Strategic Choices

KFC Strategic Plan OUTLINE

The Mission Statement

• To utilize the available markets and to maximize profitability, improve the value of shareholders in delivering sustainable growth across the year.

Vision statement

• To focus in services by providing consistent quality products and excellent customers and take lead in the integrated food services

Objectives

1. To upsurge the share percentage in the fast-food market by establishing a competitive workforce
2. To increase the profitability margins of the company every year to continue funding the company
3. To give back the investment profits to investors and franchisees
4. To ensure that quality food is provided consistently
5. To dominate the market by promoting a dynamic and positive experience of the customers

Industry analysis

• Current status of Fast foods industry
• Revenue realized
• History of KFC
• The current status of the KFC firm

The SWOT Analysis

Strengths

• Market operations: KFC has different outlets in different countries. This has led it to develop and grow tremendously
• KFC offers different kinds of foods both veg and non-veg to satisfy different customers
• The company has a trade secret that has enabled it to grow
• High management skills to reach all the outlets

Weaknesses

• Negative publicity on consumption of unhealthy foods
• Leadership skills due to diversity and large market base
• Quality of the food due to GMOs

Opportunities

• Growth and expansion in other countries
• Chance to provide healthy food
• Reinforcement of outlet network

Threats

• High competition in the market
• Change of eating habits and consumer preference
• Cost of establishing new outlets in other states
• Risk of economic and political instabilities

Perceptual Map

• Quality versus price
• Taste vs nutritious value

 

 

 

 

Strategic Plan for Kentucky Fried Chicken (KFC)FINAL

The Mission Statement

To utilize the available markets and to maximize profitability, improve the value of shareholders in delivering sustainable growth across the year.

Vision statement

To focus in services by providing consistent quality products and excellent customers and take lead in the integrated food services

Objectives

1. To upsurge the share percentage in the fast-food market by establishing a competitive workforce
2. To increase the profitability margins of the company every year to continue funding the company
3. To give back the investment profits to investors and franchisees
4. To ensure that quality food is provided consistently
5. To dominate the market by promoting a dynamic and positive experience of the customers

Industry Analysis

History of KFC

KFC is among the largest food chains in the U.S. and across the globe and was the first to expand globally. The company has more than forty thousand outlets in the world, both for owned companies and franchises. KFC has faced different mergers and acquisitions with various corporations where the latest is PepsiCo, Inc., and is the most preferred in the U.S. (Ali, Bangsawan&Rouly, 2020). Colonel Sanders, born in Henryville, founded KFC. He began selling chicken dishes and later converted it to a full-time business in a restaurant and bought a motel. It got burned and rebuilt it which he later decided to do a franchise of the restaurant. Sander’s recipe was first rejected but later attracted many customers.

His recipe’s secret was coined in the name “Kentucky Fried Chicken,” hitting hard in the market (Nguyen, Nguyen & Do, 2019). Sanders got a tough competitor who forced him to sell the restaurant and resolved to pursue the dream to spread KFC franchises and hired employees across the country. KFC grew and hit big gaining international market, but after hitting setbacks, resorted to selling the company at 2Million, which is equivalent to 15 million dollars today (Ali, Bangsawan&Rouly, 2020). Until today, Sander appears in the logo and remains a crucial person in branding KFC. His appearance represents delicious fried chicken, which is consumed across the world. When Sanders died, the business had been located in 48 states. Today KFC has reached many countries in the whole world.

The Food Industry

The current revenue of food and beverage is projected to be US$ 15,409M in 2020. The annual growth rate is 7.9% and results in a projected market of “US$20,898m in 2024. The current user penetration of 30.1% in 2020 should hit 39.2% in 2024. Average user revenue is also expected to rise to US$154.65 (Ali, Bangsawan&Rouly, 2020). According to Statista, China would generate the highest revenue by 2020 of US#152,445M. According to the National Restaurant Association, fast foods have been increasing in the sale, contributing to the most increased revenue production in the industry. The fast-food in the foodservice industry has six significant segments. Some of the fast-food outlets include chicken Chains, sandwich Chains, Pizza Chains, family restaurants, dinner houses, and steak restaurants.

KFC Firm

The firm keeps on growing as it is owned by different owners such as Heublein, who produces beverages and is currently owned by PepsiCo, who owns the Taco Bell Food operation”. KFC provides the highest Pepsi products, which helps to drive KFC’s goals through financial strength.

PepsiCo has a leading share after acquiring KFC and is ranked among the most desired corporations in the American states. The changes due to globalization make it keep changing their menu. More outlets are required since non-traditional foods are the most demanded. The market targeted by KFC is for both veg and non-veg customers. Although the menu accommodates children and adults for a long time, it wished to be a family restaurant.

The Strategic Analysis

Strategic analysis is based on both internal and external factors. The internal investigation is accessed by the strengths and weaknesses of the organization.

Strengths

KFC is guided by its ability to operate in more than 40,000 outlets globally in approximately 130 countries. The brand has increased in the product line, offering vegetarian and non-vegetarian foods to various top customers (Omer, 2018). The recipe is among the famous trade secret, which involves eleven herbs and spices, helping the business develop and grow. The franchise business model has enabled KFC to grow and expand across the globe. The company allows an environment for expansion in the international markets. The business has helped enactment of the franchise law in Mexico and NAFTA passage in America (Chan et al., 2020). the growth indicates strong and desired management skills with top PepsiCo., Inc., and the organizations invest in training of the employees and quality issues that improve customer experience.

Weaknesses

KFC has negative publicity for providing food unfit for the recommended health of foods such as fries, which has high-fat content and calories (Chan et al., 2020). The issue has affected the industry and leads to decreased sales. Managing the franchises has been a challenge due to maintaining the quality of food. Quality of food is the most critical aspect of food consumption. At times, the suppliers do not supply the expected products, such as hormone-injected chicken, which hampers the brand name and can break the brand’s trust.

External Factors

Opportunities 

KFC keeps on growing in different countries, and it still has a chance to grow and expand from the already existing outlets across the globe. KFC has the opportunity to provide healthier options for their food to the customers and attract and retain their trust. Outlet networks need to be reinforced to support the brand in penetrating other outlets and make the leading food producer and chains.

Threats 

The most significant threat is the increased competition in the market. Many food organizations have come up and raised match to KFC. The management approaches make the company survive in the market. Many customers keep changing their eating habits, tests, and preferences, posing a threat to the industry, resulting in declined sales of KFC products. The increased costs of relocation and opening of new locations in other countries. The sector faces different setbacks and risks associated with political and economic instabilities causing foreign exchange risks.

Perceptual Map

Price v. Quality

Taste vs. Nutritious Value

Market Positioning

I choose positioning or perceptual maps because help in developing market position strategy of KFC. The map shows the customers perception about the product and show the existing products in the market that are competing and help to position well. Firms can choose to fill an existing gap in the map or decide to compete with the existing products.

The example on customer perception on price and quality of KFC represents a view of different brands are differentiated in the market. Identifying the existing products helps to identify the gap and determine how to fix in the market. The criteria on taste and nutritious value is an aspect by consumers as they have the choose the best product according to their taste preference. Therefore, a research is important to enable choose the attributes which are relevant to the consumers to purchase the product. The map may be a challenge because identifying the taste for a particular customer could be a challenge because customers have diverse preferences.