
Yum! Restaurants International is the world's second largest quick service food retailer. Its fast food
brand Pizza Hut is perhaps the largest sit-down quick service restaurant chain in India. Sandeep Kohli,
MD, Indian subcontinent, spoke about the company's business models, brand strategy and expansion

30

plans, among other issues in the Indian market. Excerpts: How much of an issue is real estate for the
quick service restaurant industry? Real estate is the single...
NEWS

KFC net profit rises by 7.4%

June 28, 2011 | ET Bureau
KOCHI: Kerala Financial Corporation (KFC) has clocked a 7.4 % in the net profit at Rs 35.82 crore for
2010-11. The company declared a dividend of 5 % for the year. Business portfolio increased by 26.4 % to
Rs 1125 crore and the disbursements rose 6 % to Rs 444 crore. The recovery of loans has improved by
18.73 % to Rs 355 crore. To retain quality portfolio and to minimize gap between sanction and
disbursement, the corporation contained its sanction level to Rs...
NEWS

Taco Bell will beat KFC in India: David Novak, CEO, YUM! Brands
October 23, 2013 | Samidha Sharma, TNN
PANAJI: Yum! Brands - which operates fast-food chains like KFC, Taco Bell and Pizza Hut - will invest $10
billion along with its franchise partners in emerging markets by 2020, as it pushes a China-like,
expansion-driven growth model in India. Calling Yum! Brands an emerging market powerhouse, David
Novak , chairman and CEO of the $13-billion Louisville, Kentucky-based restaurant group, said India will
start to significantly contribute to the company's overall...

Yum, partners to invest $10 bn in emerging markets by 2020

October 22, 2013 | PTI
NEW DELHI: Yum! Brands Inc that owns KFC and Pizza Hut chains plans to invest $10 billion along with its
franchise partners to have 20,000 restaurants in emerging markets, including India, by 2020. The fast
food chain, which today announced its 40,000th restaurant globally with the opening of an outlet in
Goa, also said that by 2015 it will have over 1,000 KFC, Pizza Hut and Taco Bell outlets in more than 100
cities in India division that...

Origin
Harland Sanders was born in 1890 and raised on a farm outside Henryville, Indiana.[5] His father
died in 1895, forcing his mother to work at a canning plant.[6] As the eldest child at the age of
five, Sanders was left to care for his two siblings.[6] After he turned seven, his mother taught him
how to cook.[5] After leaving the family home at age 13, Sanders passed through several
professions including railroad worker and insurance salesman, with mixed success.[7] In 1930, he
took over a Shell filling station on US Route 25 just outside North Corbin, a small city on the

31

edge of the Appalachian Mountains.[6] By June, he had converted a storeroom into a small eating
area using his own dining table, serving meals such as steaks and country ham to travelers.[8]

The Harland Sanders Caf and Museum

In 1934, Sanders took over the lease of the Pure Oil filling station on the other side of the road,
due to its greater visibility for motorists.[9] He then began to sell fried chicken.[10] To improve his
skills, Sanders took an eight-week restaurant-management course at the Cornell University
School of Hotel Administration.[11] By 1936, his business had proved successful enough for him
to be given the honorary title of Kentucky colonel by Governor Ruby Laffoon.[12] In 1937,
Sanders expanded his restaurant to 140 seats, and in 1940 purchased a motel across the street, the
Sanders Court & Caf.[13]
A sander was dissatisfied with the 35 minutes it took to prepare his chicken in an iron frying pan,
but he did not want to deep fry. Although a much faster process, in Sanders' opinion it produced
dry and crusty chicken that was unevenly cooked.[14] On the other hand, if he prepared the
chicken in advance of an order, there was sometimes waste at the end of the day.[5] In 1939, the
first commercial pressure cookers were released onto the market, predominantly designed for
steaming vegetables.[15] Sanders bought one and modified it into a pressure fryer, which he then
used to prepare chicken.[16] The new method reduced production time to be comparable with
deep frying, yet, in Sanders' opinion, retained the quality of pan-fried chicken.[14] In July 1940,
Sanders finalised what came to be known as his Original Recipe of 11 herbs and spices.[17]
Although he never publicly revealed the recipe, he admitted to the use of salt and pepper, and
claimed that the ingredients "stand on everybody's shelf".[13][18]
After being recommissioned as a Kentucky colonel in 1950 by Governor Lawrence Wetherby,
Sanders began to dress the part, growing a goatee and wearing a black frock coat (later switching
32

to a white suit), a string tie, and referring to himself as "Colonel".[13][19] His associates went
along with the title change, "jokingly at first and then in earnest", according to biographer Josh
Ozersky.[20]

Early franchisees

The first KFC franchise, located in Salt Lake City

The Sanders Court & Caf generally served travelers, so when the route planned in 1955 for
Interstate 75 bypassed Corbin, Sanders sold his properties and traveled the US to market his
chicken concept to restaurant owners.[21] Independent restaurant owners would pay five cents on
each chicken sold as a franchise fee, in exchange for Sanders' "secret blend of herbs and spices",
his recipe and method, and the right to advertise using his name and likeness.[22] In 1952 he had
already successfully franchised his chicken recipe to Pete Harman of South Salt Lake, Utah, the
operator of one of the largest restaurants in the city.[23] Don Anderson, a sign painter hired by
Harman, coined the name "Kentucky Fried Chicken".[24] Sanders adopted the name because it
distinguished his product from the deep-fried "Southern fried chicken" product found in
restaurants.[25]
Harman claimed that in his first year of selling "Kentucky Fried Chicken", his restaurant sales
more than tripled, with 75 percent of the increase coming from the sale of fried chicken.[26] In
Utah, a product from Kentucky was exotic and evoked imagery of Southern hospitality.[24]
As a franchise-led operation, KFC's success depended on the work of the early franchisees, and
Harman has been described as the "virtual co-founder" of the chain by Sanders' biographer.[27]
Harman trademarked the phrase "It's finger lickin' good", which was eventually adopted as a
slogan across the entire chain.[22] In 1957 Harman bundled 14 pieces of chicken, five bread rolls
and a pint of gravy into a cardboard bucket, and offered it to families as "a complete meal" for
US$3.50 (around US$30 in 2014).[24] He first trialled the packaging as a favor to Sanders, who
had called on behalf of a Denver franchisee who did not know what to do with 500 cardboard
buckets he had bought from a traveling salesman.[24]
33

Dave Thomas was a franchisee from the mid-1950s, and developed the rotating bucket sign that
came to be used at many KFC locations.[28] Thomas reported that Sanders' fried chicken was a
"sensation" from the first day he offered it in his restaurant, with queues lining outside the
door.[29] He was an early advocate of the take-out concept that Harman had pioneered, and
introduced a bookkeeping form that Sanders rolled out across the entire KFC chain.[22][30]
Thomas sold his shares in 1968 for US$1 million (around US$7 million in 2013), and became
regional manager for all KFC restaurants east of the Mississippi before founding the Wendy's
restaurant chain in 1969.[28][31]
In 1960, Sanders moved the company headquarters from Corbin to Shelbyville, Kentucky, which
had better transport links through which he could distribute his spices, pressure cookers, take-out
cartons and advertising material to franchisees.[11]

