StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Yum Brands China Business Strategy - Research Paper Example

Cite this document
Summary
Yum Brands-China Business Strategy
Introduction
Yum Brands Inc., being an international Corporation, has undertaken to put in place a global business strategy where strategies to enter and expand its operations in China have been focused upon. …
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER97.8% of users find it useful
Yum Brands China Business Strategy
Read Text Preview

Extract of sample "Yum Brands China Business Strategy"

?Running head: Yum Brands-China Business Strategy Yum Brands-China Business Strategy Insert Insert Insert 01 February 2012 Yum Brands-China Business Strategy Introduction Yum Brands Inc., being an international Corporation, has undertaken to put in place a global business strategy where strategies to enter and expand its operations in China have been focused upon. Yum Brands Inc. entered the Chinese market in 1987, considering the fact that during this period, the Chinese economy had rapidly grown after its liberalization. The company was one of the early players in the Chinese restaurants’ business, which has enabled it to establish its operations in the Chinese market firmly. The company’s entry into China has provided Chinese consumers with a new and unique dining experience, where they get customized and clean ambiance service. The Yum Brand Inc. business strategies have focused on menus that include both western and local consumables, with focus being directed towards offering customer preferences in each province. Business Strategies The business strategy of Yum Brand Inc. in China encompasses providing a variety of consumables, customer preferences, franchise relationships, and employing locals to key positions of the company. The company focused on strategies of employing locals in its key positions alongside delivering services according to customer preferences, which vary from one province to another. The company also has established franchise relationships and built its own logistics and distributions network. Moreover, the company has been keen on its business strategy of developing new markets through establishing widespread restaurant chains in China division to increase its market share. Apparently, mainland China is Yum Brands’ leading market according to worldwide restaurant development (Enz, 2010, p.945). Internationally, the company has built a vibrant global entity by focusing on key business strategies such as establishing leading brands all over the Chinese market, driving aggressive expansion of the international market, and building franchise value and long-term shareholders for industry needs. The Company has built a unique business culture that is filled with exciting opportunities and energy for both employees and customers. According to executives, the company believes in the people, encourages ideas from all and sundry, and trusts in positive intentions of its people. Through this, the company has been able to bring about diversity in style in its business operations and consumables, considering that customer needs and preferences can be best met through diversity. In a bid to establish a huge market for base in the Chinese market, Yum Brands Inc. in Beijing sought to take over the Little Sheep Group limited, which operates a popular chain in China. This move is among the many global business growth strategies, which have seen the company penetrating and establishing its groping in the largest Chinese market. The Chinese market of casual dining was seen to grow expansively, which befits the Yum Brands move to grow beyond the chicken and Pizza market being concentrated on by Pizza Hut outlets and KFC. The company’s stake holdings in the Little Sheep limited operations have enable massive growth on foodservice operators’ growth. Mergers and take over strategies being put in place by the company have propelled its market penetration in China to greater heights, although government regulatory measures have limited its international bid. The Little Sheep Company has contributed to Yum Brand Inc’s great leap forward in winning in China market due to its widespread operations of the cuisine where patrons are able to cook meat and vegetables themselves. China’s great market embraced such kind of an idea with enthusiasm, and thus enabling Yum Brand Inc. to take root into the market. The market has since grown tremendously, with the company adding up its popularity by introducing consumables such as seafood-topped pizza and fried shrimp that embrace the Chinese style. The company’s menu modification is among the most successful business strategies under implementation. The Yum brands have also broken into the Chinese market through its business strategy of customizing their consumer menus to fit local tastes in China. This strategy has enabled the company to penetrate into the market with ease, irrespective of the unique local needs. Moreover, the strategy has not only customized tastes, but also formats of its stores to fit consumer behavior and changes in consumer preferences (Harvard Business Review, 2011). Yum Brand Inc. has been able to tap into Little Sheep’s market network through diversification in Chinese and Asian cuisines that have been popular in the Chinese market for some time. However, the company needs to buy into the foreign market, considering that it faces localization challenges. This is essential if the company is to stabilize its operations in the Chinese market, given the fact that restaurant business in China is growing with increases in personal income. Yum Brands Inc. global business strategy has focused on conglomerates, which has enabled it to establish itself in huge market such as China through owning outlets and brands. Compared to the US and European markets, the Chinese market offers growth opportunities to international businesses. Yum brands have sought to build dominant brands of restaurants in china to pursue a global growth strategy through organizing Yum China into three divisions comprising KFC Taiwan, Thailand, and mainland China. The company is using divisional management structure strategy, where the international division and the China division operate as enterprises that are independent of each other (Enz, 2010, p.302). The company has also shifted its business strategy focus to hot pot restaurant, which has rapidly gained big time popularity, particularly among office workers in major cities in China being led by Beijing. More so, Yum Brand Inc. operates quick service restaurants, which are a major attraction to time conscious clients such as office workers. Yum Brands Inc. has put in place business strategy plans to focus on expansion and development of Taco Bell, Pizza Hut, and KFC chains in China. Franchise ownership and operations business strategy such as KFC has definitely been an effective strategy used by the company to penetrate the Chinese market. Conclusion Yum Brands Inc. stability of operations in China has been supported and made possible by the company’s global business strategies used both in the past and currently. The company focuses on quick service restaurant over widespread outlets through various concepts such as the KFC Taco Bell and Pizza Hut restaurant chains. In addition, the company also puts in place other concepts such as LJS and A&W in the Chinese market. The Company also operates licenses and franchises of widespread restaurant systems that prepare, package, and sell food consumables according to customer needs and preferences. More so, the Company undertook to own non-controlling interests of companies running their operations in the Chinese markets. Such non-controlling interests include the Little Sheep Ltd and the Hot Pot restaurants. More importantly, the Yum Brand Inc. used division strategies, with particular emphasis on the China division, among other divisions such as International division. References Enz, C.A. (2010). Hospitality Strategic Management: Concepts and Cases. NJ: John Wiley and Sons. Enz, C.A. (2010). The Cornell School of Hotel Administration Handbook of Applied Hospitality. NY: SAGE Publications, Inc. Harvard Business Review. (2011). Harvard Business Review on Thriving in Emerging Markets. Boston: Harvard Business School Publishing Corporation. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Yum Brands China Business Strategy Research Paper”, n.d.)
Yum Brands China Business Strategy Research Paper. Retrieved from https://studentshare.org/business/1442012-yum-brands-china-business-strategy
(Yum Brands China Business Strategy Research Paper)
Yum Brands China Business Strategy Research Paper. https://studentshare.org/business/1442012-yum-brands-china-business-strategy.
“Yum Brands China Business Strategy Research Paper”, n.d. https://studentshare.org/business/1442012-yum-brands-china-business-strategy.
  • Cited: 0 times

