Abstract
The study analyses the KFC market using the SWOT analysis. The study shows that despite the threat the company faces from its competitors in the food industry, it has potential future growth opportunities in the Chinese and Indian markets and the global food market. In India and China, the study shows that various factors have a considerable impact on the respective industry’s KFC success rate. These factors include Guanxi, collectivism, family, as well as status, and Hierarchy.
Introduction
Kentucky Fried Chicken is a restaurant headquartered in Louisville, Kentucky. The restaurant specializes in the sale of fried chicken. AAA demonstrates that the chicken is the second largest in the supply of the chicken chain. This study conducts KFC swot analysis and the future of KFC in China and India through cultural factors.
KFC SWOT analysis
Strengths
International recognition
KFC has a robust global recognition. AAA demonstrates that the KFC has approximately 19000 outlets across all the 119 nations globally. In this case, it can fetch trust among the consumers on its products, increasing the number of purchases among its products. Additionally, international recognition can attract the best management among its brand; hence, high chances of success in the respective countries.
Strong financial condition
KFC has, over the last decade, seen a robust financial performance. During the 2016 financial year, AAA indicated that the company generated about $17 billion in total revenue. In most cases, high performance is registered across Russia, Asia, and Europe.
Weaknesses
The issue regarding the quality of food supply
The company has recently experienced complaints about the quality of food. AAA asserts that the company faced criticism over the trans fats used on the non-vegetable foods. The consumers are much conscious of their health concerns. The trans food used by the company has a coastal effect on consumers’ bodies. Therefore, the consumers would look for food supplies that have hygienic oils that are safe for their health. This potentially reduces the number of consumers of its food products, which negatively affects its revenue. This negatively affects its future growth and expansion.
Opportunities
High potential growth in the emerging millennial markets
There is a high opportunity for growth in emerging markets. AAA demonstrates that there has been a surge in market consumers in countries such as Russia, China, India, and Europe. Additionally, there are still huge expansion opportunities in the respective markets. Therefore, the organization sees a huge opportunity to expand its business operations in the respective countries. High growth would lead to huge revenue generation in the future.
Threats Of KFC
The food industry has recently experienced a surge in suppliers. AAA shows that even though KFC has experienced tremendous growth in the industry, it is not still at the top. The organization faces stiff Competition from organizations such as McDonald’s corporation. The competitors have creative menus in the industry that attract more consumers. This is a threat to the future growth of the company.
Why are cultural factors so important to KFC’s sales success in India and China? (350)
KFC has recently experienced huge growth in Asian countries. Specifically, AAA indicates the rate of growth for KFC consumers in India has increased at an approximate rate of 8% per annum. In comparison, China has experienced a growth of about 12% per annum. Common factors for the respective Asian countries that have facilitated growth in the respective countries include collectivism, guanxi, family, and status Hierarchy.
The comparative growth rate of KFC outlets of China and India in the period 2016 -2017; source AAA
Cultural factors that facilitate KFC growth in China food industry
- Guanxi
China is a culture geared toward partnerships. For industry, Guanxi, or the network and connection, is essential. In this regard, AAA asserts that KFC corporation forms a special guanxi relationship with the consumers. Also, the organization minimizes risks, delays, and losses by constructing Guanxi. The Chinese tend to work with individuals they understand and trust. Second, interpersonal relationships should be formed between partners before they can begin to function together. Besides, it is not only a partnership between companies but also between these companies’ representatives. - Collectivism
Chinese society is geared towards collectivism. The party, rather than the individual, is honored. AAA highlights that KFC can influence large groups of consumers, especially in the millennial era. This leads to better cooperation, consensual decision-making, greater obedience, and knowledge exchanging among consumers. However, although the Chinese collaborate in their respective communities, organizations typically show a competitive attitude toward other organizations.
Cultural factors that facilitate KFC growth in India
Family
KFC has special consideration for family units in India. Family values are significant across India, and rights and duties are also determined by a person’s place in the family. In India, the concept of family is much wider than in most Western countries. It involves both the bloodline and marriage of the entire wider family. Religion commonly establishes a new family identity. Many Indian firms historically have been run by loyalty and sustainability as an extension of the family model.
Status and Hierarchy
The traditional Indian culture has been strongly organized and has determined its role throughout the lifespan. Indian cultural status has been defined, in addition to families, by a set of other markers, including gender, parenthood, marital status, age, and personality, in addition to families. KFC corporations in India still have all of these considerations in view. Standard rank and order ideals may affect who is shortlisted for a work interview or at lunchtime.
Conclusion
Through KFC SWOT analysis, it can be generally concluded that the organization has high future expansion potential in the food industry globally. Based on the cultural factors in various Asian countries such as China and India, KFC is projected to experience successful ventures in the respective markets.
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