KFC SWOT Analysis 2021

KFC SWOT Analysis 2021

This is a comprehensive SWOT review of KFC that will help you understand the strengths and weak points of KFC. 

It also examines potential opportunities that the company ought to look into and the risks they should construct strong walls to defend against. 

KFC is an American fast-food chain with its headquarters within Louisville, Kentucky, the USA.

kfc swot analysis

Company Background

Key Facts
Name KFC (Kentucky Fried Chicken)
Founded March 20, 1930
Logo KFC (Kentucky Fried Chicken) logo
Industries served Restaurants, Fast Food
Geographic areas served Worldwide
Headquarters The U.S.
Current CEO Roger Eaton
Revenue $ 9.5 billion (2012)
Profit N/A
Employees N/A
Parent Yum! Brands
Main Competitors McDonald’s Corporation, Burger King Worldwide Inc., Subway, Wendy’s Company, and many others.

Overview of the company

KFC is a worldwide quick-service restaurant chain operator and franchisee with its head office located in Louisville, Kentucky. 

In 1930 Colonel Harland Sanders established KFC (Kentucky Fried Chicken) and was sold in 1986 to PepsiCo 1986.

it is now, following the spin-off of PepsiCo KFC is an affiliate of Yum! Brands, Inc. KFC’s portfolio of products includes Colonel’s recipe for fried chicken sandwiches, signature mix bones of chicken bowls, chicken stripes of deserts, and box meals (Burrell 2020, Bloomberg Bloomberg 2020; Bloomberg, 2021). 

As per Forbes (2021), it has a brand’s value was $8.3 million, and it’s placed as the 96th most valued brand.

Strengths of KFC 

kfc swot analysis

  • The signature recipe of the Colonel and his trademark bucket: KFC is a secret trade of the original colonel Sanders’ chicken recipe, which contains 11 spices and herbs. The original recipe remains unidentified to the general public. The bucket made of paper is a symbol of KFC’s serving their famous fried chicken. It was in the year 1957 that the very first KFC chicken bucket was offered and to date, the bucket is responsible for 35% of the total KFC sales. KFC (KFC 2021, KFC).The world’s largest restaurant franchise and system: Based on Yum Brands (2021), KFC has 25,000 locations across 146 countries. In the YUM year-end report (2020) 84 percent of KFC restaurants are in international markets, and 99percent are managed through franchises. In 2020, franchises had 24,710 (4 percent increase over 2019) and the company-owned restaurants were 292 (16 percent less than in the year prior).

    Unique store design and business culture: The four pillars of the KFC business model include (1) using unbeatable human capabilities, culture, and expertise, (2) unmatched operating capabilities to offer the best service to customers, (3) building a straightforward, unique and memorable brand, and (4) making iconic brand recognition for restaurants. The fundamental restaurant model, dine-in or Drive-Thru restaurants incorporates brand-inspired materials and color applications, a specific design, and themes to give the brand character and joyful love of chicken (Yum Brands 2021).

    KFC enormous success China: Jacobs (2021) stated Jacobs (2021) pointed out that KFC has over 5000 outlets in China and has an estimated market share of 5%, it is the dominant fast-food chain. The popularity in the success of KFC throughout China is due to its localized menu that includes Dragon Twister, egg tarts and rice porridge (congee) has enabled KFC to gain the largest market share (Insead 2021).

Weaknesses Of KFC

kfc swot analysis

  • Consistent supply chain risk and backlash from customers: KFC has announced disruptions to its supply chain and food shortages warnings in the UK which prompted customer responses to the hashtag #kfccrisis on social networks. Adam (2021) said that KFC posted on Twitter the fact that certain items of food like lids, cups, and chicken will not be in stock due to delays in transportation. In the year 2018, KFC had a disruption of its delivery chain across the UK in which the company had to shut down its 750 locations throughout the country following the termination of its delivery contract with DHL (Pooley 2019).
  • Fat and unhealthy food image: KFC utilizes a large amount of cooking oil to fry the chicken. Chan and others (2020) reviewed the fact that oily and salty foods can trigger numerous health problems, including obesity and pressure. Health-conscious consumers prefer low-calorie and non-oily meals. KFC chicken is a bad image in the healthy food sector.
  • Failure in India and Israel: In the global market, KFC is a failure in the global market. KFC is not aware of the culture and has not worked on both the Israeli as well as Indian markets. In India, the company has been unable to recognize target groups and to understand the tastes and preferences of its customers. In the same way, KFC did not adapt to the local culture of Israel. In India KFC, they are keen on selling spicy and hot food, and not an unpublished recipe (Saini 2020)
  • Franchise risks: KFC is a brand with a bad reputation and poor performance is a result of franchises’ insufficient conformity with operating procedures. Operations issues create discontent and conflict between the franchisee and management. In the past, there have been concerns about technology and branding, royalties, and franchisees’ failure to comply with corporate standards (KFC 2021)
  • Market risk in foreign markets: KFC has been the subject of financial regulatory oversight in India for violating foreign exchange regulations and failing to comply with the regulations including minimum investments, operating approvals, and remittance limits (Yum Brands 2021).

