KFC, also known as Kentucky Fried Chicken, is an American fast food restaurant chain headquartered in Louisville, Kentucky, that specializes in fried chicken. It is the world's second-largest restaurant chain (as measured by sales) after McDonald's, with 22,621 locations globally in 136 countries as of December 2018[update]. The chain is a subsidiary of Yum! Brands, a restaurant company that also owns the Pizza Hut, Taco Bell, and WingStreet chains.
|Traded as||IDX: FAST|
|Genre||Fast food restaurant|
|Headquarters||1441 Gardiner Lane|
Louisville, Kentucky, U.S.
Dallas, Texas, U.S. (Global)
Number of locations
|Revenue||US$23 billion (2013)|
KFC was founded by Colonel Harland Sanders, an entrepreneur who began selling fried chicken from his roadside restaurant in Corbin, Kentucky, during the Great Depression. Sanders identified the potential of the restaurant franchising concept, and the first "Kentucky Fried Chicken" franchise opened in Utah in 1952. KFC popularized chicken in the fast food industry, diversifying the market by challenging the established dominance of the hamburger. By branding himself as "Colonel Sanders", Harland became a prominent figure of American cultural history, and his image remains widely used in KFC advertising to this day. However, the company's rapid expansion overwhelmed the aging Sanders, and he sold it to a group of investors led by John Y. Brown Jr. and Jack C. Massey in 1964.
KFC was one of the first American fast food chains to expand internationally, opening outlets in Canada, the United Kingdom, Mexico, and Jamaica by the mid-1960s. Throughout the 1970s and 1980s, it experienced mixed fortunes domestically, as it went through a series of changes in corporate ownership with little or no experience in the restaurant business. In the early 1970s, KFC was sold to the spirits distributor Heublein, which was taken over by the R.J. Reynolds food and tobacco conglomerate; that company sold the chain to PepsiCo. The chain continued to expand overseas, however, and in 1987, it became the first Western restaurant chain to open in China. It has since expanded rapidly in China, which is now the company's single largest market. PepsiCo spun off its restaurants division as Tricon Global Restaurants, which later changed its name to Yum! Brands.
KFC's original product is pressure-fried chicken pieces, seasoned with Sanders' recipe of 11 herbs and spices. The constituents of the recipe represent a notable trade secret. Larger portions of fried chicken are served in a cardboard "bucket", which has become a well-known feature of the chain since it was first introduced by franchisee Pete Harman in 1957. Since the early 1990s, KFC has expanded its menu to offer other chicken products such as chicken fillet sandwiches and wraps, as well as salads and side dishes such as French fries and coleslaw, desserts, and soft drinks; the latter often supplied by PepsiCo. KFC is known for its slogans "It's Finger Lickin' Good!", "Nobody does chicken like KFC", and "So good".
Harland Sanders was born in 1890 and raised on a farm outside Henryville, Indiana (near Louisville, Kentucky). When Sanders was five years old, his father died, forcing his mother to work at a canning plant. This left Sanders, as the eldest son, to care for his two younger siblings. After he reached seven years of age, his mother taught him how to cook. After leaving the family home at the age of 13, Sanders passed through several professions, with mixed success. In 1930, he took over a Shell filling station on US Route 25 just outside North Corbin, Kentucky, a small town on the edge of the Appalachian Mountains. It was here that he first served to travelers the recipes that he had learned as a child: fried chicken and other dishes such as steaks and country ham. After four years of serving from his own dining room table, Sanders purchased the larger filling station on the other side of the road and expanded to six tables. By 1936, this had proven successful enough for Sanders to be given the honorary title of Kentucky colonel by Governor Ruby Laffoon. In 1937 he expanded his restaurant to 142 seats, and added a motel he purchased across the street, naming it Sanders Court & Café.
Sanders was unhappy with the 35 minutes it took to prepare his chicken in an iron frying pan, but he refused to deep fry the chicken, which he believed lowered the quality of the product. If he pre-cooked the chicken in advance of orders, there was sometimes wastage at day's end. In 1939, the first commercial pressure cookers were released onto the market, mostly designed for steaming vegetables. Sanders bought one, and modified it into a pressure fryer, which he then used to fry chicken. The new method reduced production time to be comparable with deep frying, while, in the opinion of Sanders, retaining the quality of pan-fried chicken.