Sale by Sanders
KFC popularized chicken in the fast food industry, diversifying the market by challenging the
established dominance of the hamburger.[32] In 1960 the company had some 200 franchised
restaurants; by 1963 this had grown to around 600, making it the largest fast food operation in
the United States.[21] In 1963, Sanders met John Y. Brown, Jr, the son of his lawyer, John Y.
Brown, Sr., at a political breakfast.[33] Brown told Sanders that he was keen to join the company,
which had developed a strong reputation in the Kentucky area.[34] According to Brown, Sanders
had lost interest in the business operations of KFC.[33] Sanders explained that he saw useful
qualities in Brown, such as youth, enthusiasm and vision.[35] Brown and franchisee Dave Thomas
agreed that Sanders "wasn't a very good businessman".[36][37]
Brown convinced the financier Jack C. Massey to provide 60 percent of the acquisition capital,
and provided a major contribution himself, with smaller contributions from franchise holder Pete
Harman and company officials Lee Cummings and Harlan Adams.[38] Sanders then began to
have doubts about selling the company, as members of his family were against it.[39][40] Knowing
that Sanders placed faith in astrology, Massey waited until he had a particularly positive and
dramatic horoscope before offering a price for the company.[39] When Massey made the written
offer, Sanders read the figure, immediately consulted his horoscope, then agreed to sell.[39] The
group of investors acquired the company from Sanders in 1964 for US$2 million (around US$15
million in 2013).[12] The contract included a lifetime salary for Sanders and the agreement that he
would be the company's quality controller and trademark.[41] Harman believed that establishing a
continuity of leadership and a firm central control would prevent possible disputes among
franchisees and Sanders' family.[42]

GROWTH
Massey and Brown introduced standardization to the fragmented company.[38] After visiting Pete
Harman's operations in Utah, they began to implement the stand-alone take-out model across the
entire chain.[38] Franchisees were ordered to delist their own menu items so that they could
concentrate on KFC products.[43] The restaurants were re-branded with a distinctive red-andwhite striped color pattern and mansard roofs with cupolas.[44] The roll-out of freestanding stores

34

accelerated the company's growth as outlets exclusively selling fried chicken proved to be more
appealing to potential franchisees.[22]
Sanders did not approve of all of the changes to the company that he had founded, and became
incensed when Massey moved company headquarters from Kentucky to Nashville, Tennessee,
which was closer to where Massey lived.[45] Sanders bellowed, "This ain't no goddam Tennessee
Fried Chicken, no matter what some slick, silk-suited sonofabitch says".[45] Sanders also became
frustrated with some of the changes to the company, such as introducing an initial franchisee fee
of $4,000, and charging franchisees a percentage of total sales rather than a nickel per chicken
sold.[46] Sanders also believed that the company had reneged on their contract with him when
they opened operations in Canada, because as he understood it, the contract had granted him the
exclusive rights to operate in the country.[47] Sanders complained to the press The Washington
Post, "I don't like some of the things John Y. done to me. Let the record speak for itself. He overpersuaded me to get out".[48] The outburst was embarrassing for Brown, who argued that he made
the management structure more efficient and treated the increasingly disgruntled Sanders with
tact and patience.[45]
KFC was forced to renegotiate with Sanders regarding the Canadian activities, as he owned $1.5
million worth of stock and was using it to prevent Massey from listing the company publicly
until his points of issue were addressed.[49] Brown and Massey claimed that Sanders only had the
rights to process chicken in Canada.[47] After they renegotiated the contract to guarantee Sanders
exclusive rights over Canada, he sold his stock to them, and the company went public in 1966.[49]
After going public, the company bought out its 600 franchisees, and directly operated them
itself.[40] Later that year, Massey resigned from day-to-day management of the company
(although he remained as chairman), and Brown announced that headquarters would be moved to
Louisville, Kentucky.[45]
By 1967, KFC had become the sixth largest restaurant chain in the US by sales volume, and 30
per cent of sales were take-out.[43][44] Brown felt that the company had to expand quickly, or else
emerging rivals such as Church's Chicken would steal the company's lead; 863 outlets were
opened in 1968.[40] The company's growth pushed its stock value to "stratospheric" levels,
according to Reuters, and in 1969 it was listed on the New York Stock Exchange.[39][50]
Meanwhile, KFC entered into ventures with other companies. In 1969, Brown launched the
"Kentucky Roast Beef" restaurant chain, and "Colonel Sanders Inns" motels.[51] Brown believed
that the Colonel Sanders brand could be used to market anything, but these two ventures quickly
failed.[52] That same year, KFC entered a joint venture with the California-based fish and chips
chain H. Salt Esquire, which proved more successful, but was sold off in 1980.[53][54]
Massey resigned as chairman of the company in March 1970, and Brown took over his role.[55]
The chain had reached 3,000 outlets in 48 different countries by 1970, but expansion was often
chaotic and poorly executed.[43] When he was promoted to regional manager, Dave Thomas
complained that the company had become too "corporate", sent him "a lot of Mickey Mouse
memos" and that Brown lacked motivational skill.[56] A member of KFC senior management
described the international strategy as "throwing some mud against the map on the wall, and
hoping some of it would stick."[57] The first outlet in Japan was opened after just two weeks
preparation, and it proved to be a costly failure, losing $400,000 during its opening month and
35

wasting more chicken than it sold.[57] Operational problems became clear in July 1971, after the
company reported its first ever profit loss from the prior six-month period.[58]

Heublein and strained relations with Sanders; R.J. Reynolds

This sign displays the KFC logo as used between 1978 and 1991

Once too large for Sanders to manage, Kentucky Fried Chicken grew to overwhelm John Y.
Brown as well.[50] In July 1971, Brown sold the company to the Connecticut-based Heublein, a
packaged food and drinks corporation, for US$285 million (around US$1.6 billion in 2013).[59]
Brown personally gained around $35 million from the sale.[60] Reuters opined that the takeover
probably saved the company from disaster.[50] Heublein planned to increase KFC's volume with
its sales and marketing expertise.[61]
Meanwhile, Church's Chicken began making inroads into KFC's market share with their "Crispy
Chicken" product.[45] KFC responded in 1972 when it introduced "Extra Crispy Chicken".[62] In
1973, the introduction of barbecue spare ribs caused "tremendous" operating problems.[63] After
the product was launched there was a shortage of pork, which pushed prices beyond what
customers were willing to pay.[64] When management withdrew the product, they realized that
fried chicken sales had been decreasing.[63] Meanwhile, Sanders increasingly regretting selling
the company, and his relationship with the new owners had soured.[65] He began to complain of
the company's declining food quality to the media:
My God, that gravy is horrible. They buy tap water for 15 to 20 cents a thousand gallons and
then they mix it with flour and starch and end up with pure wallpaper paste ... And another
thing. That new crispy recipe is nothing in the world but a damn fried doughball stuck on some
chicken.[66]

