Three Reasons Chick-fil-A Is Destroying KFC

Chick-fil-A has surpassed KFC as the top chicken fast food chain.

The fast food chain now controls the most market share in the chicken restaurant market, according to a recent report by Janney Capital Markets.

“Chick-fil-A’s ability to grab market share within the U.S. limited-service chicken category has been

legendary,” writes Janney analyst Mark Kalinowski.

In 1999, KFC controlled 40% of the market, while Chick-fil-A had just 9%.

Today, Chick-fil-A is the “category leader,” with a 26% share compared with KFC’s 22%.

The company also outsells KFC.

Chick-fil-A’s sales in 2013 passed $US5 billion, compared with KFC’s $US4.2 billion, Venessa Wong at Bloomberg Businessweek reported earlier this year.

Chick-fil-A has about 1,775 U.S. stores, while KFC has 4,491. Despite a smaller footprint, Chick-fil-A’s average sales are more than triple those of its larger competitor, Wong wrote.

Chick-fil-A achieves these results despite being closed on Sundays for religious reasons.

Here are a few reasons for Chick-fil-A’s success.

1. Breakfast business. Chick-fil-A has a popular breakfast menu that helped elevate sales by 3.6% last year. This is crucial at a time when demand for breakfast is at an all-time high. While KFC also offers breakfast, sales sunk 2% at its locations.

2. Differentiated menu. Chick-fil-A has a menu that is different enough to set it apart from fast food competitors. Popular items include its signature chicken sandwich and waffle fries. However, Chick-fil-A also offers ice cream, milkshakes, and wraps. Long known as a carry-out dinner option, KFC has struggled to find its footing in the fast food space.

3. Room for growth. Chick-fil-A has few restaurants in the Northeast — meaning that they have plenty of room for growth, according to Janney. These states are heavily populated, which could mean big sales for Chick-fil-A. Here’s a chart from Janney showing 10 states with growth potential, compared with how many locations McDonald’s has in those states.

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