Chapter 13 KFC China 20 Years

On November 12, 1987, a foreign fast food restaurant quietly opened on Qianmen Street, Beijing. Standing at the door of the restaurant was an old foreign man with a white beard and glasses, smiling and waving to customers.People queuing up to eat were surprised to find that the restaurant didn't sell noodles or rice, and there were only a few items on the menu. On March 12, 2007, at the KFC restaurant at Hangzhou Xiaoshan International Airport, when Zhang Fan, a college student, tasted the new product "Wu Shuang Wing Sword" very habitually, he never thought that the middle-aged man smiling at him in front of him was a Chinese who had just inspected the Zhejiang market. Su Jingshi, President of Yum!

From 1987 to 2007, the 20 years of KFC’s changes in China were so subtle, like spring rain moistening fine things, this “finger-good” home chicken has become one of the largest retail foods in the world.Especially in the Chinese market, KFC is expanding "tirelessly" in China's territory with a growth rate of 18% by opening a new store every day. Although 20 years of development has made KFC a household name in China, its parent company, Yum! Global Restaurant Group (hereinafter referred to as Yum!), has kept a low profile as much as possible, so that many people are unfamiliar with Su Jingshi, and are even more at a loss about his resume.Su Jingshi is tall. If it weren't for this, this striding man with a backpack on his shoulders might not be noticeable in the crowd.But he is the only person who can lead the team to defeat its old rival McDonald's in the KFC global market.

The U.S. "Fortune" magazine commented that the success of Yum! Global Catering Group in the Chinese market, "really plays a key role in the flexible management of Su Jingshi, President of Greater China."When Fortune made this comment, Yum! opened its 500th KFC store in China. In 1989, when this Taiwanese with a master's degree in science from the University of Pennsylvania and an MBA from the Wharton School came to the mainland for the first time, there were only four KFC restaurants in China.At that time, Su Jingshi was the marketing planning director of KFC North Pacific region. Five years later, Su Jingshi served as the vice president of PepsiCo Catering International Group in Asia and began to manage two catering brands of KFC and Pizza Hut at the same time.

In October 1997, PepsiCo decided to divest its catering business, including three chain fast food businesses including KFC and Pizza Hut, and established Yum! Global Catering Group. In 1998, Su Jingshi was officially appointed as the president of Yum Greater China, and started his legendary journey in China. Since then, Su Jingshi's goal has never changed - to develop Yum! into the number one brand in China's catering industry.Since then, he has devoted himself to continuously publicizing and explaining this goal. Almost all employees know what Yum! It is also the world's top excellent fast food company McDonald's landed in China on October 8, 1990, and opened its first store in Shenzhen, the window of reform and opening up.In terms of time, McDonald's has lagged behind KFC by 3 years.The Chinese market with the largest population in the world and unlimited potential has already been snatched away by KFC.

In fact, from a global perspective, KFC and McDonald's are not yet a heavyweight.Whether it is development history, overall scale and strength, or even brand equity, KFC lags behind McDonald's.McDonald's ranks among the top ten most valuable commercial brands in the world, while KFC doesn't even make the top 50.However, the overall development status of McDonald's, the absolute leader of the world's No. 1 fast food brand in the Chinese market, is uncharacteristically far behind the No. 2 brand in the world and KFC, the No. 7 in the U.S. domestic market. The performance between the two is not the same far.

Su Jingshi said modestly, "As far as the current situation is concerned, Yum's market situation in China is very good. But in the long run, there is still a long way to go before success." "My only feeling is that the Chinese market is huge, and we have every chance Take KFC to an unprecedented height in history." Only the first will be remembered, this is the status quo of market competition.Expansion is the imprint Yum has left on the Chinese market in the past two years.From the opening of the first store in 1987 to 1992, there were still 10 KFC restaurants nationwide in five years. Four years later, on June 25, 1996, the 100th KFC store opened in Anzhen Bridge, Beijing.However, it only took 6 years for KFC to go from 100 to 1,000.Subsequently, KFC China developed faster and faster. From 2002, 9 chain stores opened per month to 25 chain stores per month in 2003. Now KFC has more than 1,700 stores in mainland China.

2005 marks the 50th anniversary of McDonald's.However, Yum! gave McDonald's an unpleasant birthday present.According to the statistics disclosed by the British "Economist" on August 28: Yum's restaurant chain stores in the world have risen to 34,000, more than 2,000 more than McDonald's. Yum China, led by Su Jingshi, President of Greater China, has once again become the key to Yum!Now Yum! opens an average of 3 new stores around the world every day, one of which is in China.The profit of the KFC chain stores in the Chinese market accounts for 1/3 of that outside the US market. The expansion rate in the past seven years has reached 70%, and the operating income during the same period is twice that of McDonald's (China).No wonder "The Economist" lamented: People buy Yum's stock not because of the United States, but because of China.It is a good strategy to use China's excellent performance to balance the mediocrity of the United States.