36

The outburst prompted a KFC franchisee in Bowling Green, Kentucky, to unsuccessfully attempt
to sue Sanders for libel.[13] In 1973, Heublein attempted to sue Sanders after he opened a
restaurant in Shelbyville, Kentucky, under the name of "Claudia Sanders, the Colonel's Lady
Dinner House".[67] In retaliation, Sanders attempted to sue Heublein for US$122 million (around
US$570 million in 2013) over the alleged misuse of his image in promoting products he had not
helped develop, and for hindering his ability to franchise restaurants.[68] A Heublein spokesman
described it as a "nuisance suit".[68] In 1975, Heublein settled out of court with Sanders for US$1
million (around US$4 million in 2013), and allowed his restaurant venture to go ahead under the
reworked name: "Claudia Sanders Dinner House".[67]
Overconfidence led KFC to fail in some overseas markets, such as Hong Kong, which the
company abandoned in 1975 after two years in operation.[69] Sanders continued to attack
Heublein publicly, and in 1976 complained that the company "doesn't know what it's doing" and
that it was "downright embarrassing" to have his image associated with such a poor quality
product.[70] Michael A. Miles was promoted by Heublein to run the chain in 1977 and is credited
with turning around the ailing company by instituting a back-to-basics formula.[71] Miles lured
Sanders back, and listened to his recommendations for the business.[71] Miles also embarked on
an extensive store refurbishment program, as outlets had become dated and run-down.[71] From
the late 1970s, outlets in the United Kingdom and Australia began to be refurbished from takeout outlets into sit down restaurants.[72] Sanders died in 1980 from pneumonia, having continued
to travel 200,000250,000 miles a year up to this time, largely by car, promoting his
product.[26][73] By branding himself as "Colonel Sanders", Harland became a prominent figure of
American cultural history, and his image remains widely used in KFC advertising.[32] By the time
of his death, there were an estimated 6,000 KFC outlets in 48 different countries worldwide, with
$2 billion of sales annually.[11]
KFC expanded internationally in the 1970s and 1980s, particularly in Japan, Australia and the
United Kingdom.[74] After the General Cinema Corporation purchased 18 percent of its stock in
1983, Heublein feared it would be subject to a hostile takeover, and approached R. J. Reynolds,
the tobacco firm, to act as a white knight and acquire the company for $1.3 billion.[75] That year,
Michael Miles resigned as chairman of KFC to take the role of CEO at Kraft Foods, and Richard
Mayer took over his role.[76] Reynolds had to contend with the introduction of Chicken
McNuggets across the McDonald's chain in 1983; KFC introduced its own brand of chicken
nuggets, called "Kentucky Nuggets" in 1985.[77] In 1984, Reynolds dedicated $168 million for
capital expansion at KFC.[78]

Acquisition by PepsiCo
In July 1986, Reynolds sold KFC to PepsiCo for a book value of $850 million (around US$1.8
billion in 2013).[79] At the time, PepsiCo had interests in soft drinks and snacks, and also owned
the restaurant chains Pizza Hut and Taco Bell. Reynolds divested KFC in order to pay off debt
related to its recent purchase of Nabisco and to concentrate on its tobacco and packaged food
business.[80] It was anticipated that PepsiCo would bring their merchandising expertise to the
company.[80] Dan Koeppel of Ad week believed that the chain had been suffering from corporate
neglect, menu stagnation and mixed marketing messages; Nancy Giges of Advertising Age felt

37

that the chain had been "smartly revived" by R. J. Reynolds.[81][82] KFC chairman Richard Mayer
was of the opinion that Reynolds had treated their restaurants division as a "hobby".[83]
PepsiCo's acquisition was seen by some analysts as a means for the company to increase its soft
drinks sales.[82] Before the takeover, only 1,000 of the 6,500 KFC outlets sold Pepsi Cola.[84]
PepsiCo chairman D. Wayne Calloway stressed that soft drink preference was not a factor in the
KFC takeover.[82] PepsiCo switched 1,800 company owned stores to their own soft drinks with
immediate effect.[84] KFC management had previously given franchisees the freedom to sell any
soft drinks they wanted, but PepsiCo stated that it hoped it could convince them to stock Pepsi
products.[82] The purchase of KFC by PepsiCo led to some fast food competitors switching from
Pepsi to Coca-Cola.[85] One of the first to switch was Wendy's, whose chairman, Robert Barney,
stated, "In recent months, Pepsi has acquired another restaurant chain. Their interests are now in
conflict with Wendy's and we will not support a company that is trying to make our customers its
customers."[85] In 1990, Burger King also switched to Coca-Cola from PepsiCo, citing the
growth of PepsiCo as a rival as a "large factor" in the switch.[86]
By July 1987, the "Chicken Little", an inexpensive chicken slider made from dark meat, was
introduced across KFC's US stores, aimed at capturing the lunchtime market.[87] Sales were
reportedly disappointing, despite a $31 million advertising campaign.[88] In November 1987,
KFC became the first Western restaurant chain in China, with an outlet in Beijing.[89] In 1989,
first quarter sales at KFC rose 30 percent to US$280 million.[90] In July, president and CEO
Richard Meyer left KFC in order to become the CEO at Kraft Foods, and was replaced by John
Cranor III.[91]
International growth and franchisee disputes under John Cranor III

Zinger chicken burgers in India.

In August 1989, Cranor proposed amendments to the existing 1976 contract for US franchisees:
PepsiCo could take over weak franchises, existing restaurants would not be safeguarded against
competition from new outlets, and PepsiCo would have the right to increase royalty fees.[92] The
contract proved controversial amongst franchisees, who countered with a lawsuit, and the issue
was not resolved until 1996.[93] PepsiCo was accused of behaving in an imperious manner
towards franchisees, who it believed were holding back the firm's growth, while the franchisees
believed they had been the backbone of the company during a succession of indifferent corporate
owners.[81]
38

Cranor spent $42 million restructuring the company's operations worldwide.[94] He invested an
additional $50 million to refurbish outlets and $20 million on a new computer system to link
outlet cash registers to the kitchen, drive-through window, manager's office and company
headquarters.[94] Cranor also expanded the chain into non-traditional locations, beginning with a
150 sq ft kiosk selling seven items at a General Motors assembly plant in Dayton, Ohio.[94]
Between 1986 and 1991, the chain built a further 2,000 outlets to bring its total number to 8,500,
and sales grew from $3.5 to $6.2 billion.[94] The chain had to contend with the rise of grilled
chicken as Americans became increasingly health conscious.[91] KFC found itself competing
against the growing El Pollo Loco restaurant chain, as well as with Burger King, which had just
introduced the BK Broiler, a grilled chicken burger.[91] Delays in product development, cramped
kitchens and the ongoing franchisee contract dispute prevented the chain from rolling out a
grilled product of its own.[81] Franchisee relations became tenser still when, in August 1990,
PepsiCo announced plans to roll out a home delivery service at all 5,000 US outlets by January
1991, without informing franchisees beforehand.[81]
In March 1991 the KFC name was officially adopted, although the chain was already widely
known by that initialism.[95] The change was advised by the Schechter Group brand consultancy
agency.[96] Research demonstrated that 80 percent of customers already associated the "KFC"
initials with Kentucky Fried Chicken.[96] A spokesman for the chain said that it represented its
diversified menu, which was moving away from solely fried products.[97] Kyle Craig, president
of KFC US, admitted the change was an attempt to distance the chain from the unhealthy
connotations of "fried".[98] In 1994, Milford Prewitt praised the "crafty and well-timed
repositioning" in Nation's Restaurant News.[99] On the other hand, a 2005 editorial in Advertising
Age stated, "the chain's jettisoning of a venerable nameand distancing from the word fried
was ill-conceived and damaging. It made a clear brand fuzzy."[100]
The early 1990s saw successful major products launched throughout the chain, including spicy
"Hot Wings" (launched in 1990), popcorn chicken (1992), and, outside the US, the "Zinger", a
spicy chicken fillet burger (1993).[101] In 1993, rotisserie style chicken, under the name
"Colonel's Rotisserie Gold", was introduced at over 30 per cent of US outlets.[102] However,
despite a $100 million investment in marketing, the product failed to gain sales traction.[103] The
launch of skinless chicken, designed to appeal to health-conscious customers, failed; customers
disliked the unfamiliar texture, and the product resulted in increased overheads, which
contributed to a 37 percent decline in operating profits in 1991.[104][105]
In June 1991, Singapore was chosen for the launch of the first ever KFC breakfast menu.[106]
Products included chicken sausage, omelettes and scrambled eggs, sold under the "Colonel's
Country Breakfast" banner.[106] Singapore was chosen for the launch due to the growth of the
breakfast market in that country.[106]
While the US division struggled, becoming the weakest part of PepsiCo's restaurants division,
elsewhere sales boomed, with particular success in Japan.[86] By 1992, slightly under half of all
sales were outside the US.[107] By 1993, KFC in the Asia Pacific region accounted for 22 percent
of all KFC sales.[89] John Cranor announced, "We're looking at almost unlimited opportunity for
growth in Asia".[108] By 1993, KFC was the leading Western fast food chain in South Korea,
China, Thailand, Malaysia and Indonesia, and was second to McDonald's in most other Asian
39

