Chipotle was established in 1993 with the idea to demonstrate that fast food does not have to come with the typical “fast-food” experience. Chipotle’s niche market prefers high quality ingredients….
Colonel Harland Sanders, born September 9, 1890, actively began franchising his chicken business at the age of 65. Now, the KFC® business he started has grown to be one of the largest quick service food service systems in the world. And Colonel Sanders, a quick service restaurant pioneer, has become a symbol of entrepreneurial spirit.
More than a billion of the Colonel’s “finger lickin’ good” chicken dinners are served annually. And not just in North America. The Colonel’s cooking is available in more than 80 countries and territories around the world.
When the Colonel was six, his father died. His mother was forced to go to work, and young Harland had to take care of his three-year-old brother and baby sister. This meant doing much of the family cooking. By the age of seven, he was a master of several regional dishes.
At age 10, he got his first job working on a nearby farm for $2 a month. When he was 12, his mother remarried and he left his home near Henryville, Ind.
, for a job on a farm in Greenwood, Ind. He held a series of jobs over the next few years, first as a 15-year-old streetcar conductor in New Albany, Ind., and then as a 16-year-old private, soldiering for six months in Cuba.
After that he was a railroad fireman, studied law by correspondence, practiced in justice of the peace courts, sold insurance, operated an Ohio River steamboat ferry, sold tires, and operated service stations. When he was 40, the Colonel began cooking for hungry travelers who stopped at his service station in Corbin, Ky. He didn’t have a restaurant then, but served folks on his own dining table in the living quarters of his service station.
As more people started coming just for food, he moved across the street to a motel and restaurant that seated 142 people. Over the next nine years, he perfected his secret blend of 11 herbs and spices and the basic cooking technique that is still used today.
Sander’s fame grew. Governor Ruby Laffoon made him a Kentucky Colonel in 1935 in recognition of his contributions to the state’s cuisine. And in 1939, his establishment was first listed in Duncan Hines’ “Adventures in Good Eating.”
In the early 1950s a new interstate highway was planned to bypass the town of Corbin. Seeing an end to his business, the Colonel auctioned off his operations. After paying his bills, he was reduced to living on his $105 Social Security checks.
Confident of the quality of his fried chicken, the Colonel devoted himself to the chicken franchising business that he started in 1952. He traveled across the country by car from restaurant to restaurant, cooking batches of chicken for restaurant owners and their employees. If the reaction was favorable, he entered into a handshake agreement on a deal that stipulated a payment to him of a nickel for each chicken the restaurant sold. By 1964, Colonel Sanders had more than 600 franchised outlets for his chicken in the United States and Canada. That year, he sold his interest in the U.S. company for $2 million to a group of investors including John Y. Brown Jr., who later was governor of Kentucky from 1980 to 1984. The Colonel remained a public spokesman for the company. In 1976, an independent survey ranked the Colonel as the world’s second most recognizable celebrity.
Under the new owners, Kentucky Fried Chicken Corporation grew rapidly. It went public on March 17, 1966, and was listed on the New York Stock Exchange on January 16, 1969. More than 3,500 franchised and company-owned restaurants were in worldwide operation when Heublein Inc. acquired KFC Corporation on July 8, 1971, for $285 million.
Kentucky Fried Chicken became a subsidiary of R.J. Reynolds Industries, Inc. (now RJR Nabisco, Inc.), when Heublein Inc. was acquired by Reynolds in 1982. KFC was acquired in October 1986 from RJR Nabisco, Inc. by PepsiCo, Inc., for approximately $840 million.
In January 1997, PepsiCo, Inc. announced the spin-off of its quick service restaurants — KFC, Taco Bell and Pizza Hut — into an independent restaurant company, Tricon Global Restaurants, Inc. In May 2002, the company announced it received shareholders’ approval to change it’s corporation name to Yum! Brands, Inc. The company, which owns A&W All-American Food Restaurants, KFC, Long John Silvers, Pizza Hut and Taco Bell restaurants, is the world’s largest restaurant company in terms of system units with nearly 32,500 in more than 100 countries and territories.
Until he was fatally stricken with leukemia in 1980 at the age of 90, the Colonel traveled 250,000 miles a year visiting the KFC restaurants around the world.
And it all began with a 65-year-old gentleman who used his $105 Social Security check to start a business.
KFC operates in 74 countries and territories throughout the world under the name “Kentucky Fried Chicken” and/or “KFC.” It was founded in Corbin, Kentucky by Colonel Harland D. Sanders, an early developer of the quick service food business and a pioneer of the restaurant franchise concept. The Colonel perfected his secret blend of 11 herbs and spices for Kentucky Fried Chicken in 1939 and signed up his first franchisee in 1952. By the time KFC was acquired by PepsiCo in 1986, it had grown to approximately 6,600 units in 55 countries and territories.