CHECK THESE SAMPLES OF Yum Brands China Business Strategy

Pizza Hut Franchise

The Italian Pizza is launched in the UK 1998 Pan Pizza is relaunched as Grand Pan in the UK 1997 PepsiCo decided to focus on their (sic) drinks business.... brands Inc.... 2002 Tricon Global becomes yum!... A & W and Long John Silver's join the yum brand....
16 Pages (4000 words) Essay

Kentucky Fried Chicken in China

business Your Instructor KFC in China YUM!... The improvement of KFC in China is a clear indication that knowing a business environment is very important.... This is because the KFC brands have great force in China as they strive to achieve their goal and increase the business performance.... The core part of improving the business is by understanding the STEP analysis.... STEP analysis of business is an environmental model that stands for Social, Technological, Economic and Political factors....
5 Pages (1250 words) Essay

Strategic Hospitality Management of Yum Brands

hroughout the company's course of operation, the implied mission is to be the world's largest restaurant in the world through its co-branding strategy that is, putting two of its restaurants together in one locality in order to appeal to a larger market. ... This strategy takes into account the stockholders of the company.... Co-branding strategy which combines two or three brands in each location.... These objectives fail to take into account all the shareholders of the business organization....
8 Pages (2000 words) Case Study

The Impact of Corporate Culture on Marketing Strategy: KFC in China

This case study is related to corporate culture of KFC China and its related effect on marketing strategy of the business.... The researcher aims to assess and evaluate the effects and purposes of different marketing strategies while conducting a case study on KFC, china....
16 Pages (4000 words) Case Study

The Brand Strategy of Gucci

This research “The Brand strategy of Gucci” reviews the current literature about branding and based on the common premise that a brand does not exist in the physical world, it is a mental construct; and that it is more than just a logo.... This study includes an analysis of sex as communication and marketing strategy.... This study includes a comprehensive literature review of branding as a marketing strategy, and then a discussion of what is branding, and the social equity of Gucci branding....
39 Pages (9750 words) Dissertation

The International Business Environments of Franchising

Franchising is using another firm's successful business strategy to develop one's business.... Its main operation strategy has been to establish a franchise (Cyrek, 2009).... The following paper under the title 'The International business Environments of Franchising' focuses on the subway sandwich which is a product of the American Restaurant franchise known as the Subway.... The brand of one company is therefore used to sell by another according to a business agreement between the two (Anttonen, 2005)....
2 Pages (500 words) Term Paper

Competitive factors of YUM Brands (MNC) to succeed in the business

om/node/4316138Uggla, H & Filipsson, D 2009, Business and Brand Strategy: A Framework for Integration, The Icfai University Press, The Icfai University Journal of business strategy, 6 (2), pp.... yum brands, based on the co-branding strategy have built a vibrant global business by focusing on four key growth strategies (Uggla & Filippson, 2009): They are building leading brands in China in every significant strategyThey undertake aggressive international expansion and build strong brands everywhereThey have been able to dramatically improve the US brand positions, consistency and returnsTheir growth has helped drive shareholder value and franchise value....
2 Pages (500 words) Research Paper

Market Position Analysis of Yum Brand

yum brands have experienced growth by focusing on the foreign markets such as China, India, and Brazil to name a few.... Though it is facing the decline in sales and profits, reports have suggested that the macroeconomic environment has always remained strong for the yum brands, especially in the overseas markets (Cho, 2012).... The company anticipates that the in the next 8-10 years, the rising incomes will continue to unfold and will allow millions of people to afford fast foods from yum brands (Cho, 2012)....
27 Pages (6750 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us