markets, including Japan and Singapore.[108] Overseas operations often flourished while local
management ignored or even defied orders from Louisville headquarters.[109]
David Novak appointed President
By 1994, KFC had a total of 9,407 outlets worldwide, including 5,149 outlets in the US, and over
100,000 employees.[110] That year, the chain began to struggle after competitors such as
McDonald's introduced value menu offerings.[111] After a disappointing set on quarterly earnings,
Cranor left the company in January 1994.[99] In his wake, two executives with marketing
backgrounds were charged with reviving the company.[112] Roger Enrico was appointed as the
CEO of PepsiCo Worldwide Restaurants, and David C. Novak was appointed President of KFC
in North America.[112]
In 1995, Novak introduced two successful new products Crispy Strips (breaded strips of
chicken) and the chicken pot pie the chain's first major new product launches in almost two
years.[111] Novak credits an improved, more "open" relationship with franchisees for the
introduction of the two new items: Crispy Strips were invented by an Arkansas franchisee, and
the pot pie was similarly developed alongside franchisees.[113] Meanwhile, less popular items,
such as corn muffins, were removed from the menu.[114] At the same time, Enrico scaled back the
increasing competition between KFC and its sister companies, Taco Bell and Pizza Hut; Taco
Bell had begun offering its own chicken products, and KFC had attacked Pizza Hut in its
marketing.[114]
In 1996 the company repaired its relationship with its franchisees by immediately dropping the
most contentious of the contract terms that had been proposed by chairman John Cranor five
years previously.[115] The 1976 contract was restored, including the 1.5 mile outlet exclusivity
zone, while the parent company gained greater control over national advertising.[115] Afterwards,
Novak oversaw ten fiscal quarters of consecutive growth at KFC North America.[116]
Novak axed the Colonel' Rotisserie Gold product and introduced a new non-fried item called the
Tender Roast.[117] Tender Roast was served by piece, as with the fried chicken, in contrast with
the rotisserie product, which had been sold in quarter, half or whole chicken portions.[117]
As a result of his success at KFC North America, Novak became President and CEO of the entire
KFC organization in 1996.[118]

40

Spin-off as Tricon (later Yum! Brands)

Protesters outside a KFC in Michigan in 2007

In August 1997, PepsiCo spun off its poorly performing restaurants division as a public company
valued at US$4.5 billion (around US$6.5 billion in 2013).[119] although KFC had been doing
well, Pizza Hut and Taco Bell had been under-performing. One PepsiCo executive admitted,
"Restaurants weren't our schtick".[120][121] The new company, named Tricon Global Restaurants,
had 30,000 outlets and annual sales of US$10 billion (around US$14 billion in 2013) at the time,
making it second only to McDonald's in global sales.[122]
In May 1997, the "Tower Burger", a fried chicken fillet burger with the addition of a hash brown,
was first launched in the United Kingdom.[123] In July 1997, the Twister wrap was launched in
most US KFC stores.[124] It was the first KFC chicken item to be served cold, and it used leftover
fried chicken that would otherwise have been discarded.[125] the product underperformed in the
US, and was withdrawn by May 1998.[126] after a revamped Twister wrap became a success in
Australia, the product was rolled out internationally. The new Twister was served hot and used
the "Crispy Strip" chicken strips, peppery mayonnaise, lettuce and tomato.[125] By 1998, the
majority of KFC franchisees had agreed to stock PepsiCo soft drink products.[127] In September
1999, the chain launched a $75 million advertising campaign for its new range of chicken
burgers, which were aimed at capturing the lunchtime market.[128] The Triple Crunch, Triple
Crunch Zinger and Original Recipe were fried, while the Tender Roast and Honey BBQ were
not.[128] The campaign was KFC's most expensive to date.[128] In November 1999 the first outlet
run by an all-deaf or partially deaf staff was opened in Malaysia.[129]
Since the turn of the 21st century, fast food has been criticized for its animal welfare record, its
links to obesity and its environmental impact.[130] Eric Schlosser's book Fast Food Nation (2002)
and Morgan Spurlock's film Super Size Me (2004) reflected these concerns.[24] Since 2003,
People for the Ethical Treatment of Animals (PETA) has protested KFC's choice of poultry
suppliers worldwide with the Kentucky Fried Cruelty campaign.[131] PETA have held thousands
of demonstrations, sometimes in the home towns of KFC executives, and CEO David Novak was
41

soaked in fake blood by a protester.[132] KFC President Gregg Dedrick said PETA
mischaracterized KFC as a poultry producer rather than a purchaser of chickens.[133] In 2008,
Yum! stated: "[As] a major purchaser of food products, [Yum!] has the opportunity and
responsibility to influence the way animals supplied to us are treated. We take that responsibility
very seriously, and we are monitoring our suppliers on an ongoing basis."[134]

