KFC’S

GLOBAL
STRATEGY
Instructor: Miss Hoàng Thị Quế Hương
and Miss Trần Mỹ Linh
Class: 231KD0303
Group perform: LOGINATOR
 LOGINATOR’s members

Trần Huỳnh Quang Huy Lê Hoàng Băng Trinh Trần Nguyễn Thiên Phú
K214020124 K214020165 K214020140

Trần Quốc Hưng Phạm Ngọc Trí Nhân

K214020125 K214020137
Table of Content
01 Introduction of the local firm

02
The industry’s level of
globalization

03
The global strategic direction
of KFC

04 Operations in Vietnam

05
Recommendations to solve
KFC's problems.
1. Introduction of the local firm.
[Link] information and business
model strategy.
KFC holds a prominent position in the fast-food industry,
with a presence in over 145 countries and an extensive
network of 25,000 outlets, earning it the rank of the third-
largest global fast-food chain. It was one of the 1st American
fast-food chains to venture into international markets. As of
2023, the brand boasts a substantial estimated brand value
of approximately $17,662 million.
 1.1.1. Business model of KFC 1.1.3. KFC’s key Partners
KFC’s management cannot oversee all Franchise Partners
the operations of its outlets over the Suppliers and Vendors
world by sitting in one city. Thus, KFC Marketing Partners
adopted the Franchise Model as its Delivery and Distribution Partners
Business Model just like the other fast-
food restaurant joint did.

1.1.2. KFC’s Value Proposition 1.1.4. Business model of KFC-

High-quality food
channels
Prices KFC primarily caters to its customer base
Ambiance and staff through a vast network consisting of over
Variety of options 25,000 outlets strategically located
Brand name and loyalty worldwide.
In addition to this, KFC offers the
convenience of online ordering through
their website or app.

1.2. Product.
KFC's core product offering is pressure fried on-the-bone chicken pieces seasoned with Colonel Harland Sanders' "Original Recipe" of 11
herbs and spices.
McCormick & Company is KFC's largest supplier of sauces, seasonings and marinades and is a long-term partner in new product
development.
2. The industry’s level of globalization.
2.1. Pressures for cost reduction: Low
The KFC industry is characterized by a high degree of standardization and
economies of scale.
Economies of scale
Global sourcing
Standardization

2.2. Pressures for localization: High

Despite the pressures for cost reduction, there are also strong pressures for
KFC to localize its operations. This is because KFC's customers have
different tastes and preferences in different countries.
Cultural differences
Regulatory differences
Political differences
2.3. Balancing the pressures for cost
reduction and localization
KFC must carefully balance the pressures for cost reduction and localization
in order to be successful.
KFC has a number of strategies for balancing the pressures for cost
reduction and localization.
The KFC industry is likely to continue to globalize in the future.

Overall, the KFC industry is characterized by a moderate level of globalization.

There are pressures for both cost reduction and localization, and KFC must
strike a balance between the two.

On the overview of the business model of KFC, we

can clearly see that the company utilized its
business model very well and has been growing at a
wide range.
 3. The global strategic direction of the firm.
3.1. Pressures for Cost Reductions
1. Chicken has become a 3. Facing with major local
global demand competitors located in
low-cost locations
With it being a source of protein that
is affordable and easy to prepare. Labor costs
Moreover, with its secret recipe and Real estate costs
strong brand, KFC fried chicken has Supply chain costs
become a global demand. Regulatory compliance costs
Pressure for maintaining product
and service quality with an
affordable price

2. Excess capacity when 4. Powerful customer and low

entering new markets switching cost

Fixed cost burden Price - competitive customer

Pricing pressure Many copetitors which means
Reduced efficiency customers have high bargaining
Inventory management power
Customer loyal to local brand
Have access to information about
prices and services leads to more
choices
3.2. Pressure for local responsiveness.
Each country and territory has its own culinary culture and unique social
factors, and these factors create the characteristics of consumers in that
area:
Rising consumer expectations: Consumers are increasingly
demanding products and services that are tailored to their local needs
and preferences.
Growing competition: increasing competition from both local and
international chains.
Changing consumer demographics: The global consumer base is
becoming more diverse, with a growing number of consumers from
emerging markets. These consumers have different tastes and
preferences than consumers in developed markets.
Therefore, KFC must ensure its operations. its operations comply with local
laws and adapt its business model to local market structures and consumer
behavior
3.3. KFC’s international strategy.
The main method by which KFC penetrates worldwide is a
mix between franchising, joint ventures and localization. KFC
franchise with consistent global store chains but with
American-style fast food mixed in flavors, a special menu list
with bold flavors is of the local hometown where KFC is
present.
KFC is also one of the world's most famous franchising
companies with a series of strict standards to build
consistent and quality restaurant chains. With 145 countries
and territories around the world - each country with KFC has
a localized menu that caters primarily to unique local tastes
and preferences. Moreover, KFC's marketing campaigns are
tailored to local audiences, using language, imagery, local
celebrities and influencers to reach a wider audience.
 3.3. KFC’s international strategy.

