YUM! BRANDS, PIZZA HUT, AND KFC
This case describes the evolution of the global fast-food industry and Yum! Brands, Inc.’s development of the Pizza Hut and KFC franchises worldwide. It focuses on international business risk assessment and develops a model of country evaluation that students can use to analyze international business and market entry decisions in a variety of industries, regions, and countries.
1. Develop skills in industry analysis
2. Develop skills in global industry analysis.
3. Develop knowledge of franchising and the costs and benefits of expanding globally using franchises ...view middle of the document...
Copyright © 2004 by Jeffrey A. Krug of Appalachian State University, Walker College of Business, Department of Management, Box 32037, Boone, NC 28608. Phone: (828) 262-6236. Email: Krugja@appstate.edu. No part of this case may be copied, reproduced, stored in a retrieval system, or transmitted in any form without the permission of the author.
For MBA and Executive MBA courses in strategic management, the case can be used in the beginning of the semester as a means of presenting a framework for industry structure and strategy analysis that the instructor develops throughout the semester. It can also be used in the second-year global & transnational strategy course in the beginning of the semester to introduce international business risk assessment. Alternatively, it can be used at the end of the semester as a review of industry structure, strategy, and international business strategy analysis.
The case is structured around the following themes:
1) Industry analysis (U.S. fast-food industry),
2) Multi-branding and franchising strategies (Yum! Brands, Inc., Pizza Hut, and KFC),
3) International strategy analysis (Pizza Hut and KFC), and
4) Country risk assessment (Mexico, Brazil, and Latin America).
The case is best understood after a class discussion of environmental analysis and business strategy. It is also helpful if students have been introduced to the concept of corporate strategy. The case has enough information to cover one or two sections of class discussion. If the instructor chooses to cover the case in two sections, one section might be used to conduct an industry analysis. A second section might then be used to analyze Pizza Hut and KFC’s business strategies and discuss international business issues.
An alternative use of the case involves breaking the class into groups of four to five students and assigning one discussion question to each group at least one class period before the case is presented. When students return to class the following session, students can be broken into their groups for ten to fifteen minutes, during which time they formulate a response to their assigned question. The remaining time may then be used for short student presentations. I sometimes ask a representative from each group to give a five to eight minute response to his or her group’s question and interject periodically to make sure that the questions are tied together correctly.
A third use of the case is to ask groups to examine the Latin American market (or more specifically the Mexican and Brazilian markets) and analyze the costs and benefits of expanding further in Mexico versus expanding into other areas of Latin America such as Brazil. This also makes a good individual or group writing assignment. It can also be used for a semester paper.
The beginning sections of the case can be used to conduct an in-depth industry...