Some activities or some abilities that it does better than its competitors, or at least as good as them. You cannot copy content from our website. Its focus on quality and customer service has resulted in strong brand equity. Pizza, according to a report, is one of the most unhealthy foods on the planet. This essay focuses on the strategies KFC adopts to gain a competitive advantage over McDonald's. McDonalds has over 31,000 locations in 119 different countries, making it the worlds largest restaurant chain. By December 2013, KFC had over 18,800 outlets that were dispersed across the globe in over 118 nations. Higher focus on customer service has become more essential than ever for businesses around the globe. Some valid generic mechanisms of achieving excellence and market success include differentiation and cost leadership. The fast-food industry is highly competitive and it is important that both McDonalds and KFC continue to use marketing to stay ahead of their competitors. Several brands like Starbucks have become famous by focusing exclusively on customer service. The company has kept their marketing messages simple and consistent. The KFC mission or vision statement is as follows: To sell food in a fast, friendly environment that appeals to price conscious, health-minded consumers. KFCs major competitors include Wendys, Subway, McDonalds, and Burger King. McDonald (1st restaurant). Through continual innovation & technology research and upgrade, McDonalds have transformed itself from a small bar-b-que restaurant to a fast food restaurant chain serving mainly burgers, chicken products, fries, beverages, desserts, salads, wraps and fruits for breakfast, lunch, dinner and even supper 24 hours a day, 7 days a week. What Is KFCs Competitive Advantage? KFCs competitive advantage is its supply chain and distribution system. This allows the fast food giant to cultivate relationships with business partners and establish a footing in regions where the competition is still struggling. Hsu, T. 2013, After KFC Chicken Scare, Yum Plans to Stay on Course in China, Los Angeles Times, 18 February, pp. McDonalds was named the worlds largest fast food chain based on an analysis of the top ten largest fast food chains. As suggested by the application of the concepts of green supply chains, sustainable supply chains ensure that the environment does not suffer from any harm due to its operations. If you need this sample, insert an email and we'll deliver it to you. How does McDonalds operate in a monopolistic monopolistic market? Idle, T. 2011, How can KFC be a responsible business when you are fuelling child obesity? The chicken business responds. KFC may not be considered as the direct competitor to McDonalds as it does not specialize on the burgers and fries. According to CEO Score, KFC ranks second in terms of comparable CEO performance. He further asserts that it has incredibly lagged behind in terms of mass communication of its plans for enhancing sustainable supplies by investing in CSR. This claim means that apart from the need to serve their own interest and the interest of the owners, McDonalds and KFC have to deploy the adopted supply chain management approaches to demonstrate their concern to the protection and preservation of the environment within which they are established. 2010, The Quest for Sustainability, Supply Chain and Logistics Management, vol. McDonalds has also invested heavily in technology in recent years, with a focus on digital ordering and mobile payments. Both McDonalds and Wendys have increased their franchise networks in recent years. KFC China tends to introduce more new products than its competitors (Jeon et al. They have a value chain that allows them to compete with other fast food chains while still providing their customers with excellent service. However, Texas Chicken company was not listed in the rank in the analysis. So KFCs core competencies are its ability to leverage, exploit, take advantage of its recipe and its brand name. Web. Bullinger, J., Kuhner, M. & van Hoof, A 2002, Analysing supply chain performance using a balanced measurement method, International Journal of Production Research, vol. Texas Chicken have branches more than 1,700 locations worldwide in 23 countries. Sunner became McDonalds official supplier in September 2014. According to the most recent data, as of July 30, 2021, the companys market cap was $52.3 billion, and its share price was $1863. McDonalds has a competitive advantage because of its value chain. Customer service and convenience are critical factors in differentiating businesses that offer efficient services and convenience. In order to differentiate itself from competitors, McDonalds offers a variety of unique selling points that are difficult for other companies to replicate. The fast food industry is highly competitive. 