Case Analysis for Yum! Brands Essay
1313 WordsFeb 21st, 20086 Pages
1. What are the primary driving forces in the U.S fast food industry in 2004
The primary driving forces in the U.S. fast food industry for 2004 are as follows:
There is a major increase in globalization, no matter where you travel to in this time period you are guaranteed to either see a McDonalds or a Pizza Hut.
The fast food industry has diversified it product line by offering semi healthy choices, such as chicken, salads, fajitas or pizza. To this end, consumers want choices.
Consumers are more likely to be a repeat buyer at a certain fast food chain; if they find something they like, they stick to it. To this end, competition efforts have to more aggressive than ever.
The market is reaching its maturity stage so…show more content…
It's a highly competitive market with highly competitive pricing and established brand loyalty for generations.
4. What are the fast food industry's key success factors?
The key success factors of the fast food industry are quick service, inexpensive meals, product diversification and brand loyalty.
5. Complete a SWOT analysis for Pizza Hut and KFC.
Strengths: Brand recognition and in some cases, loyalty, market share leader, international expansion
Weaknesses: No product diversification, reputation of not having clean restaurants or ethical to chickens, takes out only options,
Opportunities: continue international expansion, lose negative image created by PETA, by complying with industry standard, product diversification,
Threats: PETA, Trans fat that is on the verge of becoming illegal, Boston Market healthier choice, other fast food chains who have tapped into the chicken industry.
Strengths: Brand recognition and loyalty, home delivery, small diverse product line (chicken wings, ziti, bread sticks), consist in new product ideas and promotions, international expansion
Weaknesses: limited menu, some places do not deliver, aside from couponsdoes not really offer much incentive to eat thereno prizes for the children,
Opportunities: international expansion, provide more menu options, sponsor events like McDonald's does.
Threats: fast food chains, local and national pizza shop
III. Executive Summary The fast food industry has had a large amount of success in the past couple decades and has had several competitors enter the market place. One of the largest players in the fast food market is Yum! Brands, Inc. The industry is broken up into the following segments: sandwich chains, pizza chains, family restaurants, grill buffet chains, dinner houses, chicken chains, other dinner chains, and nondinner concepts. Of these segments, Yum! Brands competes in the sandwich, pizza, and chicken chains. The indsutry has seen it’s ups and downs caused by consumer trends. Demand has gone down due to concerns over health, food quality, and unstable economy during the war in Iraq. However, other trends have helped the industry to grow, such as rising incomes of families, an increase in the number of immigrants, and more single households. Yum! Brands, Inc. is the second largest player in the fast food market after McDonalds. Some of the reasons why McDonald’s has concurred the market include having excellent supply chain management, extremely low prices, a great branding strategy. Some issues that Yum! Brands needs to focus on in order to gain a larger market share include localizing the supply chains for their foreign franchises, improving the quality of their products, diversifying their menu options, and entering new fast food segments such as the grill buffet and nondinner concept chains. By localizing the supply chains of the foreign franchise, Yum! Brands will be able to cut the costs of shipping and tariffs. They will also increase shipping time accuracy by cutting the distance traveled. Yum! Brands also has an opportunity to take greater control of their suppliers in order to get the most efficient use our of them. This could include improving the operations of their potato farms and chicken farms. The current trend in consumers is to look for healthier food options. Yum! Brands currently offers very few healthy