The Double Down sandwich was launched in 2010

Tricon was renamed Yum! Brands in May 2002.[135] That year, the chain had to contend with
Burger King's launch of the Chicken Whopper, as well as fried chicken offerings from the
Domino's and Papa John's pizza chains.[105][136] Within three months, the Chicken Whopper
became Burger King's most successful launch of all time, with sales of 50 million.[105] In
September 2002, KFC sales were down 10 percent against the previous year.[136] From 2002 to
2005, KFC experienced three years of weak sales, when underinvestment in product
development left the brand looking "tired and poorly positioned", according to Restaurant
Research, an independent consultancy.[121] A roast chicken product line introduced in 2004
proved unsuccessful, and the worldwide avian flu scare of 2005 temporarily decreased sales by
as much as 40 per cent.[137][138] KFC responded in March 2005 by adding a cheap, small chicken
burger to the menu called the "Snacker".[121] It proved to be one of the chain's most successful
product launches to date, with over 100 million in sales.[139] In international markets, KFC
introduced the "Boxmaster", a meal-sized wrap in a box. KFC also began a makeover of the US
brand image, bringing back the full "Kentucky Fried Chicken" name at some outlets and
returning portraits of Colonel Sanders to prominence.[121]
In 2009, KFC International launched the Krusher (Krushem in some markets) line of frozen
beverages. The product was an attempt to introduce a between-meals snack to KFC, and was
marketed towards teenagers.[140] In April 2010, the Double Down sandwich was launched.[141]
Criticised as an unhealthy product, it featured two pieces of fried chicken in lieu of a
conventional bread bun.[141] It has proved to be a success for the company, with 15 million
Double Downs sold worldwide between March 2011 and March 2013.[142] In September 2012,
the Chicken Little sandwich returned in the US.[143]
42

By December 2013, there were 18,875 KFC outlets in 118 countries and territories around the
world.[2][144] KFC is the second largest restaurant chain in the world by sales after
McDonald's.[145]
In April 2014, Yum! announced that first quarter KFC sales had risen by 11 percent in China,
following a 15 percent fall in 2013.[146]
In July 2014, Chinese authorities closed down the Shanghai operations of the OSI Group, amidst
allegations that it had supplied KFC with expired meat.[147] Yum! immediately terminated its
contract with the supplier, and stated that the revelation had led to a "significant [and] negative"
decline in sales.[148]

10 Crazy Facts about KFC That You Might Not Know

KFConce known as Kentucky Fried Chickenis one of the most well-known brands in
American fast food. With the lions share of the fast food fried chicken market, KFC restaurants
are a pretty common sight in any town or city. However, the chain itself is not as tame as you
would think. Here are 10 wild facts about KFC that you might not know.
43

It may be disappointing to find out that KFC in fact does not breed mutant chickens, a popular
Internet hoax debunked by Snopes.com, but the chain does have some surprises in its long
history. The brand started as a restaurant attached to a gas station in 1930, and a lot can happen
in that span of time.
1. They Fiercely Guard Their Secret Recipe
KFC maintains that they use a secret blend of 11 herbs and spices; its been in their advertising
for awhile. The website BuzzFeed.com maintains that the handwritten recipe for the exact name
and amount of each spice is locked in a vault at the chains corporate location in Louisville,
Kentucky.
2. KFC Parent Company Has Many Famous Kids
KFC is currently owned by YUM! Brands. They also operate or once owned Taco Bell, Long
John Silvers, A&W, Wing Street, and Pizza Hut. The family reunion must be a fast food fest!
3. They Have a Creepy Reputation in China
KFC was one of the first franchises to move into Asian markets. The chains slogan used to be
finger-licking good, which was changed in 2011. According to the BuzzFeed.com article, KFC
didnt do such a good job of translating its slogan when it moved into China. According to the
website, that slogan was erroneously translated into Chinese as eat your fingers off. Doesnt
sound quite as tasty, does it?
4. Theres a Rumor They Stole from Wendys Founder
Rumors and hoaxes certainly do abound in the fast food world. Theres one going around that
Wendys Founder Dave Thomas was once a franchisee of KFC and designed their popular fried
chicken bucket; that rumor is contradicted by attributing the bucket invention to a different man
altogether, Pete Harman, according to Yahoo Voices.
5. They Changed Their Name to KFC to Downplay Fried
According to that hoax debunked by Snopes.com, KFC changed its name from Kentucky Fried
Chicken because the U.S. government banned them from using the word chicken (the chain
was using mutant chickens, remember?). The fact of the matter is KFC just wanted the word
fried out of its title due to the increasingly popular trend of eating healthy food.
6. KFCs Founder was a Troublemaker
Harland David Sanders, the founder of KFC, certainly wasnt born with a silver spoon. He
moved out of his home at the age of 13 because he didnt get along with his stepfather, and he
lied about his age to enlist in the U.S. Army at the age of 16. He was also fired two different
times for fighting; once as a railroad worker scrapping with another employee and once as a
lawyer fighting with his own client while in court.
44

7. KFC Started in a Gas Station

KFCs founder, Sanders, held many different jobs in his lifetime, according to KFCs own
biography. One of his last jobs before becoming the Colonel was the owner of a gas station. To
increase his income, he started selling fried chicken out of his own house, feeding customers at
his own dinner table. He did this for four years before opening a venue with tables just for
customers.
8. Colonel Sanders Was Not a Real Colonel
While Sanders did enjoy a brief stint in the U.S. Army, his title of Colonel was not from the U.S.
military. Its a title of honor meant to denote good service or high accomplishments that benefit
the state of Kentucky. Sanders was awarded the title in 1935 by Gov. Ruby Laffoon, who
awarded the title to more than 5,000 other Kentuckians during his governorship.
9. The Original Fried Chicken Was Done in a Pressure Cooker
Pressure cookers were invented right about the same time that Sanderss chicken restaurant
business was starting to really take off. The pressure cooker reduced the amount of time it took
to cook the chicken versus pan frying it and Sanders didnt want to deep fry it. However
Kentucky Pressure-Cooked Chicken doesnt sound quite as good.
10. KFC Is Dragging YUM! down in China
YUM! Brands is just about killing it on all fronts: Taco Bell has had a few good years with its
Doritos-flavored tacos and revenue is through the roof. Except in China. KFC is pretty common
in the largest Asian country, but it is not doing so well at the moment. Fears of bird flu are
keeping Chinese diners away from KFC and its chicken meals

45

KFC Allegedly Not Serving Real Chicken The Truth About KFCs Name
Change

KFC Allegedly Not Serving Real Chicken The Truth About KFCs Name Change. KFC
has been a part of our American traditions for many years. Many people, every day, eat at
KFC religiously. However, do they really know what they are eating?

46

During a recent study of KFC done at the University of New Hampshire, they
allegedly found some very upsetting facts. First of all, why did they change their name?
Several years ago Kentucky fried chicken became KFC. Does anybody know why? Most
thought the real reason was because of the fried food issue. But that is not the case. The
real reason why they call it KFC is because they allegedly cannot use the word chicken
anymore. Why? KFC does not use real chickens? They allegedly use genetically
manipulated organisms.

These so-called chickens are kept alive by tubes inserted into their bodies to pump blood and
nutrients throughout their structure. They have no beaks, no feathers and no feet. They grow with
multiple legs and wings on one chicken. Their bone structure is dramatically shrunk to get
more meat out of them. This is great for KFC because it saves them money for their production
costs. There is no more plucking of the feathers or the removal of the beaks and feet. The
47

government allegedly required them to change their name and banned them from using the word
chicken.

