The Incredible Story Of How Yum! Brands Took Over China

kfc china

Photo: thaths on flickr

Yum! Brands is trading up this morning after reporting a 10% increase in profits.Most of that growth, however, came from red-hot expansion in China, with 21% same-store traffic growth. The chain actually lost ground in America, with a $52 million decline in profits, led by collapsing sales and bad publicity at Taco Bell.

The Louisville, Ky-based company has focused on international markets through the past decade, becoming the world’s largest restaurant chain with nearly 38,000 locations. In China, KFC outnumbers McDonald’s by 3,200 to 1,100.

Moving forward this shift will get even more dramatic, as Yum! acquires international brands and talks of selling Long John Silver’s and A&W.

1940 - Colonel Harland Sanders starts using a pressure fryer to increase his profits by frying chicken faster and serving more of it.

1964 - Sanders sells his now 600-strong chain of restaurants for $2 million, equivalent to $14.7 million today

Also in 1964 - The first KFC outside the US and Canada opens in England.

1966 - Kentucky Fried Chicken becomes a public company and is first listed on the NYSE as YUM

1970 - There are now almost 3,400 KFC outlets worldwide.

1986 - PepsiCo acquires KFC, merging it with Pizza Hut and Taco Bell, granting KFC access to new markets through franchise partnerships.

1987 - The first KFC opens in China, establishing a beachhead in the world's fastest growing consumer market.

2005 - KFC outpaces McDonald's in China with revenues reaching $1 billion

Today - KFC operates 5,200 restaurants in the U.S...

... and more than 10,200 Internationally...

...86 of those are in India, the World's most populous market where they are hacking away at McDonald's historically strong market share and plan to open 500 more by 2015...

... and China alone now supports more than 3,200 KFC stores in roughly 650 cities.

KFC's revenues today exceed $11 billion with profit streams coming from more than 15,000 stores in 109 countries.

But the competition is growing fast...

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