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Kfc Opeartions Analysis

In: Business and Management

Submitted By nobese
Words 10809
Pages 44
Company History:

KFC Corporation is the largest fast-food chicken operator, developer, and franchiser in the world. KFC primarily sells chicken pieces, wraps, salads and sandwiches. While its primary focus is fried chicken, KFC also offers a line of roasted chicken products, side dishes and desserts. Outside North America, KFC offers beef based products such as hamburgers or kebabs, pork based products such as ribs and other regional fare.

KFC, a wholly owned subsidiary of PepsiCo, Inc. until late 1997, operates over 5,000 units in the United States, approximately 60 percent of which are franchises. Internationally, KFC has more than 3,700 units, of which two-thirds are also franchised. In addition to direct franchising and wholly owned operations, the company participates in joint ventures, and continues investigating alternative venues to gain market share in the increasingly competitive fast-food market. In late 1997 the company expected to become a wholly owned subsidiary of Tricon Global Restaurants, Inc., to be formed from the spinoff of PepsiCo's restaurant holdings.

New Management for Kentucky Fried Chicken

In 1964 Sanders sold Kentucky Fried Chicken for $2 million and a per-year salary of $40,000 for public appearances; that salary later rose to $200,000. The offer came from an investor group headed by John Y. Brown, Jr. a 29-year-old graduate of the University of Kentucky law school, and Nashville financier John (Jack) Massey. A notable member of the investor group was Pete Harman, who had been the first to purchase Sanders's recipe 12 years earlier.

Under the agreement, Brown and Massey owned national and international franchise rights, excluding England, Florida, Utah, and Montana, which Sanders had already apportioned. Sanders would also maintain ownership of the Canadian franchises. The company subsequently acquired the rights to…...

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