KFC's big bet on Asia

By Mitchell Blatt
0 Comment(s)Print E-mail China.org.cn, July 10, 2015
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The opening of Myanmar's first KFC in Yangon on June 30 brought a line of locals waiting hours for their first taste of Western fast food.

The opening of Myanmar's first KFC in Yangon on June 30 brought a line of locals waiting hours for their first taste of Western fast food. It must have also caused a mass exodus of backpacking Western hippie tourists. When the fast food comes, they're gone, probably off to Cuba to see the impoverished country before it is "ruined" when America removes its trade embargo.

The logos of soulless multinational fast-food giants like McDonalds and KFC are synonymous with globalization, obesity, and commodification. George Ritzer coined the phrase "The McDonaldization of Society" in his book of the same name in 1993, and Benjamin Barber posited that local cultures were threatened by globalism in 1995's "Jihad vs. McWorld."

All the usual critiques of American fast food may be true, but they're only half the picture. McDonalds also represents opening, development, and improving lives in a country that used to be too poor and closed off from the world. Since McDonalds opened its first shop in China in 1990, China's per-capita GDP (PPP) has risen from less than US$2,000 to almost US$12,000. Even rising obesity is a sign of prosperity. Any country that doesn't allow foreign investment and trade is going to be lagging behind on economic and social indicators.

When Ritzer's and Barber's books were out, KFC had already beaten McDonalds to Asia. By then, KFC had won the race to South Korea (1984 vs. 1988) and China (1987 vs. 1990). Since then, KFC has also been first to Vietnam, Thailand, Sri Lanka, and Kazakhstan. KFC has Myanmar, Mongolia, Nepal, Cambodia, and Bangladesh all to itself. If this is the Asian Century, it's KFC's century.

KFC has had huge success in China, where it generates half of its parent company Yum's global profits. KFC leads China in restaurants with some 4,828 to McDonald's total of over 1,700. According to an article in the Harvard Business Review by David Bell and Mary L. Shelman in 2011, KFC's success in China is due to five competitive advantages: localization, rapid expansion, logistics, quality service, and ownership.

KFC's menu in China includes a wide variety of Chinese style items like rice bowls and sandwiches with Sichuan flavor spices. The menu is much larger than the American menu, and the kitchen is larger to prepare the food, the article said. McDonalds had trouble catching up, but now they also have some localized foods, like the "jian bing" style wraps for breakfast. Both restaurants offer fried breadsticks. KFC appeared to have local dishes at its Myanmar location, including egg tarts.

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