Fresh off a major milestone, the category icon is eyeing 50,000 locations worldwide, with zero signs of slowing down.
KFC Global CEO Sabir Sami travels about two weeks of every month. A recent trip brought him to his home country of Pakistan, where a new store was reporting 10,000 transactions per week. It was still the opening month. Sami, a Yum! Brands vet since 2009 who’s worked at each of the world’s largest restaurant group’s flagships—Taco Bell and Pizza Hut included—during his time as GM of Yum! Canada cautioned the honeymoon wouldn’t last forever.
Maybe it would level out at 6,000 or 8,000. Calmly, the operators disagreed. “They said, ‘no, no, no, no, we think it will plateau at 14,000 a week,’” Sami recalls. “That’s where they think it will go up to. That is insane numbers … It just shows the strength of the brand in every part of the world.”
The story of Colonel Harland Sanders selling fried chicken from a roadside restaurant in Corbin, Kentucky, is a well-worn piece of American fabric. At age 65, he began franchising with a $105 monthly Social Security check and opened the first partner unit in 1952 in Salt Lake City with Pete Harman.
There isn’t another restaurant, or retail brand for that matter, as visually aligned and recognizable as the Colonel and KFC. Norman Rockwell even painted Sanders and his famed white suit in the early 1970s. The portrait hangs in the brand’s Louisville, Kentucky, museum that adjoins the three-story colonial style building known colloquially as the “White House.”
But in the 1960s is when KFC’s larger imprint took its first steps. It was one of the original U.S. quick-service chains to expand internationally as it headed to the U.K., Mexico, and Jamaica.
These days, Yum! CEO David Gibbs refers to KFC International as one of the company’s “twin growth engines” (the other is Taco Bell U.S.)
Some recent statistics feel like entire history books for many. In 2023, KFC International opened nearly 2,700 new restaurants (2,682 to be exact, alongside 415 closures), reaching 10 percent growth as units opened across 96 countries. That’s a location every 3.3 hours. If you tried to wedge that number onto a U.S. map, KFC’s global expansion last year alone would outsize the entire domestic footprints of Jimmy John’s, Jack in the Box, Panera Bread, and Panda Express, just to count a few.
The big milestone, however, arrived in January as KFC crossed the 30,000-unit mark with an opening in Rome, Italy.
2023
Percent of KFC system sales
- China: 27 percent
- U.S.: 14 percent
- Europe (excluding U.K.) 11 percent
- Asia: 10 percent
- Australia: 7 percent
- Latin America: 7 percent
- U.K: 6 percent
- Middle East/Turkey/North Africa: 6 percent
- Africa: 5 percent
- Thailand: 2 percent
- Canada: 2 percent
- India: 2 percent
System sales growth
- China: 20 percent
- U.S.: 2 percent
- Europe (excluding U.K.) 17 percent
- Asia: 8 percent
- Australia: 9 percent
- Latin America: 17 percent
- U.K: 6 percent
- Middle East/Turkey/North Africa: 21 percent
- Africa: 15 percent
- Thailand: 13 percent
- Canada: 7 percent
- India: 19 percent
When you dig in, Sami says, is when you really begin to decipher the tangible scale and potential of KFC. More than 80 percent of 2023’s growth stemmed from 14 publicly trade franchisees. Of the 30,000 venues counted to start 2024, about 22 percent were built in the past three and a half years.
Again, fitting that into America’s fast-food landscape, those 6,600 or so locations would be good enough to represent the U.S.’s eighth-largest restaurant brand, behind Domino’s and a tick ahead of Pizza Hut.
What’s worth noting as well is 3,791 of KFC’s 29,900 restaurants at year-end 2023 were in the U.S. That domestic arm opened 34 locations and closed 161 as it continues a “Re-Colonelization” campaign that began in 2016 and centers on returning KFC to its quality roots, while also evolving its asset base toward Next Gen builds.