In July 1940, Sanders finalised what came to be known as his "Original Recipe" of 11 herbs and spices. Although he never publicly revealed the recipe, he admitted to the use of salt and pepper, and claimed that the ingredients "stand on everybody's shelf". After being recommissioned as a Kentucky colonel in 1950 by Governor Lawrence Wetherby, Sanders began to dress the part, growing a goatee and wearing a black frock coat (later switched to a white suit), a string tie, and referring to himself as "Colonel". His associates went along with the title change, "jokingly at first and then in earnest", according to biographer Josh Ozersky.
The Sanders Court & Café generally served travelers, so when the route planned in 1955 for Interstate 75 bypassed Corbin, Sanders sold his properties and traveled the US to franchise his chicken recipe to restaurant owners. Independent restaurants would pay four (later five) cents on each chicken as a franchise fee, in exchange for Sanders' "secret blend of herbs and spices" and the right to feature his recipe on their menus and use his name and likeness for promotional purposes. In 1952 he had already successfully franchised his recipe to his friend Pete Harman of South Salt Lake, Utah, the operator of one of the city's largest restaurants.
Don Anderson, a sign painter hired by Harman, coined the name "Kentucky Fried Chicken". For Harman, the addition of KFC was a way of differentiating his restaurant from competitors; a product from Kentucky was exotic, and evoked imagery of Southern hospitality. Harman trademarked the phrase "It's finger lickin' good", which eventually became the company-wide slogan. He also introduced the "bucket meal" in 1957 (14 pieces of chicken, five bread rolls and a pint of gravy in a cardboard bucket). Serving their signature meal in a paper bucket was to become an iconic feature of the company.
By 1963 there were 600 KFC restaurants, making the company the largest fast food operation in the United States. KFC popularized chicken in the fast food industry, diversifying the market by challenging the established dominance of the hamburger.
In 1964, Sanders sold the company to a group of investors led by John Y. Brown Jr. and Jack C. Massey for US$2 million (around US$15 million in 2013). The contract included a lifetime salary for Sanders and the agreement that he would be the company's quality controller and trademark. The chain had reached 3,000 outlets in 48 different countries by 1970. In July 1971, Brown sold the company to the Connecticut-based Heublein, a packaged food and drinks corporation, for US$285 million (around US$1.6 billion in 2013). Sanders died in 1980, his promotional work making him a prominent figure in American cultural history. By the time of his death, there were an estimated 6,000 KFC outlets in 48 different countries worldwide, with $2 billion of sales annually.
In 1982, Heublein was acquired by R. J. Reynolds, the tobacco giant. In July 1986, Reynolds sold KFC to PepsiCo for $850 million (around US$1.8 billion in 2013). PepsiCo made the chain a part of its restaurants division alongside Pizza Hut and Taco Bell. The Chinese market was entered in November 1987, with an outlet in Beijing.
In 1991, the KFC name was officially adopted, although it was already widely known by that initialism. Kyle Craig, president of KFC US, admitted the change was an attempt to distance the chain from the unhealthy connotations of "fried". The early 1990s saw a number of successful major products launched throughout the chain, including spicy "Hot Wings" (launched in 1990), popcorn chicken (1992), and internationally, the "Zinger", a spicy chicken fillet burger (1993). By 1994, KFC had 5,149 outlets in the US, and 9,407 overall, with over 100,000 employees. In August 1997, PepsiCo spun off its restaurants division as a public company valued at US$4.5 billion (around US$6.5 billion in 2013). The new company was named Tricon Global Restaurants, and at the time had 30,000 outlets and annual sales of US$10 billion (around US$14 billion in 2013), making it second in the world only to McDonald's. Tricon was renamed Yum! Brands in May 2002.
By 2015, the company was struggling, having lost business to other retailers and being surpassed by Chick-fil-A as the leading chicken retailer in the U.S. three years previously. To combat this, the company launched a new initiative with a plan to revamp its packaging, decor and uniforms, as well as expanding its menu. Additionally, beginning in May 2015, a new series of advertisements was launched featuring Darrell Hammond as Colonel Sanders. Subsequently, in a planned rotation of actors, Norm Macdonald, Jim Gaffigan, George Hamilton and Rob Riggle portrayed Sanders in similar ads through the fall of 2016. In January 2018, Country Music icon Reba McEntire was chosen to be KFC's first female Colonel Sanders.
