KFC History I
1939 First restaurant was founded by Colonel Harland D. Spencer (Corbin/Kentucky)
1952 First franchisee in Salt Lake City
1952 Sanders sells restaurant in Corbin/ first international franchisee in Canada
1969 KFC listed on the NY Stock Exchange
1980 Colonel Sanders dies (c) 2005 David Nerici
KFC History II
1982 KFC becomes a subsidiary of R.J. Reynolds Industries
1986 KFC becomes a subsidiary of Pepsi Co, Inc. for $ 840 mio.
1987 KFC opens first restaurant in China
1991 A new logo is introduced
1995 KFC opens its 9,000th restaurant
(c) 2005 David Nerici
KFC – Current situation
Turnover (worldwide): 11.2 $ billion (9.35 € billion)
KFC is part of (Pizza Hut, Taco Bell / 45.9 % market share worldwide)
KFC europe: - 985 stores (29 countries) - 647 UK / 47 Germany
(c) 2005 David Nerici
KFC AustriaKFC has already tried to get into the austrian market (80`s)
KFC aims to achieve (over the next 10 yrs.):
- € 100 million turnover
- 45 restaurants
- 20 % market share
KFC opens its first restaurant in may (millenium city)
(c) 2005 David Nerici
Strengths 1
Products:
High quality standards: C.H.A.M.P.-concept
Secret recipe: blend of 11 herbs and spices
Pressure cooker
Variety of menu items (lower calorie choices, meals for vegetarians,…)
(c) 2005 David Nerici
Strengths 2
Company:
Largest chicken fast food supplier in the world
Colonel Sanders was the first quick restaurant pioneer - “Sunday Meal, seven days a week”
Capital and expertise
(c) 2005 David Nerici
Weaknesses
Already failed once in Austria
Little differentiation from Mc Donald’s and Burger King
Competition – especially Mc Donald’s
Distribution
Narrow product range
(c) 2005 David Nerici
Opportunities
Fast Food market in Austria is growing – more accepted
People travel more and know KFC from abroad
Failures are not noticed by the population – KFC can start from the beginning on
KFC can work out a strong USP
Compared to other countries Austria has few Fast Food Chains
(c) 2005 David Nerici
Threats
KFC has established competitors in Austrian market
Image has to be upgraded
With low investment: KFC could fail again!
With high investment: stronger chances to succeed but if failure big losses
(c) 2005 David Nerici
Strategy - Introduction
For all alternatives it is of high importance to stress out the USP in order to have a differentiation from other fast food chains and especially from Wienerwald and Mc Donalds( KFC has failed in Austria before)
(c) 2005 David Nerici
Alternative 1Extremly high financial investment
Distribution: a high number of KFC restaurants in Vienna = test market (expansion to other places in Austria later on) shopping centers and central locations, but also in the outer districts of Vienna and drive-throughs
Promotion: very intensive promotion strategy, events in KFC stores
Price: about the same as Mc Donalds and Wienerwald, definitely not higher!
Target group: everybody who likes chicken(c) 2005 David Nerici
Special offers: like Mc Donalds offering „special weeks“
Goal: „being everywhere“ (Burger King did the mistake of being to slow in the introduction, has very few locations)
Differentiation to Mc Donalds: offering totally different food, better personnel
Differentiation to Wienerwald: having the image of being a „high quality fast food chain“ Wienerwald has the image of a „cheap restaurant“
Alternative 1Extremly high financial investment
(c) 2005 David Nerici
Alternative 2 Health line
Promotion and Distribution same as in alternative 1
Using the advantage of chicken as being the healthies meet
Offering also vegetarian products
Price: the same or a little bit above Mc Donalds and Wienerwald (food has to be very fresh and carefully prepared, this requires higher financial investment)
(c) 2005 David Nerici
Promotion: same strenght as in alternative 1 but focusing also on health advantage
Target group: focused less on children than on people from 14 up who like chicken and are health concious
Differentiation to Mc Donalds and Wienerwald is very strong because of the “health factor”
But: Nordsee offers “healthy fast food” differentiation: KFC has younger and trendier image
Alternative 2 Health line
(c) 2005 David Nerici
Alternative 3 Cost saving method
Distribution: instead of normal-sized restaurants like Mc Donalds satellite restaurants at train stations, in hospitals (AKH), universities, shopping center, airport… (similar to “Würstelstand”)
Offering just simplified products
cost saving introduction with low image factor
Target group: only really fast food junkies
Price: cheaper than Mc Donalds and Wienerwald(c) 2005 David Nerici