KFCs PLAN
KFC Plans to Expand New Restaurant
Jul 31 14
KFC announced that it plans to expand. In particular, its subsidiary Fast Foods AKK has opened
a new KFC restaurant in Vilnius.
KFC Corporation Announces Availability of Extra Crispy Boneless for Limited Time
Jan 13 14
KFC Corporation has announced the availability of Extra Crispy Boneless in restaurants
nationwide through February 2, 2014. The Extra Crispy Boneless Go Cup is available for just
$2.49 and the Favorites Bucket is only $12.99 (All prices at participating locations for a limited
time. Tax not included.).
KFC Announces Twist to Boneless Chicken
Jan 2 14
KFC announced twist to its Boneless chicken by offering it for a limited time in the brand's
signature Extra Crispy(TM) recipe. Extra Crispy Boneless will be available at KFC locations
nationwide through February 2. And KFC is offering more ways than ever for customers to enjoy
this crispy, crunchy variety -- expanding on snack, lunch and dinner options by offering Extra
Crispy Boneless in a Go Cup, 2-piece Combo or as part of a 10-piece Favorites Bucket.

48

Training/Support
A complete 8 week KFC training program is required covering basic brand training, leading a
shift and leading a restaurant. The training incorporates online training modules with hands on
practice with a certified training manager in a training restaurant. YUM! University offers a
complete curriculum of management and leadership courses for you and your team. Performance
Improvement Program and support are offered by each of the brands.
Qualifications
$1.5 million net worth and $750,000 in liquid assets. Passion for operations excellence and team
building. Must have a vision for multi-unit restaurant ownership and the financial wherewithal to
bring the vision to reality.

KFC Corp.

Products & Services: Chicken

Number of Locations: 18,875
Total Investment: $1.3M - $2.5M
Founded: 1930
Began Franchising: 1952

About KFC Corp.

In 1930, Harland Sanders opened Sanders Court & Cafe in the front room of a gas station in Corbin,
Kentucky. He was named an honorary Kentucky Colonel in 1936 for his contributions to local cuisine.
Colonel Sanders began franchising in 1952 and awarded the first franchise to Pete Harman in Salt Lake
City, Utah. Their handshake agreement stipulated that the corporation would receive a royalty of one
nickel for each chicken Harman sold.

His recipe is still a secret, but billions of Colonel Sanders' chicken dinners are served annually in
more than 80 countries. KFC is now part of Yum! Brands, which also includes A&W
Restaurants, Long John Silver's, Pizza Hut and Taco Bell.

Franchise Units
Year

U.S.

Canadian

International

Company Owned

2014

4,285

9,561

5,029

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2013

4,381

9,158

4,659

2012

4,321

8,710

4,370

2011

4,275

8,353

4,225

2010

4,307

7,676

4,281

Where Seeking Franchisees: Franchisor is seeking new franchise units worldwide.

Startup Costs, Ongoing Fees and Financing
Total Investment: $1,262,800 - $2,543,000
Franchise Fee: $45,000
Ongoing Royalty Fee: 5%
Term of Franchise Agreement: 20 years, renewable
Financial Requirements
Net Worth: $1,500,000
Liquid Cash Available: $750,000

Franchise Ranking History

Franchise 500: #14 (2014), #15 (2013), #17 (2012), #16 (2011), #24 (2010),
Fastest-Growing: #43 (2014), #51 (2013),
America's Top Global: #8 (2014), #6 (2013), #16 (2012), #14 (2011), #19 (2010),

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Our Team
Were proud that KFCs people are as exciting and diverse as our product offerings, as its our
team that make us the company we are today.
We believe in building a team of people with different backgrounds, distinct experiences and
unique points of view. That way, we can better understand how to exceed the expectations of
everyone we work with.
TESTIMONIALS
EWACHE SIMON:
It is a breath-taking EXPERIENCE joining KFC as a shift manager. Now I have grown to become a
Restaurant General Manager within a space of 2years. It has been a great remarkable experience. To
KFC Nigeria, keep building the capabilities of your staff, you are so so GOOD!
MARK C. GIDEON:
Its been a great experience working with an international brand as KFC. I never experienced such
working in different previous organisations. It is a remarkable time working with this great brand. I
started as a team member and I have now become a shift manager. KFC So good!
ALAO ISRAEL:
Its quite interesting I must say for being part of KFC Nigeria. I joined this great team as an ARM
(Assistant Restaurant Manager) and was part of the pioneer team learning within 2 years of stay in KFC.
Now I have been promoted to the position of an RGM (Restaurant General Manager). More importantly,
I am glad to be a part of this great success.
AWODIYA ROTIMI:
My experience so far after joining KFC has been wonderful. I joined as a team member and was able to
scale through sectional training. I aspire to become a Shift Manager in the nearest future. This will
motivate me to work harder. I am very happy working with KFC.

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Careers
We, at KFC Nigeria, the fastest growing Food Retail Brand in the country and one of the most popular
Food Brands in the world, are always on a look out for Young, Enthusiastic, Motivated and Focused
individuals who are willing to make it LARGE in life.
We do not believe in offering jobs but CAREERS instead and that is why our selection process carefully
screens every candidate in order to assess their attitude and potential to become future managers.
Our Individual Development Plan, designed for each position, with the help of a systematic learning
approach, smoothly steers our employees from one level to another.
Some of our Team Members progress to Shift Manager Position in just 40 weeks!!!!
In order to understand our culture of HOW WE WIN TOGETHER, please click here to read through the
testimonials of our team who believed in us and are going places.

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PRODUCT:
Product planning:
Their product is classified as consumer product as it has no intermediates. It also offers specialty
goods. The stock turn over of KFC is relatively high. The prices and quality of the product is
always compared. Their product includes Goods (Burgers, Chicky Meals etc) and Services
(cleanliness, quick service, parties, and meetings).
Product Strategy:
It was launched here as an innovative product. KFC has got one product line but later they
introduced products in the same line to protect their market share. New product ideas are
generated from:
Customer services (comments cards)
Gallops survey (mystery shoppers)
They have a Quality Assurance department that decides the new product innovation. Q.A.
department prepares screening of new ideas and products feasibility report. This department
does the technical evaluation (whether it is practical to produce the new product or not). The
products are tested externally by offering trials to customers by giving them free samples. KFC
uses telemarketing, print media, billboards and most recently televised marketing for promotion.
KFC adds a new product in its present assortment based on their competitors, products adequate
demand, the satisfaction of key financial criteria and its compatibility with environmental
standards.
Product Line:
KFC product line includes all chicken based products.
Burgers:
The burger category includes the Zinger Burger, Colonels Chicken Burger, Colonels Fillet
Burger, SUB60 and 80, and Zinger Jr. They have also introduces a Fish zinger burger.
Chicken Pieces:
The chicken involved the product line with different number of chicken pieces like 1 piece, 2
pieces, 5 pieces and 10 pieces chicken.
Combos:
The combo includes the different meal as Chicken Meals, Sandwich Meals and Family Meals.
Desserts & Beverages:
The desserts and beverages offered by KFC are Fruit Salad, Regular & Large Drink, Regular &
Large Mineral Water, Tea, Scoop of Walls Ice cream and Coffee.
Snacks & Side Orders:
The snacks and side orders served by the KFC are Arabian Rice, 5 & 10 Pieces Hot wings,
Dinner Roll, Regular & Large Fries, Hot Shots, and Corn on the Cob, Hot & Crispy Soup and the
Cole Slaw.
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Product Mix strategies:

The product mix strategies are in relation to:
Competitors:
KFC has a head-on competition with McDonalds so wherever they place their products; KFC
goes there as well. Locally in Pakistan KFC face a close competition with the local brands like
AFC (Al-Baik Fried Chicken), Fried Chicks, Dixy Chicks etc which are producing more or less
the same product as KFC.
Attributes:
The brand KFC is so strong that it is the attribute itself.
Quality:
KFC products are based on high quality and prices.
Product Mix Expansion and Contraction:
KFC keeps on modifying their product through line extension and other methodologies. Line
Extension is being done through introducing new meals offers. The alteration of existing
products is also done and this function is performed by the Quality Assurance department. The
department decides which product should be sold and when (seasonal products as rice and soups
offered in winters). Functional modification is also done by the Q.A. department to introduce
new recipes. Other than expansion contraction is also being dealt with as when the new deals or
offers are not sold as expected, Q.A. department contracts the previous offers and introduces new
offers.
Change in Product Positioning:
KFC products were first offered to upper socio-economic group. Later, introducing discounted
and lower price deals, they are now dealing in masses. So, KFC has traded down. In doing so
KFC has used the same brand name and same high quality product.