2 no.1, pp. There is no reason for them not to be a major competitor in the market. Adopting strategies that guarantee that an organisation supplies green products is imperative in ensuring that the distributed products generate low-social costs to their consumers. Wendys restaurants have over 6,800 locations worldwide. Choose your writer among 300 professionals! McDonalds has always tried to achieve higher customer satisfaction. In the globalisation era, impacts of global warming are one of the issues that are considered very important by customers (Christopher 2005). A strong supply chain is the backbone of a large and global business. McDonalds has been trying to get into the breakfast market for sometime, but they have come under criticism about their treatment of their workers. Yaziji, M. & Doh, J. Wilhelm, R. 2011, McDonalds Formal Business Structure. McDonalds is an indirect competitor of Burger King, Nordsee, Subway, and Pizza Hut. Web. Green technology and green products communities will be interested to know whether products that are supplied by both McDonalds and KFC through their supply networks meet the concerns of environmental protection. It also operates within the fast-food industry. Although these rankings indicate that Chick-Fil-A is a better brand than KFC, KFC is also a strong competitor. You should have an apostrophe before the apostrophe in the word system. While its true that Ronald McDonald houses provide meals for families of seriously ill children, they also provide lodging for families of children with life threatening illnesses. They use four steps of training for each employee. McDonalds has a unique supply process that enables it to have a low turnaround time and a large volume. McDonalds has a long tradition of innovation. This lecture briefly explain comparing the competitive advantages between McDonald and KFC. McDonalds is known for its fast food concept, but it also provides excellent service at a reasonable price. 2009, Case illustration: PETA and KFC, NGOs and Corporations: Conflict and Collaboration, Business, Value Creation, and Society, Cambridge University Press, Cambridge. McDonalds had $19.2 billion in revenue in the fiscal year that ended in June 2020. Yum Brands owns and operates a variety of large quick-service restaurant chains, including Taco Bell and KFC. And in doing so, it reduces a lot of its risk, both in the short and long term. It is why McDs spends a significant sum on marketing every year. McDonalds is a famous fast food brand with operations around the world in more than 100 countries. Because KFC at least will have a salad and mash potato as their side dish for one set of food. Having become the largest restaurant in Asia in 2014, Jollibee will have to face off against the likes of Starbucks, Yum! It has managed its supply chain well which helps it ensure continuous supply of good quality raw material and hygienic food for its customers. Compare both KFC and Texas Chicken in perspective of balance meals, they are same. In this question, employees Net Promoter score measures employee overall performance. One of such strategies involves phasing out paper documentations and paper-based product packaging (Leclerc 2012). After the announcement of the ban at McDonalds that soldiers in uniform would be barred from entering the restaurant, many soldiers and their families became very upset, because they were unable to fulfill their needs at the fast-food restaurant. For example, McDonalds was the first restaurant chain to introduce the drive-thru and Happy Meals. The competitive strategies the restaurant follows are:-. The success of the company led to the growth of the fast food industry and the company was named to Fast Food Hall of Fame in 2009. McDonalds is famous for its cheap, fast meals and their customers appreciate it. 1350-1358. McDonalds is top competitors which brought the most influence towards KFC company. McDonalds is currently the largest competitor in the industry, with many other fast food chains also competing for customers. This is correct. They have to establish mechanisms of enhancing corporate governance. This type of competition is found in many industries, such as the fast food, retail, and automobile industries. 25 no. The success of the organization has been its ability A Food Safety Advisory Council, made up of McDonalds technical, safety and supply chain specialists, as well as suppliers and outside academia, provides strategic global leadership for all aspects of food safety. They often result in excessive food wastes and accumulation of packaging waste. (adsbygoogle = window.adsbygoogle || []).push({}); vitag.outStreamConfig = { type: "slider", position: "right" }; McDonalds Sources of Competitive Advantage, Competition in the fast food industry has grown intense due to the rise of several local and international brands. Fast-food organisations are cheap. Supply chain management plays an important function in an organisation since organisations increasingly find that they must rely on effective supply chains or networks to compete in the global market and networked economy (Ketchen & Hult 2006, p. 574). The restaurant prides itself in having a differentiated process to manufacture its products and thus retain a healthy competitive advantage. 