KFC is a subsidiary of Yum! Brands, one of the largest restaurant companies in the world. KFC had sales of $23 billion in 2013. KFC has its headquarters at 1441 Gardiner Lane, Louisville, Kentucky, in a three-story colonial style building known colloquially as the "White House" due to its resemblance to the US president's home. The headquarters contain executive offices and the company's research and development facilities. KFC is incorporated at 1209 North Orange St, Wilmington, Delaware.
By December 2013, there were 18,875 KFC outlets in 118 countries and territories around the world. There are 4,563 outlets in China, 4,491 in the United States, and 9,821 across the rest of the world. Outlets are owned by franchisees or directly by the company. Eleven percent of outlets are company owned, with the rest operated by franchise holders. Although capital intensive, company ownership allows for faster expansion of the chain.
Most restaurants are furnished with images of the company founder, Colonel Harland Sanders. As well as dine-in and take-out, many stand-alone KFC outlets offer a drive-through option. KFC offers a limited delivery service in a small number of markets. Units include express concessions and kiosks which feature a limited menu and operated in non-traditional locations such as filling stations, convenience stores, stadia, theme parks and colleges, where a full scale outlet would not be practical. Average annual sales per unit was $1.2 million in 2013. Worldwide, the daily average number of food orders at an outlet is 250, with most occurring within a two-hour peak-period.
As a Director and CEO of Yum!, Greg Creed ultimately has foremost responsibility for KFC operations. Sam Su is chairman and CEO of Yum!'s Chinese operations, and Tony Lowings is the president and CEO of KFC, replacing Roger Eaton who retired in 2018. David Gibbs is president, CFO and COO of Yum! Brands, Inc.. On March 7, 2019 KFC announced a new excutive position "Chief Communications Officer" and Staci Rawls will fill that position.
The company hopes to expand its African operations, where it is already the regional leader among US fast food chains. The company is slowly expanding across the African continent, opening 70 outlets, but progress has been hampered by sourcing issues, such as a lack of quality suppliers.
KFC continues to grow in Asia.
In Singapore, the first KFC franchise was opened in 1977 along Somerset Road. In 1993, KFC Singapore was the first KFC in Asia to develop and launch the Zinger burger. KFC restaurants in Singapore are currently owned and operated by KFC (Malaysia) Holdings Bhd.
In Pakistan, KFC has a presence in eighteen major cities of Pakistan (Karachi, Lahore, Islamabad, Rawalpindi, Gujranwala, Sukkur, Muree etc.) with more than 65 outlets nationwide. Its first outlet was in Gulshan-e-Iqbal, Karachi. KFC Pakistan menu consists of burgers, fried chicken, nuggets, fries, rice dishes and drinks.
In Taiwan, KFC entered the market in 1984 and opened its first store in 1985 in Taipei City. The 100th store in Taiwan opened in 1999. It was the second largest fast food chain restaurant in Taiwan until Mos Burger exceeded the number of branches of KFC in 2008. Now KFC is the third largest fast food chain restaurant with 137 stores as of 2017.
KFC is the largest restaurant chain in China, with 5,003 outlets as of 2015. They are operated by the Yum! China division. KFC became the first Western fast food company in China after its first outlet opened in Qianmen, Beijing, in November 1987.
In December 2012, the chain faced allegations that some of its suppliers injected antiviral drugs and growth hormones into poultry in ways that violated food safety regulations. This resulted in the chain severing its relationship with 100 suppliers, and agreeing to "actively co-operate" with a government investigation into its use of antibiotics. KFC China sales in January 2013 were down 41 percent against the previous year. To counter sluggish sales, the menu was revamped in 2014.
In July 2014, Chinese authorities closed down the Shanghai operations of the OSI Group, amidst allegations that it had supplied KFC with expired meat. Yum! immediately terminated its contract with the supplier, and stated that the revelation had led to a "significant [and] negative" decline in sales.
