PowerPoint PresentationTitle: PowerPoint Presentation Author: Stephens, James Created Date: 4/3/2012...
Transcript of PowerPoint PresentationTitle: PowerPoint Presentation Author: Stephens, James Created Date: 4/3/2012...
Brands in China
Presented By: Charisse S. Bruin
The Issue
• To establish a nationwide
chain seamlessly in
Chinese culture.
The Issues
• Localization
• Creating a workforce
• Cuisine
Localization
• Important to begin in
mainland China
• Chinese curiosity
• KFC interiors modernized
• Upscale atmosphere
• Native entrees
Establishing a Workforce
• Requirements:
▫ Speak and understand
Chinese
▫ Teachable
▫ Innovative
▫ Fast Food background
• Chinese employees
• Younger workforce
• Training programs
• Competent managers
• Cohesive mindset
What’s for Lunch?
• Generalized menu would
not suffice
• Offered variety
• More localized foods
• Health conscientious
Yum! History
• Started with three of five company from
PepsiCo. (Taco Bell, Kentucky Fried
Chicken and Pizza Hut)
• Based in Louisville, Kentucky
• The Yum! system includes three operating
segments: U.S., International (Yum!
Restaurants International) and China
Division.
Four key business strategies: • Build leading brands across China in every
significant category
• Drive aggressive international expansion
and build strong brands everywhere
• Dramatically improve U.S. brand positions,
consistency and returns
• Drive industry-leading, long-term
shareholder and franchisee value
• Sam Su- chairman of Yum! Brands China
• Based in Shanghai
• Mainland China : Yum! Brands' leading market for new
company restaurant development worldwide
• In 2010, the Company opened more than 500 new
restaurants in mainland China.
• KFC was the first quick service restaurant chain to
enter China in 1987
Yum in China
The Facts: Perspectives
• Experts: See Yum Brands China accounting for 50% of profits by 2015
• Chairman & CEO Yum! China, Sam Su: Aiming for 500+ store opening per year (already succeeded), 20,000 restaurants ultimately
• Consumers: Adapted to Yum primarily because of menu differentiation devoted to Chinese consumers; view restaurants as “restaurants”
Personal Source:
• “Very popular… localized taste for
menus…I know it has more than 500 stores
in China and it grows very fast…Chinese
people will feel
very disappointed if it withdraw from
China.”
Ansoff Model
Present
New
Present Market Penetration: HEAVY, 3,600 restaurants;
Goal 20,000 restaurants
Product Development: Adapt to local taste;
East Dawning
New Market Development: 1 new restaurant opening
EVERYDAY throughout
China;
East Dawning
Diversification: Menus very different than
America Yum menus
Market
Product
Marketing Mix
Product:
KFC, Pizza Hut, East Dawning
Place:
China (all provinces/territories
minus Tibet
Price:
KFC- $3-$5 US
Pizza Hut- $4.25- $7
Promotion:
Ad’s, commercials, LOCATION
SWOT Analysis
Strengths
• Strong reputation
• Diverse
• Has largest chicken
restaurant
Weaknesses
•Overexposure
•Weak R&D
Opportunities
• Expansion
• Innovation
Threats
•Changes in food prices
•Competition
•Changing consumer tastes
Actions
• Buy out competition
• Create new recipes
• Create plan to attract new staff members
• Continue to expand
• More focus on R&D
Consequences
• Oversaturated market
• Unhealthy lifestyle
• Too much preparation
• Can be costly
2011 Update
• Yum's biggest profit driver and accounts for just over 40 percent of overall profits.
• Yum's second-quarter net income rose to $316 million, or 65 cents per share, from $286 million, or 59 cents per share, a year earlier.
• Revenue rose to $2.8 billion from $2.6 billion a year earlier
• Yum overseas strength offset a 4 percent decline in U.S. same-store sales.
Future Growth
• Profit will continue to
increase in China
• Continue to expand
• And more variety on
menus
Take-Away’s A Successful China-fied Operation
Adaption
Taste
Price point
Vast Distribution Network (heavy early investments– location to other cities competition isn’t located
Long- Term Commitment
Right ambience and experience
Operating growth more than 30% each year in the past decade