Product Branding, Packaging and Labeling:

Brand Name: KFC
Color: Red, white
Symbol: Colonel Harland Sanders picture and KFC written with it.
Master Brand: The brand itself is so dominant, that it immediately comes in mind.
KFC Brand:
KFC's brand identity is the logo featuring Colonel Harland Sanders, one of the best-recognized
icons in the world. It is trademarked registered brand and is distinctive, adaptable to addition to
product line. It suggests something about product. It is legally protected and registered.

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Brand Equity and Strategy:

The brand equity is very high as the value added by brand to the product effects the product
selling. And the Brand strategy followed is that the KFC is marketing the entire output under
products own brand. Pepsi and Nescafe are the complementary brands associated with KFC.
Packaging Strategy:
KFC makes its own disposable packaging. If they need promotion Pepsi contributes in improving
the packaging quality. KFC does family packaging. They use paper material for packaging to
avoid health hazards and environmental pollution.

Labeling:
KFC does brand labeling. Some of its products also have informational labels such as Halal,
Veggie Burgers and Chicky Meals.
PRICE:
In introduction stage KFC entered the market using market-skimming strategy. Their products
were high price and targeted only upper class. Gradually they trickle down focusing on the
middle class to penetrate the market. Also KFC follows one price strategy. Price is determined
according to the rates of the raw materials and policies of the Govt. The political and legal forces
often affect the policies of KFC and eventually results in change of prices that is due to imposing
of taxes.
PLACE:
Distribution Channel:
KFC has only one channel of distribution i.e. direct where the goods are transferred to the
consumer directly. KFC has no middlemen.
Distribution of Consumer Goods and Services:
KFC does distribution of consumer goods directly to the consumer. It also does distribution
of services to the consumer like parking, sitting, home delivery, etc. KFC does intensive
distribution on its outlets. (All and everything on every outlet).
KFC gets Wheels!
KFC launched its first mobile unit, which took the streets of Karachi by storm. The mobile
unit has been designed to cater to the needs of those who are on the go, and have little time
to stop by at a restaurant. It also provides a unique convenience of enjoying the delicious
KFC offering anytime, anywhere, thus making fast food truly fast and convenient.
It intends to further develop its mobile network nationwide through more such units.

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PROMOTION:
The logo features Colonel Harland Sanders that is one of the best logo in the world has created
its name as a standard in the market. Today the Colonels Spirit and heritage are reflected in
KFCs brand identity.
KFC by its advertisements derives the desire in the customer to come and enjoy healthy food in
their favorite restaurant. They spend 2% of its profits on advertisement. They use print media
and most recently doing televised marketing to promote it products. Their advertising media
involve: Newspapers, Pamphlets, Billboards and Television. KFC does both the primary demand
advertising (Become a Chicken Fanatic) and the selective demand advertising (e.g. Zinger
Meal). In its advertising it give informative messages like Keep the city Clean. KFC does
institutional advertising to stimulate demand. When KFC offers new products then it does
product advertising. KFCs ads act as counteracts which means to drive the customer to KFC
i.e. it uses pull advertising strategy. They also provide wit the key chains, watches, bags, teeshirts etc. to its customers with the purchase of different meals as a part of their promotional
activities. They also provide with certain midnight packages, birthday packages and lot more.
KFC has put big hoardings on the busy areas of Pakistan and have an effective advertisement
campaign on the media in order to motivate its customers. The colors used in advertising are
Red, White and blue which itself is recognition for the brand.
KFC have joint sale promotions with different companies like HP, Philips, Value Meals, PepsiCola. And most recently with ARY Gold digital and World Call Internet services. Also KFC
Proud Partners are Del Monte, Culligan, Shan and Peek Freans (EBM).
PSO had made a scheme in which PSO had given the coupons of KFC having 10% off. (1
coupon was given after each purchase of 10 liters of petrol)

KFC in its advertisements says;

Nobody does chicken like KFC
We do chicken right

Hence, focuses on product advertising. KFC does mass selling in order to reach its target market
(as it has trickle down). KFC in its ads try to convert people to people who eat boring bland fast
food over to KFC.
The message conveyed in the ads is recognition for the brand. KFC does competitive
advertisement with its head on competition with McDonalds. Regarding this KFC uses Pricing
below competition strategy.
KFC sponsors many NGOs and other social welfare organizations. They also offer different
deals according to the season and occasions.
KFC as a market leader:
It has covered 80% of the market share in fast food industry KFC has recognition around the
world and has been globally positioned for many years in Pakistan and to capture the market
56

share in Pakistan adopts champs philosophy.

Strategic Planning is the process of developing and maintaining a strategic fit between the
organizational goals, capabilities and its changing marketing opportunities and is done by KFC
in a well defined manner.
Strategic planning sets the stage for the rest of the planning in the firm. KFC is looking that how
much its current strategies are beneficial for them. Although these are good and profitable but
dynamic changes in environment are requiring identifying the attractive
Opportunities.
That is the reason that they are expanding there market size by focusing on sub urban areas and
targeting middle class people by providing them differentiated products at a fair price. They are
opening their new mobile outlets in there potent ional markets. KFC is also going to increase its
sweet dishes to avail the opportunity available for them.
KFC in a Growing Market:
The market of KFC is increasing day by day. Being a food market it is always considered in a
growing market because it increases continually with the population. Their growth is
continuously increasing and if they want to be a leader, they has to develop a strategy which is
predominantly a market expansion strategy and in this way they will not loose their leadership. It
has greatly increased their market share in Pakistan by following different strategies that may be
regarding their products, prices, placement or promotions. They have been following the
strategies for market expansion by targeting the new users of the product, describing the new
uses of the product and by showing them more usage of the product.