KFC restaurants offer fried chicken products and some also offer non-fried chicken-on-the-bone products, with the principal entree items sold in pieces under the names Original Recipe, Extra Tasty Crispy and Tender Roast. Other principal entree items include Chunky Chicken Pot Pies, Colonel’s Crispy Strips, and various chicken sandwiches. KFC restaurants also offer a variety of side items, such as biscuits, mashed potatoes and gravy, cole slaw and corn, as well as desserts and non-alcoholic beverages. Their decor is characterized by the image of the Colonel and distinctive packaging includes the “Bucket” of chicken.
In 1996, KFC’s worldwide system sales of over $8 billion grew faster than the industry average even though the number of restaurants in its global system did not materially increase. This growth was largely due to the impact of new products as shown by the fact that same store sales in Company-operated stores in the U.S. increased 6%. In 1995, same store sales for Company-operated stores in the U.S. were also strong, increasing 7%. For the first half of 1997, KFC same store sales growth for Company-operated units in the U.S. was consistently positive resulting in a 4% growth rate for the 24 week period. Average U.S. system-wide sales per traditional unit in 1996 were $775,000.
The Yum! Brands, Inc. organization is currently made up of six subsidiaries organized around its five core concepts, KFC, Pizza Hut, Taco Bell, A&W All-American Food Restaurants and Long John Silvers. Yum! Brands and KFC is based in Louisville, Kentucky; Pizza Hut and Yum! Restaurants International are headquartered in Dallas, Texas; Taco Bell is based in Irvine, California; and A & W All-American Food Restaurants and Long John Silvers are based in Lexington, Kentucky.
Each of Yum! Brands’ concepts are engaged in the operation, development, franchising and licensing of a system of both traditional and non-traditional QSR units. Non-traditional units include express units and kiosks which have a more limited menu and operate in non-traditional locations like airports, gas and convenience stores, stadiums, amusement parks and colleges, where a full-scale traditional outlet would not be practical or efficient. In addition, there are approximately 367 units housing more than one concept (“2n1s”). Of these, approximately 354 units offer both the full KFC menu and a limited menu of Taco Bell products, and approximately 13 units offer both the full KFC menu and a limited menu of Pizza Hut products.
In each concept, consumers can either dine in or carry out food. In addition, Taco Bell and KFC offer a drive-through option in many stores. Pizza Hut
and, on a much more limited basis, KFC offer delivery service.
Each concept has proprietary menu items and emphasizes the preparation of food with high quality ingredients as well as unique recipes and special seasonings to provide appealing, tasty and attractive food at competitive prices.
Our passion, as a restaurant company, is to put a YUM on people’s faces around the world, satisfying customers every time they eat our food and doing it better than any other restaurant company. A&W, KFC, Long John Silver’s, Pizza Hut, and Taco Bell offer customers food they crave, comeback value, and customer-focused teams. The unique eating experience at each of our restaurants make our customers smile and inspire their loyalty for life. Toward that end, our 750,000 associates around the world are trained to be customer maniacs.
With sales now in excess of $1 billion in Australia, we have proof positive of the power of Customer Mania. But what’s at its core? Three things, really:
· Operational excellence
· Great marketing and advertising
· Real “sit up and take notice” customer service
When we took the concept of Mania to our Restaurant Team Members – the talented people who deal with our customers day in, day out, every day – they embraced it with passion. They took the program and ran with it, becoming powerful catalysts for change throughout our entire organization! Why? Simple – Customer Mania unlocked their enthusiasm and creativity, empowering them to do whatever it takes to satisfy guests.
Listening to the Voice of the Customer
Customer Mania is a great concept, but how would we give it meat? By listening to the Voice of the Customer! One initiative we undertook in Australia was to invite RGMs to customer research sessions, where they could closely observe customers talking about their experiences in our restaurants. Their stories – good and bad – were telling. Customers complained about speed and communication in the KFC drive-thrus, and the lack of ready access to a manager in the restaurant.
As a direct result of these focus groups, our Customer Mania team developed two important initiatives: Improving our drive-thru facilities and service to make them more customer-friendly, and revamping our problem resolution process.
· Drive-thru: We embarked on building large glass boxes at the entry to drive-thrus, with menus and an attendant replacing the speaker. These changes will make the drive-thru experience much more personal and more responsive.
· Problem resolution process: We took our best frontline workers, put them through additional LAST training, and empowered them to resolve customer complaints on the spot. As a result, customer complaints made to the home office have been reduced dramatically – down over 50%!
It’s all about Leadership
No doubt we’ve got a long way to go. But it’s clear to me that the five leadership principles we’ve established for Customer Mania are working, and are worth sharing:
· Lead from the top
· Stay the course, create a “five-year journey” mindset
· Be consistent
· Recognize, recognize, recognize
· Define what success looks like
· Good luck, and Yum to you!