100%(4)4 out of 4 people found this document helpful
This preview shows page 1 - 4 out of 10 pages.
KFC Radical Approach to ChinaGroup Members:
1. Based on the understanding of the case, discuss some of the objectives that KFC would have set before entering Chinese market.•An objective that KFC would have set before entering the Chinese market would have been to penetrate the market quickly and obtain a national foothold. They achieved this by quickly setting up 16 locations in smaller cities, then rapidly scaling up the number of locations nationally. KFC China wanted to establish the brand as not just western fast-food, but as part of Chinese culture.•They also entered the market with the objective of developing a logistics chain. This is important for a food chain because it helps reduce costs and establishes the product as being made from local fresh foods.•They planned to have the locations be corporation owned instead of the usual franchise so that they could maintain a high level of control over the menu and decor. Pepsi Co at the time was also in fierce competition with Coca Cola, so they enabled the executive team for KFC China to have independence and make the changes they deemed necessary. This helped meet their objective of remaining flexible to meet the various local tastes across the country, thus making their product more appealing.•KFC China also entered the market with the objective of developing a strong relationship with the Government. To achieve this they directly invested into the economy by purchasing the corporation owned locations and using local suppliers. This increased the risk KFC China took over franchising, but it helped solidify them as a Chinese brand and gave them a higher share of the profits.2
1. Based on the understanding of the case, discuss some of the objectives that KFC would have set before entering Chinese market.•Cultural differences are also things they considered when entering the market. Food is valued as the "heart of society" and it would be important to integrate flavors and regional culture in order to gain customers. To meeting the objective of serving different cultures they differentiated from the western style fast-food KFC that often did take-out, to an eat-in establishment, with a hostess and large kitchen to accommodate the larger menu. This also increased the price that KFC China sells their products at. They also trained their employees to