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Describing the New Uses:

In this method, the new uses of the product are being described. As the motto of KFC says we
do chicken right, here they claims that they are the best in using the chicken correctly. In the
early days the chicken was simply used in a simple way for cooking, but KFC has introduced it
in a number of ways and described it to the people by launching it as a meal as well as in the
snacks form. They prove them with the best cooked chicken with a great taste. Instead of the
chicken pieces, they also serve chicken nuggets, burgers, hot shots, twisters etc. many new
innovative products are being introduced by KFC that is greatly helpful in attracting the
customers and increasing its market share.
More Usage:
In the advertisement of KFC mostly seen on the bill boards, they have shown in the new scheme
of zinger deal of Rs.290 + 10 and u get zinger + another chicken burger. And in Ramadan, they
launches the deal of Rs. 500 and it says that all you can eat, it gives the unlimited zinger burgers
and chicken pieces. In this way they have greatly increased their usage of their products.
New Users:
The people who do not eat KFC should be attracted, that may be by attracting the non users of
the product, non users of the brand or the non believers. They are done in the following ways.
Non users:
The people who do not eat the fast food, they should be attracted like KFC has been attracting
their customers by providing deals with Ufone. If the person is an Ufone user and he is not a
KFC customer, they simply receive a message on their hand set and they jus have to show it on
the KFC and counter and get a free meal. Its a strategy to attract the non users. In a similar way,
distributing deal coupon on specific purchases, in shopping malls may also be very effective.
Non Users of the Brand:
The non users of KFC can be attracted by describing them the quality features of the product that
they think of trying the product once. In this case promotional activities play an important role. If
the promotions are done in an effective manner, people would definitely try the product and also
lowering the prices may be very effective that people may switch from other brands to KFC.
Non Believers:
KFC is quite successful in attracting the non users of the product and the brand as well, so it is
not really necessary to hit the non believers. This is because they are the most difficult people as
it is very hard to break their social, religious and cultural believes.

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SWOT ANALYSIS:
The swot analysis includes the strengths, weaknesses, opportunities and threats faced by KFC in
Pakistan. These all are described in detail as under:
Strengths:
It is the oldest and finest in Business having a high Goodwill. It does not have any Core
competitor in chicken serving. They have a large Number of Outlets at prime locations in
Pakistan. They serves variety of items under single menu. They are successful in maintaining
their loyal customers. It has an incentive of being a Multinational Organization e.g. economies of
scale, government incentives etc.
Weaknesses:
business activities are being carried out. KFC has handled this situation Its major weakness id

the presence of Multinational competitors in the market e.g. McDonalds(specialized not in

chicken serving but in burgers) and the other weakness faced by KFC is the imported raw
material which usually rise their prime cost.
Opportunities:
The opportunities are the cheap and easy availability of labor. The increase consumption of fast
food has increased the market size of KFC. As the consumer usually prefer All under one roof,
therefore, in order to increase their sales turnover they can increase or add the served items.
Threats:
The threats faced by KFC are the entrance of many new competitors into the market that may be
local or international brands. And being in Pakistan, there is high political instability/uncertainty
involved.
PEST ANALYSIS:
The Pest Analysis includes the political, economical, socio-culture and technological factors.
These are described in detail as under:
Political Factors:
The political factors includes the government policies as KFC being a foreign company, but they
have to obey the policies of the Government laid by the government of Pakistan, the country
where the very tactfully and has obeyed the policies of the Government as prescribe by the
government in order to run this kind of business. The other major factor is the pricing policies.
KFC maintain & design its price policies keeping in view the income & income distribution of
the people living in the country. Thats why all the classes are the target market of KFC. And the
most important factor is the political instability. As in Pakistan, there are political crises faced by
the government, these greatly affect the business of KFC.
Economical Factors:
The economic factors includes the income of the people, KFC is going to target. Income is an
important economical factor of the KFC. This factor decides which class KFC is going to target.
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In the early time of KFC, they were focusing on the upper class but they after some time changed
their strategies and started to target the mass market by introducing some different kinds of
meals and offers through which we can say that they target the middle & the upper level as well.
The consumption behavior of the people plays an important role. KFC also estimated the
consumption behavior of the people, their liking and disliking and make decision accordingly.
Payment method is an important factor in the economical factor of the KFC. They check the
behavior of the regarding the payment methods of the people. They check whether the gives
money in the form of cash or plastic money.
Socio-culture Factors:
The Social/Cultural Factors includes the Social Class, as it is discussed earlier that KFC target all
the class including the upper class, upper middle and lower middle class etc. Although the
culture of KFC from where they come is entirely different but they have adopted the Pakistani
culture as they had to serve the people living in Pakistan having entirely different culture from
other areas. And it has not only adopted the Pakistani culture but also the Religion as well. They
offer Halal foods to the customers, which is the symbol that they adopted the Muslim religion
strategies as they had to serve in the Muslim country, to the Muslim customers.
Technological Factors:
The technological factors include the Pace of change at a fast level.
Pace of change mean rate of change. KFC has strategy to introduce new technology whenever
they think that it is a time to introduce new technology. Research & Development is also an
important factor in the Technological factor. KFC always support the work of research &
development in order to introduce the new technology. Capital formation means stock of
machinery. KFC has a stock of machinery in order to run its business activities. In other words
KFC has a good amount of Capital Formation.

60

Recommendations:
KFC is a market leader in providing Fried chicken. As KFC, so it is competing with the
prominent market signs like pizza hut, McDonalds. N its product category, it is doing really well
but they need improvements in their hot menu. They should also make their menu dynamic, by
introducing new meals after certain period of time. New items should be introduced by varying
the taste. They should also try the local desi taste addressing the desi food lovers, thus it will help
to increase their market share.
The prices of KFC are reasonable as compared with other fast food restaurants. But as price is
always a primary concern for the customer, therefore, they should adopt certain strategy to attract
the customers. And it can only be done by lowering the prices. It could be by introducing some
discount packages for families, employees, students or regular customers. The membership card
can be used to provide certain extra value to the customer.
AS far as placement of the products is concerned, it is an important factor, for a company to
increase its market share, by targeting the right customer. KFC needs to have more outlets, at
commercial areas. It will help to target the actual as well as the potential customers. Mobile
outlets may be an effective addition as well.
KFC has large customer equity, but being a market symbol, a company should strive for having
more actual customers. KFC should work for having more solid marketing departments. They
should organize and run the proper advertisement campaign. It would definitely be an
incremental factor for their sales. They can also use the brand promotions. They can set up the
promotional campaigns. All they need is an effective marketing department to facilitate t he
promotional activities.

61

Conclusion:
KFC is a very strong chain of fast food restaurants with more than 10,000 restaurants all over the
world. KFC is providing employment to 1200 Pakistanis an around 6000 Pakistanis dependent
on KFC. They are paying Rs. 10 million to government of Pakistan as direct taxes. 95% of its
food and packaging material used in KFC produced in Pakistan locally which sums up to the
purchase of 35 million per month. Each new outlet developed by KFC in Pakistan spends 40
million rupees, thats a massive amount for this industry.
From all of the above detailed discussion about KFC in Pakistan, it is really clear that KFC and
Pakistan are growing together. KFC is doing well in Pakistan and keeps following its marketing
strategies as a market leader and segmenting the market into different variables and increasing
their market share. KFC is leading in Fried Chicken. It gives quality, variety and fresh meals as
of its competitors.

62

BIBLIOGRAPHY
Reference Books, Journals, Newspapers, Websites, Reports, etc are to be listed out here.
Examples as how to write are given below:
Books:
Kotler Philips, Marketing Management : Analysis, Planning Implementation & Control 9th
Edition 1998, Prentice Hall of India Ltd., New Delhi
Magazines, Journals & Newspapers:
Name of article - Business Today, 15 22 May, 2007
Name of article - The Times of India, Mumbai, 21st
Internet:
www.webindia.com
www.crm.com/papers/php.html

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