Zhejiang is a very magical land, where miracles of wealth happen every day, even an ordinary coin seems to shine like gold.As the world's largest fried chicken fast food chain enterprise, how could it easily give up this valuable market. In 1992, when Deng Xiaoping, the chief architect of China's reform and opening up, delivered a speech on the southern tour, the "China's second ticket" food stamp with 40 years of "service" retired in Zhejiang. That year Hangzhou KFC Co., Ltd. was officially registered and established.I don't know whether it was a deliberate choice or an unintentional choice, but the time in the registration book of the Industrial and Commercial Bureau shows that it is December 24th, and KFC chose to enter the Zhejiang market on Christmas Eve.

On April 12, 1993, the first KFC in Zhejiang Province appeared in the beautiful West Lake——Hangzhou. The Taiheyuan Restaurant on Renhe Road in Hangzhou became the kitchen of "Colonel Whitebeard Sanders".Many young people are humming Su Rui's "Holding Hands" to date their future spouses, and they coincidentally appear in KFC fast food restaurants that keep popping up. Soon, starting from Hangzhou, KFC restaurants sprung up all over Zhejiang. On July 12, 1994, KFC entered Jiaxing, the center of the Yangtze River Delta; on November 2 of the same year, KFC entered the ancient city of Shaoxing; on the 30th of the same month, KFC Ningbo opened; A little place”, until April 28, 2001, the KFC Lishui store opened.So far, the smile of Colonel Harlan Sanders has appeared in nearly 50 cities in 11 prefecture-level cities in Zhejiang, including Ningbo, Wenzhou, Jinhua, Quzhou, Lishui, Zhoushan, Taizhou, Huzhou, Jiaxing, and Shaoxing.

In 2004, the 100th chain restaurant of KFC in Zhejiang opened in Fengqi Road, Hangzhou, thus Zhejiang market became the third province and city in the country with more than 100 KFC restaurants after Shanghai and Beijing. People are amazed.However, KFC's distribution work in Zhejiang did not stop there. On August 31, 2004, when KFC’s first university park restaurant in the country, Ningbo Xuefu Store, opened, the person in charge of Hangzhou KFC Co., Ltd. said with confidence: “In the next two years, the number of KFC’s restaurants in Zhejiang Province will reach 200, for KFC, there are still many places in Zhejiang Province that can open restaurants, and at this speed, many places feel that it is too late."