Sami says KFC should be in 150 countries by the end of this year. KFC Global chief development officer, Nivera Wallani, adds the 22 percent stat, in particular, is one that illustrates the tailwinds in KFC’s global business. Not only did the brand open all those restaurants, but it upgraded or renovates somewhere in the range of 4,000–5,000 per year.
India, Thailand, Africa, and Central and Eastern Europe all hit 1,000 during that stretch. Mexico is up to 500. Turkey 300.
In India, to microscope one example, KFC eclipsed that four-digit figure with Devyani International Limited, a Yum! partner for more than two decades. It took the brand nearly 25 years to build its first 500 locations there. The next 500 arrived in less than five. And to spotlight how much whitespace remains, India accounted for 2 percent of KFC’s total system sales last year, which counted $33.9 billion, with same-store sales growth of 7 percent versus 2022. Internationally, KFC’s comps lifted 9 percent in 2023 while the U.S. rose 2 percent. System sales hiked 14 and 2 percent, respectively.
Inside the growth
“It’s something we’re very proud of,” Sami says of reaching 30,000 restaurants. “Our consistency as a global brand and being in the corporate world for over 50 years, we clearly have a model that works. And it works because of the great partnerships we have with franchisees around the world. Many of our franchisees are second- or third-generation types of franchisees who understand what this business is all about.”
Additionally, he notes, KFC’s growth remains fueled by the reality it’s creating wealth for operators and careers for employees. Building north of 8,000 restaurants in the past five years allowed KFC to bring in 200,000 team members, “which is a staggering stat in itself,” Wallani says.
“So, over the past three years, we are the fastest-growing retail brand in the world,” she explains. “And we expect to go ever faster.”
The equation for KFC Global drops into three buckets: strategy, model, and localization. That latter point, as you’d imagine, keeps management busy given the breadth of the chain’s reach. KFC’s localization, Sami says, gets down to the trade zone, not just the country. That’s one of the main reasons it works.
In Latin America last year, KFC targeted new consumers and dayparts using value offers. It also expanded nuggets. Africa boosted breakfast with fresh beverages, including signature coffees. Thailand bumped transaction growth with value offerings across all dayparts.
You can travel the globe and find KFCs that serve shawarma (Romania), Wraps, Twisters, even Poke Bowls. The spice levels don’t stagnate, either.
“If you travel to Africa, Asia, Europe, South America, Australia, U.K., you’ll see the strength of the brand,” Sami says. “And not just in terms of assets, but the consumer loyalty and affinity for the brand as well.”
Wallani adds fried chicken as a category is one of the fastest growing globally in terms of consumption. According to a report by Market Research Future, the worldwide takeout fried chicken market was valued at $6.85 billion in 2023. It’s estimated to scale at a compound annual growth rate of 5.5 percent from 2023 to 2032 and reach a valuation of $10.5 billion.
That’s just takeout.
“Whether it’s bone-in chicken or boneless chicken, I mean, that’s what we do. That’s in our DNA,” Wallani says. “That’s what we’ve done for a really long time.”
Wallani says KFC searches for some critical traits in global partners to guard that standing. No. 1, passion and commitment to grow the brand, “We’re not only a chicken business, but we’re a people business as well,” she says.
The second is capability. That means experience in hospitality or foodservice so KFC can rest assured restaurants are run by world-class operators “every single time,” Wallani notes. And lastly, while not unique to KFC’s model by any means, it does pulse here given the big picture. The brand seeks operators with capital to invest in KFC and drive that growth engine.
Speaking of that, though, a perhaps understated part of KFC’s journey circles back to what’s happened more recently. Wallani says KFC views units through an “80/20 rule.”
“When you consider restaurant design, menu, digital, what we try to do is keep a larger portion of that core to what works for the brand,” she says. “Because we’ve been doing this for many decades. And then, we localize and tweak a little bit for what’s relevant in every business unit or market, or as Sabir said, each particular trade zone.”
