III. Executive Summary The fast food industry has had a large amount of success in the past couple decades and has had several competitors enter the market place. One of the largest players in the fast food market is Yum! Brands, Inc. The industry is broken up into the following segments: sandwich chains, pizza chains, family restaurants, grill buffet chains, dinner houses, chicken chains, other dinner chains, and nondinner concepts. Of these segments, Yum! Brands competes in the sandwich, pizza, and chicken chains. The indsutry has seen it’s ups and downs caused by consumer trends. Demand has gone down due to concerns over health, food quality, and unstable economy during the war in Iraq. However, other trends have helped the industry to grow, such as rising incomes of families, an increase in the number of immigrants, and more single households. Yum! Brands, Inc. is the second largest player in the fast food market after McDonalds. Some of the reasons why McDonald’s has concurred the market include having excellent supply chain management, extremely low prices, a great branding strategy. Some issues that Yum! Brands needs to focus on in order to gain a larger market share include localizing the supply chains for their foreign franchises, improving the quality of their products, diversifying their menu options, and entering new fast food segments such as the grill buffet and nondinner concept chains. By localizing the supply chains of the foreign franchise, Yum! Brands will be able to cut the costs of shipping and tariffs. They will also increase shipping time accuracy by cutting the distance traveled. Yum! Brands also has an opportunity to take greater control of their suppliers in order to get the most efficient use our of them. This could include improving the operations of their potato farms and chicken farms. The current trend in consumers is to look for healthier food options. Yum! Brands currently offers very few healthy
Case | HBS Case Collection | May 2012 (Revised October 2012)
Jordan Siegel and Christopher Poliquin
Yum!, the owner of KFC, Pizza Hut, and Taco Bell, asks what might be the lessons from its success in China for currently contemplated expansion into India and Africa. Also, the company contemplates whether Taco Bell can succeed abroad as part of a new expansion push. Also, the case asks what distance barriers are relevant for a fast food company specializing in part on fried chicken and Tex-Mex food.
Keywords: international business; international marketing; Global Strategy; Competitive Strategy; Food and Beverage Industry; United States; Europe; Australia; Africa; Asia;
Citation:Siegel, Jordan, and Christopher Poliquin. "Yum! Brands." Harvard Business School Case 712-422, May 2012. (Revised October 2012.) View Details