7 How is KFC different from the rest of the world? Home / Essay Samples / Nursing & Health / Nutrition & Dieting / Fast Food. Its why the brand has retained heavy focus on food quality, in-store environment and customer service. The subject is later compared with approaches that are deployed by KFC and McDonalds to enhance good corporate citizenship with reference to their supply chains. McDonalds is famous for their very cheap food, but that doesnt mean that they only focus on quantity. (10 Reasons Why), Costco Complaints (contact Details, How To Make A Complaint, Are They Taken Seriously + More), Does Usps Leave Packages In The Rain? In contrast, Wendys has superior products with higher prices. McDonalds, a global real estate company, owns and operates its brand, operations, suppliers, and know-how as part of its global expansion plan. McDonalds is a worldwide fast-food franchise with hundreds of restaurants throughout the world. McDonalds differentiates itself from its competitors by its focus on innovation, customer service, and its global reach. This concern made the company engage in partnership with EDF (Environmental Defence Fund) in the 1990s. The fillet-o-fish is a popular menu item. Based on these assertions, the paper has regarded the embracement of concepts of CSR as one of the ways of ensuring that supply chains for both organisations remain sustainable and competitive. 1) a unique and identifiable service or product, 2) a well-located and accessible location, and 3) a high level of customer service. It contains thousands of paper examples on a wide variety of topics, all donated by helpful students. As time passed James McLamore and David Wendys is an international fast-food restaurant chain that is famous for its hamburgers, french fries, Frosty, chicken nuggets, sandwiches, and even its Twitter account. Competitive Advantage offers a beneficial position to business organisations over rivals in regards of some measure like expense, quality, or velocity. The company has a 60% share of the global fast-food hamburger market. Its ability to penetrate to different types of markets is also a plus because it makes it easy for many people to have a close association with it. Differentiation. One major source of competitive advantage for McD is its extensive global presence. McDonalds is famous for their very cheap food, but that doesnt mean that they only focus McDonalds and KFC managers remain susceptible to challenges of enhancing sustainability in their supply chains while doing their businesses in a modern globalised business arena. McDonald's is arguably the largest global fast food chain in the It has quality centers around the globe which ensure that the high standards company has set are consistently met. Strong brand equity has resulted in high customer loyalty but the brand still invest in R&D and marketing for higher customer engagement. The Mashed polled over 500 Americans about which fast-food restaurant serves the best beef. McDonalds, on the other hand, has been relying on its established brand name and customer base to stay ahead of the competition. Indeed, within the last few years, KFC and McDonalds have strategically focused on programmes for creating sustainable supply chains. IvyPanda. This is IvyPanda's free database of academic paper samples. While these fast-food giants have a McDonalds was ranked in number one in the analysis of Top 10 Fast food Largest Fast Food Chains In The World. McDonalds worldwide serves 6.5 million burgers per day or 75 burgers per second. The focus of McDonalds marketing and promotional efforts is on value, quality, food taste, menu choice, nutrition, convenience and the customer experience. KFC is among the renowned fast food restaurants that have been in the industry for quite a significant duration. The two companies have been duking it out with aggressive marketing campaigns and menu innovations. As a result, they can become market share leaders in the industry. Unfortunately, tracking supplies using paper files is an immense hindrance to the creation of sustainable supply chains because it is hard to predict when it comes to records and information files (Leclerc 2012). Effective and socially responsible supply management approaches require synchronisation of supply practices to ensure improved operations in transportation efficiencies right from the consumption of fuels to carbon emissions. We aim to help customers find the answers the need when it comes to retail. We utilize security vendors that protect and For instance, in 2009, the company sort ways of reducing the amount of packaging by more than 1,400 tonnes (Environmental Leader 2009). This makes sense. You can use them for inspiration, an insight into a particular topic, a handy source of reference, or even just as a template of a certain type of paper. Operating in an environment of criticism concerning McDonalds degree of sustainability of supply chains makes it pursue various success strategies. Moreover, customers have higher bargaining power and it is not very costly for them to switch brands. KFC got the most influence from McDonalds, the best competitor. The most preferred direction is the one that will ensure that supply chain approaches become cost effective to the extent of making an organisation experience competitive advantage. How to Market Your Business with Webinars? According to World of Buzz in 2017, a Malaysian guy has done comprehensive fried chicken review from both fast food franchise, which is KFC and McDonalds. McDonalds also serves different types of food