In other terms, KFC balances its DNA with a modern tilt, as well as adjusting market-to-market to address local consumer needs.
It’s not only about having franchise partners, but also getting scale to drive KFC’s economic model. “I think the challenge is you need to start planting the seeds and it takes time for the business to get scale and get growth. … Patience is working with local partners and investing for the long run,” Sami says. “Then once you start getting scale, then I think businesses take off in every single market. We are successful in almost every market we go into.”
KFC’s model can look a bit different based on CapEx trade zone to trade zone, from the volume of transactions to cost of commodities. One thing KFC and Pizza Hut boast is marketing-mapping data. Taco Bell International, Yum! announced in Q4, was planning to temporarily slow growth so it could stabilize comps in emerging markets and partner with franchisees to optimize site selection, leveraging the tool KFC and Pizza Hut deploy.
Wallani says market mapping helps identify potential growth, what the brand calls either “whitespace” or “info opportunities.”
“What this data-driven market mapping does, and you can just imagine the volumes of data that go in, whether it’s demographics, competitors, growth expectations, mobile data, anything that you can think of goes into this box and what it spits out is quite amazing,” she says.
Here’s where it evolves: This system doesn’t merely show KFC where to expand—it clarifies the type of asset the company should build for that trade zone; it pieces the jigsaw of Yum!’s innovation engine together.
“So we’re not only building an asset for the guest,” Wallani says, “but also optimizing that asset for our franchisee.”
KFC is one of the global leaders in this category. There is no cookie-cutter box. There are urban inlines, double drive-thrus, stores that fit into stone arches, and a One Bangkok flagship that’s going to be massive in scale and serve a tidal of visitors.
The 30,000th store that opened in Rome showcases double-sided kiosks and digital menu boards.
KFC Latin America markets recently began the rollout of kiosks using Yum!’s proprietary Tictuk platform (it acquired the Tel Aviv-based business in 2021) and plans to triple the restaurant count in 2024. “That’s the way we look at it,” Wallani says. “What’s the occasion? And then what is the right asset to go after that location?”
“It is easy to think of a restaurant as the four walls of the restaurant,” she adds. “And that’s not necessarily a bad thing—that’s where everything happens. But if you start to think about the restaurant as the center of the brand experience, where everything comes to life in the restaurant, it really gives our development team and our development engine the opportunity to work cross functionally across our brand and to accelerate our global strategy, of which development plays a role.”
The occasion for KFC changes globally. Of course, one of the most recognizable reflections is Japan’s Christmas affinity. KFC entered that market in the 1970s. In 1974, it launched the first KFC Christmas campaign, selling a bucket of fried chicken along with a bottle of wine. The original idea came when a foreign customer who visited KFC in Tokyo on Christmas said, “I can’t get turkey in Japan, so I have no choice but to celebrate Christmas with Kentucky Fried Chicken.” A local employee overheard the remark and used it as inspiration to launch the project and the tagline, “Kentucky for Christmas.”
Today, you’ll see Colonel statues dressed in Santa attire and Christmas-exclusive menu items like premium roast chicken that’s hand-prepared and stuffed with cheese and mushrooms. Preorders and reservations can begin as early as late October.
Sami says KFC’s agility, from assets to menu, hasn’t taken a day off. In markets like the U.K., Middle East, and India, it’s a chicken-on-the-bone business. Move to other parts of Europe and sandwiches, strips, tenders, and boneless offerings dominate.
In Australia, the U.K., and North America, drive-thru, and eating while driving overall, is a big phenomenon. Other areas, like India, don’t have many drive-thrus since a good portion of the population don’t drive and the traffic is so congested sites simply aren’t big enough to develop them. So those tend to be more inline hotspots where guests dine-in and enjoy the environment.
“There are many variations of the menu, the design, the team members who work for our stores, the franchisees, each of them has adapted to the local market,” Sami says. “The look and the feel of the brand is very similar, it’s still the KFC marketing elements in terms of the Colonel, the three stripes, the ‘Finger Lickin’ Good’ slogan, the colors are the same as well, the bucket is also very, very familiar in many markets as well.”