Zhejiang's fast-growing economy has enabled KFC to have a huge consumer base. Fifteen years have passed, and now KFC's performance in Zhejiang is the best in the country and in the world.Not only has it opened enough branches in Zhejiang, but it also ranks first in the revenue ranking of KFC operating companies across the country. In 2004, the turnover of Cixi Store and Wenzhou Renmin Store ranked first and second in the country respectively; on April 1, 2006, Ningbo Xiangshan Tianan Restaurant even set a national record for the single-day turnover... Zhejiang is almost a condensed version of the Chinese market. Since KFC entered Hangzhou in 1993, McDonald's entered Zhejiang five years later and chose to open its first store in Jiaxing.One step behind and one step behind, the current McDonald's restaurant in Zhejiang can only belong to the middle level compared with its development speed in other cities in China.Gregory, the newly appointed general manager of McDonald's Fujian, Zhejiang and Jiangxi regions, admitted that the development of McDonald's in Zhejiang is indeed too slow. According to Zhejiang's economic development level, "Zhejiang McDonald's" should also be at the forefront in China, but it is precisely Zhejiang that has become both in China. The province with the largest gap. "This status quo will certainly change soon."The layout of McDonald's in Zhejiang is to open "far more than 100" restaurants. "We want to rekindle the enthusiasm of customers for McDonald's." An amazing detail worth noting about KFC in Zhejiang is: Zhejiang is a place where private capital is influx, but today, KFC has opened nearly 200 stores in Zhejiang, and none of them is a franchise store.And through franchise stores, brand holders can quickly occupy the local market through the operation of local funds in the shortest possible time.Ms. Ai Yunfeng, general manager of Hangzhou KFC Co., Ltd., which operates the Zhejiang market, disclosed that, judging from the current situation, the idea of ​​private capital joining KFC and setting up a branch in Zhejiang will not be possible for a long time. Even so, the development of KFC still provides a large number of job opportunities for Zhejiang Province.At present, KFC has a total of more than 7,000 employees in Zhejiang, and 100% of them are localized.These employees have undergone standardized and professional training by international companies, and some restaurant waiters have successfully achieved the position of operation manager. The "spillover effect" and role model of talents will undoubtedly have a subtle influence on improving the quality of employees in the catering industry in Zhejiang Province. The 20-year success of KFC in China says a lot.But there is one secret that ordinary people know, and that is to constantly practice "face changing".KFC has been changing quietly, and it has been quietly making localized changes in China.Use the way of Chinese localization to deepen brand influence and competitive advantages, making the Chinese market the "base camp" where KFC overwhelms McDonald's. How to innovate in China?KFC's understanding is to free itself from the shackles of American culture and "realize localization."In order not to let the consumers who adore it escape, KFC has never stopped making efforts to localize in China since it entered China.The proportion of KFC's global products is 20% of newly developed local products and 80% of traditional products, but in China, the proportion of new products may have reached 40%, especially the nutritious breakfast "porridge" provided alone, which has no precedent in the world. "The Chinese market is always changing. We hope to grasp these changes earlier and faster than our competitors and make innovations." Su Jingshi said, "KFC will give consumers what they need, and this need includes potential needs. As long as consumption If consumers like it, we will stick to it. Because consumers are the only conditions for the survival of enterprises.” In 2000, KFC began to figure out the taste of Chinese people, and products with Chinese characteristics were continuously pushed to the fore.From the Chinese-style old Beijing chicken rolls to the Cantonese-style sweet and sour chicken rolls, from New Orleans grilled wings to Xinjiang cumin grilled wings, from Portuguese egg tarts to the current cappuccino egg tarts, from hibiscus fresh vegetable soup to Tomato and Egg Drop Soup, from Guozhen Orange Juice to Jiuzhen Juice, KFC has added more and more Chinese elements to its product categories, and can always change its patterns and launch new products that stimulate the taste buds according to the tastes of Chinese people.Secondly, in terms of product naming, KFC also took great pains to "Tang costume", what kind of flesh and blood are connected, proud and strong wings... All these, it can be seen that KFC has put a lot of effort into becoming "earth".No wonder someone joked, "I wouldn't be surprised if KFC starts selling dumplings filled with fried chicken one day. Because they are getting closer and closer to the eating habits of Chinese consumers." Worried about food safety, Su Jingshi transferred one of the most experienced people in the world from the headquarters to help them with food safety and control; if there is a problem with the supplier link, he will manage it layer by layer; Chinese consumers eat Western fast food Will be tired of eating, Su Jingshi developed a variety of fast food that suits Chinese tastes.Now, the Chinese market has not only existed as a branch of the global market, it has even become a provider of successful experience.So much so that David Novak, global president of Yum! Global Catering Group, said: "China is the best-developed market, and we want the world to share China's experience." Now the old Beijing chicken rolls, which are popular among Chinese consumers, have appeared in KFC restaurants in Indonesia, Malaysia, Japan and other Asian countries.Not only that, Su Jingshi created the only Chinese fast food restaurant of Yum Group born overseas, "Dongfang Dingbai", although this Chinese fast food restaurant that sells buns, soy milk and rice noodles contributes so little to Yum's profit.At the same time, KFC China's original sponsorship and naming three-person basketball game is being promoted by the US headquarters to other parts of the world. In 2004, when KFC opened 1,000 stores, it released a set of plans that took three years to make: "China KFC Healthy Food Policy White Paper", in order to gradually eliminate people's bad impression of foreign fast food.The significance of this action is that they want to tell consumers that KFC pays more attention to the health of Chinese people than you do. At the beginning of 2005, KFC officially announced that the national KFC stores in China had begun to change their faces—no longer defending the American fast food style, but "changing for China and creating a new fast food"!This is the biggest strategic transformation since KFC entered China, and then KFC put forward the concept of "balanced nutrition, healthy life", which opened the prelude to the new fast food movement. In the past few years, KFC has also implemented a localization strategy of supply sources.According to a data, since KFC opened its store in China in 1987, the chain stores of KFC Fast Food, which is controlled by the American Yum!It is roughly estimated that the total amount of chicken sold by KFC in China is more than 624 million chickens. If each chicken is arranged end to end, it is equivalent to traveling from Mohe at the northernmost point of China to Zengmu at the southernmost point. Shoal 36 times away! In 2005, KFC launched a seemingly plain and unremarkable slogan in the Chinese market - "Based in China, integrated into life", and vigorously spread it across the country.Just like martial arts masters fight without a sword, there is a sword. The scary thing about "Based in China and integrated into life" is that KFC seems to want to be a steamed bun shop in a Beijing alley, a dim sum shop in a Shanghai alley, and a soybean milk stand in a small street in Guangzhou.KFC not only maintains a high-speed store opening pace in first- and second-tier cities, but also penetrates into third-tier cities. On the KFC website, there is a search bar for restaurants in the neighborhood. Consumers can easily find the nearest KFC restaurant just by entering their city and region. KFC does not want to be a high-ranking multinational company, but is willing to go down and become a truly local company. "Most multinational companies come to China to copy the global model, but Yum! wants to build a brand that Chinese consumers need." Su Jingshi said, "My task is to promote the localization of Yum! China." Now, the image of KFC has changed fundamentally in China, and it seems that KFC is about to become a way of life for Chinese people.