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KFC: Business Details, Marketing Strategies And Analysis

Company information:

Company name     Yum! Brands
Sector                      Restaurants
Founded                 Sanders Court & Cafe: 20.03.1930
Founder(s)              Harland Sanders
IPO date                  Wednesday, 17.09.1997
Location                  Louisville, Kentucky, US
Website                   www.yum.com, www.kfc.com

Fundamentals and financials:

Market cup                         $26.33 billion
Revenue                              $3.604 billion
Employees                          90000
Revenue/employee           $40040
Net income                         $1.375 billion
Shares outstanding           344.8 million
Annual earnings/share      $3.74
P/E ratio                               20.42
Company management: Greg Creed (Director and Chief Executive Officer), Brian R. Niccol (Chief Executive Officer of Taco Bell), Roger Eaton (Chief Executive Officer, KFC Division)

KFC, formerly known as Kentucky Fried Chicken, is a chain of fast food restaurants that can be found in over 120 countries over the world, represented by over 20 thousand establishments.

A quick history lesson: the company was founded by ‘Colonel’ Harland Sanders, who started selling fried chicken at his modest establishment in North Corbin, Kentucky. The “when” is also of note, since it all began during The Great Depression, way back in the 1930s.

KFC | Today’s Teens | Original Recipe

As could be imagined, his business wasn’t successful from the get-go, it took a while for him to get on track and reach a second location in Salt Lake City – 22 years, in fact. “Colonel” himself was 62 years old at that point.
Nevertheless, said establishment still goes strong and proudly markets itself as being the “World’s First KFC.” Later, thanks to the power of franchising, the brand became one of the most popular global food chains.
Another piece of historical trivia – it was KFC that challenged the dominance of the regular burger as a staple of any fast food menu.
What did Sanders do to achieve this success? Let’s find out with this list of associated reading.

Financial Data

It takes a lot of commercial success for a company such as this to stay afloat, and financial data of operations tends to back that up.
Back in 1966, when the business was getting too big for Sanders to handle on his own, he decided to sell it. He took a $2 million dollar deal, and he managed to reserve the right to make public appearances for which he was getting paid $40k annually.

As of now, ever since KFC became a subsidiary of Yum! Brands, it enjoyed tremendous success on the Asian market – China, specifically. Even though KFC doesn’t anymore get the recognition domestically, it more than makes up for it internationally. However, since the US market constitutes about 60% of Yum! Brands’ revenues, some strides need to be done in order to get a bigger market share domestically.

Yum’s stocks sit at roughly $75 per, with annual revenue sitting at $1 billion (some fluctuations may apply) and assets currently sit at around $2 billion. Respectable numbers, but let’s delve deeper. Feel free to explore materials below.

Marketing

Even though Sanders had sold his rights to the brand by the point the franchise reached its apex; he still acted as a brand ambassador for a while.
The initial marketing approach deserves an honorable mention: ‘Colonel’ Sanders traveled for thousands of miles annually to promote his brand, and his image could be found everywhere as far as marketing was concerned. But after his death in 1980, the company decided to ditch his iconic image and the now-classic red-white color palette from marketing materials. A questionable choice, as financial data backs up. The next significant change took place in 1991 – ‘Kentucky Fried Chicken’ adopted a simplified abbreviation “KFC” as a part of a rebranding push.

What else is there to explore? How does the company approach its marketing campaign? Is there a place for slogans like “Finger Lickin’ Good” and “So Good” in the modern world? How many spices are there in the recipe of KFC’s legendary chicken? Let’s find out.

Structure & Operations

KFC is a wholly owned subsidiary of Yum! Brands, the largest fast food company in the world with over 35 thousand establishments. Outside of KFC, Yum! Brands also have Taco Bell, Pizza Hut and Long John Silvers (along with some others) in its possession. The parent company pays almost $700 million in dividends and has total assets worth $8 billion. If anything, it’s fair to say that this corporation knows what it’s doing.

Analysis

Almost a billion dollars gets spent on capital expenditures (as in, equipment acquisitions and property). The bottom line for this brand is simple – KFC needs to do a lot more to persuade Americans to give its chicken another try.
Many competitors have thrived, especially Chick-fil-A, the direct rival that bumped everyone off to become the #1 chicken food chain.
Considering what the company is up against, it’s safe to say that it’s a cutthroat market and requires extensive examination of the brand’s strengths and weakness before it can get back to its roots. Read associated analyses below.

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