Opportunities Of KFC

kfc swot analysis

  • The demand for healthier food: While demand for healthier food is growing, KFC could introduce healthier options for food on its menu, and turn its weaknesses into its strength.
  • Home delivery of meals: KFC could fully utilize (it is testing delivery services right now) this potential and serve more customers.
  • The company is introducing new products to its exclusive chicken menu: KFC could introduce new menu items and also offer beef, pork, or just vegetarian options, which would appeal to a wider category and lead to increasing the number of customers.

Threats Of KFC

kfc swot analysis

 

  • Markets for fast food are saturated in developed economies: The fast-food market in the developed nations is already over-crowded with many fast-food restaurants and it is already proving an issue for KFC since it is finding it difficult to expand in developed economies.
  • The trend toward healthier food choices: Due to government and other organizations’ efforts to reduce obesity the population is becoming more aware of eating healthier food and not just what KFC provides on its menu.
  • local fast-food chain restaurants: Local fast-food restaurants often provide localized approaches to serving menus and food that represents the local taste. While KFC excels in adapting its Menu to suit local preferences, a growing amount of fast-food restaurants in the local area and their low meal costs can pose a threat for KFC.
  • The effects of currency fluctuations: KFC receives part of its revenue from foreign operations. The income earned must be converted to dollars, which could impact the company’s earnings, particularly when the dollar appreciates against other currencies.
  • The lawsuits for KFC. KFC has been sued a number of times and has lost many lawsuits. Legal proceedings are costly because they take time as well as money. Since KFC remains operating in more or less in the same manner there is a high chance that more costly lawsuits will follow.

FAQ

What are the advantages and disadvantages of KFC?

The benefit of KFC’s business is that they are able to create products that satisfy the demands of customers. The drawback of KFC company is the fact that they need to consider what people think about their products and that could be beneficial to the company. Stakeholders are people who have an interest in the business.

What are the goals and objectives of KFC?

KFC’s goals and aims KFC do not just selling chickens to earn money and turn profits They also aim to expand their business whether it’s an international business or to set up several more locations across the country, to offer more efficient service, quicker services, and more efficient customer service, and beat out the competition.

How does KFC promote its product?

KFC utilizes all forms of media, including hoardings, TV and print courses advertisements, etc. to advertise. KFC has a significant social media presence, which allows it to engage with its customers and gain more information about its products as well as other services. KFC utilizes its social media channels in a way to market its new products.

How management functions are performed at KFC?

KFC offers two kinds of planning: Operations Planning as well as Strategic Planning. Strategic Planning is carried out to boost its market amount of market share, while Operational Planning involves the launch of new products to improve or change its range of products for its customers. The menu planning process is accomplished by conducting research.

How KFC adapts around the world?

According to the experts of The Harvard Business Review, “the strategy that emerged from this time was very simple and contained five revolutionary elements. making KFC into a brand considered to be part Chinese and rapidly expanding into smaller and mid-sized cities, and establishing a massive supply chain and logistics.

How does KFC meet customer needs?

KFC has been working to meet customers’ needs by making menu items that are adapted to the mobile, ever-moving society as well as the evolving tastes of consumers. Menu items that are popular such as Spicy Chicken Wings BBQ, Popcorn Chicken, Extra Crispy Chicken as well as Crispy Caesar Twister have been developed to satisfy the needs of the customers.

Why is KFC successful?

The reason behind the success and the growth for KFC is the franchise system through which KFC operates. Colonel Sanders’s fried chicken was a huge hit in Kentucky. He founded the KFC franchise in the year 2000 and within a short period of years, the chain had a lot of KFC restaurants throughout the US.

What is the slogan of KFC?

KFC was established around 1930 through Harland Saunders, launched their first restaurant in the 1950s, and has been using its Finger Lickin Good slogan ever since.

What are the brand elements of KFC?

The background of red and white has three horizontal lines. The Colonel’s black is placed across the lines of white and the KFC Italicized wordmark beneath it. KFC’s logo is a striking and welcoming design. KFC logo is vibrant and warm, which makes it an ideal choice for fast-food establishments and evokes feelings warm and welcoming.

SWOT Analysis of KFC: Conclusion

This SWOT study of KFC included in the article revealed its strengths. The main strength of the brand.

These strengths stem out of its global presence, rapid expansion over time as well as its strong financial stability, plenty of menu choices that outperform rivals, having a solid customer base, and its unique recipe. 

Its weaknesses are highlighted by the numerous concerns regarding food, franchisee operations, and distribution of the supply chain.

KFC has a variety of potential in incorporating many choices of vegetarian meals as well as changing menus to accommodate healthier eating habits, reducing the price of food items, and expanding into the new markets. It is worried about its competition and also from the increasing cost of different sources it has.

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