This Is The Formula Yum! Brands Is Using To Dominate The Fast Food Market In China

KFC China

Yum! Brands is doing spectacularly well in China, especially with KFC and Pizza Hut, which now dominate the fast food market there. It may even be the most successful US consumer company in China right now, says Paul La Monica at CNN.

There are now more than 3,700 KFC locations in over 700 cities in China, along with 626 Pizza Hut restaurants.

And people are flocking to those locations — same-store sales at KFC and Pizza Hut in China rocketed up 21% in the quarter.

In other overseas markets like Russia, Yum! has had to tinker and rebrand to get things going, and it’s still having trouble. But in China, things are working perfectly.

So, how is Yum! making it work in China?

Hiring good talent.

Here’s what CEO David Novak had to say on Yum!’s Q4 earnings call when asked about the company’s vast success there:

Our whole formula for success in China has been geared on great local management team with phenomenal local operating capability. And we’ve always had one rule, we never want to expand any further than or faster than our people capability. Because we’ve got these brands that are so good, we just want to keep polishing the diamond. Now having said that, when you look at our operating capabilities, the best we have in the world, 90% of our restaurant managers in China have at least a college education.

But we’re like the Procter and Gambles, the king of marketing talent in the United States. We see ourselves as the leader in operating talent in China. The second big thing on people capability is just our development operations. Our development team — we have 700 people in our development team. And we have the best retail management base in China. This is a huge competitive advantage as we go forward.”

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