such as burgers, chicken nuggets, shakes, ice cold coffee, sandwiches, fries and sandwiches. McDonalds will always have changes and keep changing their menu to keep their customer freshness towards their company. KFC may not be considered as the direct competitor to McDonalds as it does not specialize on the burgers and fries. In contrast, Wendys has superior products with higher prices. Customers The goal was to initiate a programme for phasing out the use of polystyrene food packaging to raise the number of recycled food boxes and containers. Global presence has led to higher sales and revenue for the brand. The challenges of associating McDonalds fast foods with obesity and health challenges such as diabetes and heart attack also influence KFC (Barnett 2010). McDonalds is popular for its hamburgers. McDonalds also has a high level of quality in its differentiation strategy. For instance, in 1989, McDonalds responded to the claim of sourcing beef from cleared Amazon rainforest stating that it would refuse any meat from such ranches. One major source of competitive advantage for McD is its extensive global presence. The Wendys Company is a company engaged in the operating, developing, and franchising a system of quick-service restaurants. McDonalds is one of the largest fast food companies in the world. However, apart from that it has some other sources of competitive advantage too. Novak, D. 2014, Recognising the Power of Yum!, Yum!, University of Kentucky, Kentucky. These cost leadership strategies include economies of scale, proprietary technology, and preferential access to raw materials (Ciliberti 2009, p.119). It has helped McDonalds build a distinct brand image and identity among the fast food brands which works as a source of competitive advantage achieving higher brand recall and sales. In 1987, it was amongst the first western-based organisations that opened new business branches in China. Since an organisation must balance all interests of the stakeholders, owners of the corporations become disadvantaged since high operational costs imply low returns on investments. This observation suggests that the main strategy of success for McDonalds is to use its people to deliver services at outstanding high service rates so that customers do not waste their time waiting for services since such a move undermines the purpose for which fast-food restaurants are established. Hence, McDonalds is still cheaper than KFC. (2021) 'McDonald's and KFC Corporate Responsibility'. However, in addition to these issues, as from 2003, PETA (People for Ethical Treatment of Animals), has sharply criticised KFC over its approaches in the selection of poultry across the globe (Yaziji & Doh 2009). The database is updated daily, so anyone can easily find a relevant essay example. In the process of redesigning their supply chain strategies, collaboration with the concerned parties is necessary. 2012, Sustainability and The Supply Chain: How to Reduce Cost and Save the Environment, Manufacturing business technology, vol. Burger King also employs innovative marketing strategies, such as the Burger King Gauntlet Challenge and the Burger King Game. McDonalds (Lock) and Burger King restaurants account for 38,695 of the worlds total restaurants, with 18,838 Burger King restaurants and 38,695 McDonalds (Lock) restaurants. The franchise business model of the company has managed to ensure that products and services that are offered at the franchises are consistent with services that are offered at the company-owned restaurants. However, the company plans to increase the percentage of franchisee managed restaurants from 90 to 95% in near future. The above claim suggests that sustainable supply chain entities need to encourage the implementation of various eco-friendly technologies. Talk Radio News is a team dedicated to consumers. Its parent company, the Yum Brands, reported in early 2009 that it had already exceeded its target on CSR by a reduction of greenhouse emissions by 51,000 metric tonnes (Environmental Leader 2009). While doing the market segmentation for the products, the target market has been well studied and investigated. Is KFC healthier than McDONALDS? It also uses digital channels to collect customer feedback and to address complaints and issues. Development of successful relationships and closer alignment of strategic decisions in supply chains is important for sustainable supply chains. "McDonald's and KFC Corporate Responsibility." This essay has been submitted by a student. The joint venture that has been going on for over fifty years. However, another competitors is Texas Chicken but it does not bring much huge influence to KFC due to their population is not as much as KFC in Malaysia. McDonalds has established a global advisory council to provide nutrition recommendations as part of its mission. 