Beijing chicken wrap Vegitarian menu

4. Operations in Vietnam.
4.1. R&D.
Target market selection: Because of KFC's market
targeting young people, the Vietnamese market is
considered a promising market.
=> 17 restaurants compared to more than 34 restaurants
in the KFC chain worldwide.

Market Research:
+ Market Segmentation by Geography
+ Demographic Segmentation
+ Segmentation by psychology and consumer behavior

R&D planning: focus on improving new products,

improving existing products and apply new
technologies in KFC production.
 Improving Improving new Applying new
existing products products technologies
Diversifies KFC Updating number of 3D printing technology
products, creating an additional dishes to Robot technology
extremely rich menu serve KFC food that suit Developing a mobile
Updating newest KFC Vietnam tastes application system
dishes continously Differentiate themselves
Investing new healthy from other products by
frying oil mixing 11 different
spices,
 4.2. Marketing.
KFC's Marketing 4P Mix Strategy: "Localization" is a great success

Product-East and West (Price) - Minimalist to suit

combine perfectly Vietnamese spending
KFC still maintains its traditional products of Using low prices to make customers more
original fried chicken and hamburgers. In familiar with the brand.
addition, the brand also innovates many Make promotional programs and special
unique dishes to meet the tastes and eating prices for VIP card members.
customs of Vietnamese consumers.

Place - Success with Promotion - Strong

distribution channel advertising on the media
Choosing Ho Chi Minh City as its first Presenting in all forms of media such as
destination in the Vietnamese market. television, billboards and online advertising.
Operated its stores in airy locations with Built a two-way communication channel.
large spaces and eye-catching. To date, KFC Make impressive campaigns, slogans to
has expanded its presence in 21 cities in improve brand value.
Vietnam.
4.3. Production.
The production layout method of KFC production process is group layout:
 Chicken Processing Area:

Burger processing area:

4.4. HRM.
Organizational structure:
KFC in Vietnam operates under the franchise method, managed by a regional director > management under
> customer service team.

=> The company's organizational structure according to departments and decentralized groups.

Besides, KFC's HRM activities also need to have such as: Forecasting human resource needs, Forecasting resource
supply, Recruitment strategy
4.5. KFC's supply chain.
Supply chain model of KFC.

Analysis of KFC's supply chain model indicates that

core suppliers can be classified into two categories.
Type 1 is providing processed products such as chili
sauce, sauce. Category 2 mainly provides fresh,
unprocessed foods such as chicken, beef, and potatoes.

Supply chain management

Supplier
Quantity and Time
Usage Cost Management

How to manage

KFC builds a sustainable supply chain by using

Distribution Resource Planning (DRP)
 5. Recommendations to solve KFC's problems.

5.1. Adjustments in the global 5.2. Digital 5.3. Improve product

management structure. transformation. healthiness.
KFC should have a combination of Especially for multinational companies KFC should take advantage of raw
centralized and decentralized like KFC, there is a need for clarity and materials available in agricultural
organizational structure in its digital transparency of information on the countries, such as vegetable oil, a type of
transformation process. management system. natural fat that has health benefits, or
Big data also helps KFC identify useful frying techniques at the right
information for administrators to make temperature to help Limit substances
effective decisions. that are not good for health.
 5. Recommendations to solve KFC's problems.

5.4. Promote competitive 5.5. Plan to stabilize the 5.6. Overcome

advantage. supply of raw materials. advertising restrictions.
KFC, in addition to product improvements, Due to example in the UK, this is also a KFC needs to make smart choices and
also needs to have campaigns to enhance lesson for KFC about the need to careful consideration when implementing
its reputation to boost market share and stabilize the supply of raw materials promotional campaigns and different
gain a certain position in the hearts of with specific plans, in addition they types of advertising for its brand as it is a
consumers. need to have alternative options to multinational enterprise doing business
prevent risks. in many countries. different cultures.
References
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from End-to-End <[Link]
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proposition-canvas>
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<[Link]
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<[Link]
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<[Link]
8B2BEEC8F2FBFA741DC1D4037DE20D19?sequence=1>
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<[Link]
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-at-kfc/>
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<[Link]
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[Link]>
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<[Link]
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