The evolution of message and culture
Whether it’s assets or message, KFC Global operates within the “R.E.D.” framework Yum! uses broadly to support a scalable model. It’s defined as a brand that must have something that is particularly Relevant (R) to a consumer need; that is Easy to get (E); and that stands out as Distinctive in the consumer’s mind (D).
There’s an old story of how KFC in South Africa used this guideline to reinvigorate sliding sales. KFC is about five times or so the size of McDonald’s there. About 10 million South Africans reported eating at KFC at least once in the past four weeks, according to a study by Eighty20.
Yet it endured a prolonged dip Yum! couldn’t quite crack. So, the company sent CMO Ken Muench and another strategist over for a few weeks. They dug into culture. Checked out competitors. Sat in consumers’ homes for hours each day. Talked to local professors and artists. What the duo concluded was KFC worked when South Africa’s “Rainbow Nation” movement emerged in a post-apartheid era. The brand’s family position, buckets, and marketing around togetherness helped it capture a broader spirit. And sales exploded. But a new generation ushered in a mindset of individual goal chasing.
That learning inspired a repositioning around “independent success,” and speaking to a fresh core of customers. It’s been a rocketship since.
Wallani says “R.E.D.” for KFC Global boils down to “making the brand easily accessible and then distinctly KFC.”
“What also makes us really unique is the relationship we have with our franchisees and the culture that we built across our organization,” she says. “I would expect if you experienced it, it would feel very different and unique than other brands in our history.”
Sami agrees. Operating in so many countries attracts a plethora of voices, up and down the ladder. “The diversity of teams, franchisees, and employees that we have around the world makes us a really unique place to work,” he says. “… I was recently in Africa, Kenya, and South Africa, the sheer talent of people that we have and the passion for the brand in stores as well as the consumers, it fills your heart with pleasure and pride in the way we operate in those markets.”
Internally, about four years ago, Yum! decided to ratchet up its diversity and inclusion efforts when it came to staffing. Why was it when you visited KFC stores the majority of team members were women, but when you looked at above-restaurant leadership, they weren’t? Or why, in the U.K., most area coaches were Asian, yet not above that tier? “That just provoked the question to say, ‘Hey, wait a minute, there’s clearly some invisible barriers,’” Sami says. “I love the last two to three years we’ve started challenging some of these other paradigms and started unlocking opportunities for people, whether they’re women, people of color, people of minorities or disabilities, or other discrimination factors.”
KFC announced in March it achieved parity between women and men globally across its corporate offices, with women now constituting 51 percent of the collective team.
In terms of what’s next, there aren’t many constraints. Wallani says those 20,000 additional opportunities en route to 50,000 will cover everything from infilling markets like Australia and the U.K. to tackling runway in sub-Saharan Africa. “I would expect that instead of seeing us slow down, you’re going to see us ramp up,” she says. As this unfolds, the brand will continue to lean into community involvement, Sami says. That’s been an anchor of KFC’s development over the decades. In South Africa, KFC runs an “Add Hope” program that feeds children who are less privileged. That’s been going on 15 years and is the largest corporate feeding program in the country. It’s given $54 million from KFC and customer donations since 2009. The locals know it well, he says. “[It’s] seen as a brand that cares for the community,” Sami says. “It creates job opportunities. It creates educational opportunities. It creates wealth for franchise partners and our franchisees there are a part of the local communities. … Consumers see KFC in the holistic sense and say, ‘OK, this is a brand that does care and does the right thing.’”
Wallani adds KFC considers global scale a responsibility. “When it comes to our food, our planet, our people, we are making progress across each one of those to ensure that we are building with responsibility, with purpose, and that we’re not only using our strategy, which is our head and our tools, which is our hands, but we’re also using our hearts as we spread across the world,” she says.
Source: QSRMagazine