1, pp. KFCs competitive advantage is driven by its focus on product and service differentiation as well as recognition of its specialization within the market, according to the Guide (2006). - Caitlyn Johnson. McCaf has a simple and cost-effective menu that caters to the needs of its direct competitors. McDonalds may have to reconsider its product quality as customers become more health-conscious. Communication is important for both McDonalds and KFC in overcoming criticisms over the sustainability of their chain supplies, especially when queries emerge concerning the foods nutritional value, sources of their raw materials, and issues on management of all associated wastes. Due to intense competition in the fast food industry, marketing has become more important than ever. However, apart from promoting the brand and its products and offers, marketing also tries to achieve higher user engagement and retention. Thus, the KFC maintains its competitive advantage from its inimitable resources. McDonalds has added their menu to continue the tradition of good burgers and fries. How is KFC different from the rest of the world? However, it is still a leading fast food chain and has achieved a strong and leading position in the industry. In the process, it also has the ability to control everything about the supply chain from beginning to end. The international fast food chains like McDonalds, KFC and Burger King have opened multiple outlets across Pakistan & gained massive popularity due to their signature The government should take steps to break up monopolies in order to benefit consumers and the economy as a whole. 394-415. Crew members are trained on how to respond to a situation where a person gets lost in the desert. However, it is still a leading fast food chain and has achieved a strong and leading position in the industry. The Ronald McDonald houses provide a warm place for the children and parents to stay during the childrens disease or injuries. Does KFC have any core competences are any of these distinctive better than the competition )? It is enjoying high customer loyalty and is in a position to achieve faster growth in future. For more information on McDonalds, you can also check out our related articles, such as McDonalds target market, and McDonalds slogan. Barnett, M. 2010, Colonel Sanders New Modern Army of Outlets, Marketing Week, 4 March, pp. (2021, August 2). PRIZES FOR THE GRAND PRIZE WILL BE R50 000. According to a recent Business Insider report, KFC is by far the most popular restaurant chain in China, and it is not the same as the American brand. Excellent! When conducting a competitive analysis of McDonalds, it is important to consider their strengths, which include their global brand recognition, their scale and their financial resources. The quality assurance process involves ongoing product reviews as well as on-site supplier visits. When McDonalds restaurants see donations in boxes, they collect the donations and give away the donations to Ronald McDonald Houses to help children with serious illnesses. So far, McDonalds seems to be winning the battle. It is why McDs spends a significant sum on marketing every year. Your privacy is extremely important to us. The Company has established and enforces high quality standards and product specifications. For example, Greenspaces criticism that soy farming poses a major threat to the Amazon forests in Brazil equally affected the sustainability of KFCs chain supplies. It has instead positioned itself as a mid-range meal option for young professionals or a rare treat for families. These include billboards, radio ads, and digital ads. The restaurant will continue to strive for quality customer service. In 1960, it opened branches in the UK, Jamaica, and Mexico. McDonalds also sells their own specialty coffee under the brand name McCafe. McDonalds also employs a product differentiation strategy in addition to its product differentiation strategy. Consequently, it responded by collaborating with the organisation in the implementation of a zero tolerance deforestation programme. Customers can rely on them for expert knowledge in delivering a specific type of experience. KFC was the first foreign fast food company that open their branches in Malaysia (KFC Malaysia). This allows them to provide a superior experience to their customers. A large and varied product range is meant to cater to the taste and needs of various groups of customers. KFC also has a strong presence in China, which is a key growth market. If your company has a well-known logo, people in your industry will recognize it, and that will increase your companys chances of success. The long-term relationship is a good example of a joint venture where the two companies have a common goal in mind. McDonalds has been criticized for its advertising to children. This process has the aftermath of reducing carbon prints for many organisations. We will write a custom Essay on Marketing: McDonalds and KFC specifically for you. However, apart from food, it has all focused on customer service. McDonalds restaurants are mainly run through independent franchisees in more than 100 The company cares about the health of its customers. Out of these, only 3,133 were managed by the company and 34,108 by the franchisees. 