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Criticisms

Environmental concerns
KFC in the US has been accused by Greenpeace of a large destruction of the Amazon
Rainforest, because the supply of soy used for chicken food that KFC receives from
Cargill has been traced back to the European KFC. Cargill has reportedly been
exporting soy illegally for several years.[44] The Greenpeace organization researched
the issue and brought it to the attention of the parent company YUM! Brands, Inc.
The parent company denied the illegal operation, and said that their supply of soy is
grown in parts of Brazil.[44] Greenpeace has called on KFC to stop purchasing soy
[
from Cargill, to avoid contributing to the destruction of the Amazon.[44][45
Trademark disputes
In 1971, Sanders sued Heublein Inc., KFC's parent company at the time, over the
alleged misuse of his image in promoting products he had not helped develop. In
1975, Heublein Inc. unsuccessfully sued Sanders for libel after he publicly referred to
[
their gravy as "sludge" with a "wallpaper taste".[46
In May 2007 KFC (Great Britain) requested that Tan Hill Inn, in the Yorkshire Dales,
North Yorkshire, UK refrain from using the term 'Family Feast' to describe its
Christmas menu,[47] although this problem was quickly resolved with the pub being
[
allowed to continue use of the term.[48
Wages and working conditions

Balmoral KFC workers and allies picketing the store


Like many fast food outlets, KFC employs a high proportion of young, unskilled
workers, at or just above minimum wage, and its workers are not unionized. In New
Zealand, KFC youth workers earn NZ$10.13 an hour. Staff at the Balmoral, Auckland
store went on strike for two hours on December 3, 2005 after Restaurant Brands, the
franchise holder, offered no wage increase in contract negotiations.[49] In March 2006,
Restaurant Brands agreed to phase out youth rates in New Zealand, although no date
.was set
Many stores in western Canada are unionized with the Canadian Auto Workers, and
as a result many non-franchise stores in western Canada pay higher than minimum
.wage
Animal rights

Protesters demonstrating outside a KFC restaurant in Royal Oak, Michigan


Since 2003, animal rights and welfare organizations, led by People for the Ethical
Treatment of Animals (PETA), have been protesting KFC’s treatment of the animals
used for its products. These groups claim that the recommendations of the KFC
Animal Welfare Advisory Council have been ignored.[50] Adele Douglass, a former
member of the council, said in an SEC filing reported on by the Chicago Times, that
KFC "never had any meetings. They never asked any advice, and then they touted to
the press that they had this animal-welfare advisory committee. I felt like I was being
[
used."[51][52
KFC responded by saying the chickens used in its products are bought from suppliers
like Perdue Farms, Tyson Foods, and Pilgrim's Pride, and that these suppliers are
routinely monitored for animal welfare violations.[53] Several PETA undercover
investigations and videos of these and other KFC suppliers purporting to show
chickens being beaten, ripped apart, and thrown against walls contradict KFC’s
claims.[54] PETA has criticised some of the practices of chicken breeders, such as beak
trimming and overcrowding, but KFC says its suppliers meets UK legal requirements.
The Department for Environment, Food and Rural Affairs recommends a maximum
stocking density of 34 kg—around 30 chickens—per square metre, and say that in
circumstances where beak trimming needs to be carried out to prevent the birds
injuring each other, only one third of the beak should be trimmed "measured from the
tip towards the entrance of the nostrils".[55] PETA states that they have held more than
12,000 demonstrations at KFC outlets since 2003 because of this alleged mistreatment
[
of chickens by KFC suppliers.[56
In June 2008, KFC Canada agreed to PETA's demands for better welfare standards,
including favoring suppliers who use controlled-atmosphere killing (CAK) of
chickens, and other welfare standards as well as introducing a vegan sandwich at 65%
of its outlets. PETA has called off its campaign against KFC Canada, but continues to
[
demonstrate against KFC elsewhere in the world.[57
Hygiene
In February, 2007, a KFC/Taco Bell outlet in New York City was found to be rat
infested. A video showing the rats running wild inside the restaurant was shown on
television news bulletins around the world, as well as disseminated on the internet via
[
sites such as YouTube.[58
Two KFC outlets in Sydney, Australia, were fined record amounts for having
unhygienic food preparation areas. Inspectors found layers of grease and dirt, as well
as evidence of vermin. The KFC stores had been repeat offenders, and had ignored
previous warnings to keep their restaurants clean. They were charged with 11
[
breaches of food hygiene laws.[59