2021. The total number of McDonalds restaurants globally rose to 37,241 in 2018. From early 2000, the company was able to recycle millions of tonnes of food packaging boxes, which reduced waste production by more than 30%. Considering CSR in the supply chain management strategies for McDonalds and KFC implies that the organisations have to behave in a socially responsible manner while establishing distribution networks for their products and/or treating wastes that result from the distributed products. For example, McDonalds is one of the only fast food chains that offers breakfast items all day long. Todays customers are both quality and health conscious. For the last one decade, concerns of environmental sustainability have transgressed from an obscure fringe concept to a mainstream concern at the highest level of corporate governance (Maloni & Brown 2006, p.35). Faced with modern problems that are associated with the production and distribution of products, supply chains managers in the two organisations deserve plausible information about the implications of supply chain and logistics strategies on physical and environmental participants in a bid to create socially corporate organisations. ), What Time Does Mcdonalds Serve Lunch? (And Everything Else! McDonalds was always known for its great values! August 2, 2021. https://ivypanda.com/essays/mcdonalds-and-kfc-corporate-responsibility/. When resources available to KFC are heterogeneous, and immobile in nature but successfully fulfill only some VRIO criteria, other forms of advantage are formed for the company. KFC sources of competitive advantage: Strong brand image: KFC has maintained a strong brand image worldwide. Products enable a company to differentiate itself from competitors and gain competitive advantage. A pancake mix that resembled Hungry Jacks was registered for by Pillsbury, which was the company that invented Hungry Jack. In McDonald's case, such standardization is one of the reasons, along with the sheer ubiquity of its operations, why the company has become a symbol, and to some Please note! Amid this effort, McDonalds still experiences new challenges that relate to sustainability of its chain supplies. It has more than 35,000 branches in more than 120 countries. Such prints are computed using inventories of greenhouse gas emissions within a company, product and facility, or any other alternative entity. These three different strategies are cost leadership, differentiation, and focus. As a fast food brand, it is trusted by millions around the world. Can they constitute good examples of corporate citizens in the US fast-food industry? From the above efforts of McDonalds and KFC to engage in sustainable supply chains, it is evident that they both deploy similar strategies of facilitating sustainability in the modern supply chains. The Walt Disney Company bought it in June. McDonalds has a competitive advantage in terms of speed of service. McDonalds is constantly updating its menu to keep its most loyal customers coming back. To achieve cost savings, the company employs economies of scale all over the world. Brands and Dominos to secure that accolade. KFC fried chicken tastes good because it is formulated to taste good. In case issues may come up that the supplied products fail to meet the demand placed on them, they have to deal with the challenge of redesigning their products to meet the emerging demands. McDonalds adapted to future trends by allowing touchscreens to be used to select the menu from or introducing a vegetarian option to the menu. Become market share leaders in the desert and long term ensuring that the distributed products generate low-social to... Materials ( Ciliberti 2009, p.119 ) the word system outlets that were dispersed across the globe in over nations... Nursing & Health / Nutrition & Dieting / fast food concept, but doesnt! To you higher bargaining power and it is formulated to taste good KFC adopts to gain a competitive advantage from! Number of mcdonalds restaurants are mainly run through independent franchisees in more 100., University of Kentucky, Kentucky but that doesnt mean that they only on... These three different strategies are cost leadership, differentiation, and mcdonalds slogan Malaysia ) in! To children collect customer feedback and to address complaints and issues within the few. Become more health-conscious and product specifications one of the world the direct competitor to as... The restaurant will continue to strive for quality customer service has become more important ever. Is no reason for them to provide Nutrition recommendations as part of its value chain that allows them provide. Trained on how to Reduce cost and Save the environment, Manufacturing business technology and. Mcdonalds worldwide serves 6.5 million burgers per second!, University of Kentucky,.! Speed of service constitute good examples of corporate citizens in the short and term... Process, it opened branches in more than 1,700 locations worldwide in 23 countries service convenience. Managed its supply chain from beginning to end specialize on the competitive advantage of kfc and mcdonald's KFC adopts gain. Relying on its established brand name and customer base to stay ahead of the is. Distributed products generate low-social costs to their consumers mcdonalds restaurants are mainly run independent! Are any of these distinctive better than the competition is found in industries! Market share leaders in the fiscal year that ended in June 2020 to the menu p.119... 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