Who is KFC
KFC Corporation, based in Louisville, Kentucky, is one of the few brands in America
that can boast about having a rich, 57-year history of success and innovation. In fact,
KFC is the world's most popular chicken restaurant chain, specializing in Original
Recipe®, Extra Crispy™, Colonel's Crispy Strips® and Honey BBQ Wings®, with
home-style sides and freshly made chicken sandwiches. Since its founding by Colonel
Harland Sanders in 1952, KFC has been serving customers delicious, already
prepared complete family meals at affordable prices. There are over 15,000 KFC
..outlets in 105 countries and territories around the world
Every day, more than six million customers around the world make KFC part
of their lives. KFC’s menu everywhere includes the traditional Original
Recipe ® chicken and coleslaw -- made with the same great taste Colonel
Harland Sanders created nearly half a century ago. Customers also can enjoy
more than 400 other KFC products tailored to the unique tastes of our
.individual customers
KFC’s vision is to be “America’s Leading Kitchen for
Convenient Meals” and to feed every family a great-tasting
meal at least once a week. This reinforces KFC’s long
tradition of giving families an alternative to cooking -- a
tradition dating back to the late 1950s when Colonel Sanders
advertised that he was “Cooking Sunday Dinner Seven Days
”.A Week
Community and Corporate Involvement
Everyone knows that the local KFC restaurant is one of the best places in the
neighborhood to get delicious, quick and affordable meals. But perhaps you
didn’t know that your neighborhood KFC restaurant contributes more to the
.community than good food
KFC, its restaurants and its employees, are involved in countless projects that
.benefit the African American community and contribute to the local economy
Working with the Opportunities Industrialization Center, KFC has initiated
many youth hiring and training programs in several inner-city communities
.across the country
KFC is a major corporate sponsor of the Louisville Defender newspaper’s
.Minority Consumer Expo and Career Education Fair
KFC helps underwrite the Fullwood Foundation, established by KFC
franchisee Harlow Fullwood Jr. to support community projects in Baltimore’s
.inner city
In 1996, KFC launched the KFCares program in Louisville, which will enable
each local KFC restaurant manager to award a check for up to $1,000 to a
.worthwhile project in the neighborhood around his or her restaurant
KFC provides food and volunteer staffing to hundreds of social service centers
.in cities around the country
Economic Impact
KFC restaurants are much more than convenient places to get a delicious
meal. They contribute millions of dollars to the local neighborhood economy,
.providing benefits to individuals and communities across the country
KFC offers employment opportunities to neighborhood residents. Nearly all of
the 15-30 employees needed for each restaurant come from the immediate
.area, and much of the money they earn is spent in their own neighborhoods
KFC restaurants support a broad spectrum of products and services in their
local areas, including poultry dealers, produce suppliers, courier services,
.furniture and much more
KFC restaurants generate tax dollars for their communities, supporting
.important services like police and fire protection
With more than 400 restaurants in inner-city neighborhoods across the
country, KFC is already a major employer for urban residents. But we’re
doing more. In 1995, KFC began a program to renovate and upgrade many of
our inner-city units. KFC will spend about $100,000 per restaurant on
renovations, which include upgrading lobbies, adding security lights and even
selling Taco Bell products in some units. Each of these renovated restaurants
.will add about 20 new workers
,Roger Eaton
President & Chief Concept Officer KFC
KFC is the world's most popular chicken chain and every day, we serve more than 12
million customers in more than 14,000 restaurants around the world. In the United
States, KFC is a $5.3 billion business and operates more than 5,300 restaurants. Our
commitment to great food and service is the same commitment Colonel Harland
Sanders had when he founded the concept more than 55 years ago, and that's why
KFC remains the worldwide leader in the category. Thanks to great dinnertime
solutions for families and exciting, innovative menu items for a new generation of
customers, Life Tastes Better with KFC

.Copyright © 2009, Hoover's, Inc


Competitive Landscape
Demographics, consumer tastes, and personal income drive demand. The profitability of
individual companies can vary: while QSRs rely on efficient operations and high volume sales,
FSRs rely on high-margin items and effective marketing. Large companies have advantages in
purchasing, finance, and marketing. Small companies can offer superior food or service. The
industry is highly labor-intensive: annual revenue per worker is between $40,000 and
.$45,000

Full Industry Overview For Restaurants

Business Challenges
CRITICAL ISSUES

Volatile Supply Costs - Unstable manufacturer prices for raw ingredients used in restaurants
can significantly impact restaurant profitability. Commodity markets affect wholesale prices for
beef and poultry, where prices can change more than 20 percent in a single year. Supply issues
can affect the cost of seafood. The wholesale price of flour, eggs, dairy products, fats, and oils
can also increase rapidly and affect restaurant margins. Consumer price sensitivity can limit a
.restaurant's ability to completely pass through cost increases

Increasing Competition - Restaurants face increasing competition from a broad range of


businesses vying for consumers' food dollars. Grocery stores and warehouse clubs are providing
more ready-to-eat meals and sides, often at a better value than restaurants. Convenience
stores, gas stations, coffee shops, and delis sell sandwiches and beverages, cutting into
restaurants' share of the lunch market. Home cooking is also a source of competition, as
.consumers make over three-quarters of meals at home, according to NPD Group

Industries Where KFC Competes


Leisure•
Restaurants & Cafes○
Fast-Food & Quick-Service Restaurants
Top KFC Competitors
Church's Chicken•
Chick-fil-A•
Popeyes•

Mission

To sell food in a fast, friendly environment that appeals to pride conscious, health
.(minded consumers (www.KFC.com

Stated Objectives

Product development
Increase variety on menu
Introduce desert menu
Introduce buffet to restaurants

:Introduction on the Neighborhood Program with following .2

:Menu items target African Americans in major cities with the following items
Greens
Macaroni and cheese
Peach cobbler
Red beans & rice
:Menu items targeting Hispanics in major cities with the following items
Fried plantains
Flan
Tres Leches

:Implementation on non-traditional units including the following


Shopping mall food courts
Universities
Hospitals
Airports
Stadiums
Amusement Parks
Office Buildings
Mobile Units

:Increase profitability of KFC through the following


Reduced overhead costs
Increased efficiencies
Improved customer service
Cleaner restaurants
Faster and friendlier service
Continued high quality products
.Resolve franchise problems in the United States
Implied Objectives

:Expansion of international operations to provide the following


Increased percentage of overall sales growth
Increased percentage of profit growth
Increased expansion of franchises into Mexico
Expansion of franchise operation beyond Central America
Continued promotion of healthier image through removal of the word "fried" from the
name
Improve menu selection of rotisserie