There are 350 KFC outlets in India. The company has adapted the standard KFC offerings to Indian tastes and the menu options in India include the Hot & Crispy Chicken and Fiery Grilled bucket options, Chicken Zinger Burger, Krushers, Rice Bowlz and the more recently launched 5-in-1 Meal Box. The business was refranchised in October 2015 after Yum concluded a year-and-a-half-long exercise to reorganize its business under larger, well-capitalized franchisees. In this regard, about a third of its outlets, operated by several of its franchisees, have been sold to a newly formed entity—Sapphire Foods India Pvt. Ltd. The new entity is owned by a consortium of four private equity funds, led by Samara Capital. The other investors are CX Partners, Goldman Sachs Group Inc. and a fourth fund, said a top executive at the local arm of the American food company.
The first Indian KFC was a two-storey outlet on the fashionable Brigade Road in Bangalore in June 1995. According to journalist Michael White, the company could not have chosen a "more difficult venue for its maiden entrée into the country". Bangalore housed the headquarters of the Karnataka Rajya Raitha Sangha, one of the most influential, vocal and anti-foreign investment farmers' associations in the country. The first outlet suffered protests from anti-globalisation and environmental campaigners, as well as local farmers, who objected to the chain bypassing local producers. Many[quantify] Indians were concerned about the onslaught of consumerism, the loss of national self-sufficiency, and the disruption of indigenous traditions. The protests came to a head in August 1995, when the Bangalore outlet was repeatedly ransacked. The KFC outlet in Bangalore demanded, and received, a police van permanently parked outside for a year. The outlet was closed on September 13, 1995 by local authorities, who claimed the company used illegally high amounts of monosodium glutamate (MSG) in its food. The outlet re-opened a few hours later as the result of an appeal by KFC to the Karnataka High Court. The company stated the recipe was no different than that used in any other KFC store. Rural activist M. D. Nanjundaswamy claimed KFC would adversely affect the health of the impoverished, by diverting grain from poor people to make the more profitable animal feed. Environmentalist Maneka Gandhi joined the anti-KFC movement. A second outlet opened in Delhi, but was closed by the authorities throughout November, purportedly for health reasons, but more likely to avoid a repetition of the Bangalore incident. The Delhi outlet soon closed permanently.
KFC began to expand outside of Bangalore in 2004, with a localized menu that was the most extensive meat-free menu across the chain's worldwide operations. It introduced a vegetarian menu that included rice meals, wraps and side dishes and, like McDonald's, served eggless mayonnaise and sauces. Unnat Varma, marketing director of KFC India, states "The vegetarian offerings have made the brand more relevant to a larger section of consumers and that is necessary for KFC's growth." KFC also began using Indian spices and cooking techniques to localize its chicken dishes. By 2008–09, KFC operated 34 outlets in India. In 2014, KFC launched the "So Veg, So Good" menu as part of an India-specific promotional strategy focused on enhancing their vegetarian range. The company has been up to a lot of innovation over the past few months with the launch of the first-ever no crust, all chicken KFC Chizza in December 2016. More recently, KFC got Mumbai's dabbawalas to deliver its newly launched 5-in-1 Meal Boxes. The city's dabbawalas, famed for their efficient delivery of office lunches, took on the role of KFC delivery men as part of an innovative marketing campaign. They supplied specially created 5-in-1 meal boxes to some office-goers instead of their regular dabbas. The innovation efforts have continued with the launch of the Watt a Box, a practical new take on the 5-in-1 Meal Box, which can also charge phones.
In Indonesia, KFC is the largest Western restaurant chain, with 466 outlets as of December 2013. The chain has grown to hold an estimated 32 percent market share, and menu items include spaghetti, wraps and chicken porridge. The master franchisee is PT Fastfood Indonesia.
The first outlet opened in Jakarta in 1979. Salim Group, Indonesia's largest conglomerate, became a major shareholder in 1990, which provided the company with funds for major expansion. Its master franchisee, PT Fastfood Indonesia, was publicly listed on the Indonesian Stock Exchange in 1993.
KFC Japan was formed in 1970 as a joint venture between the American parent and the Japanese Mitsubishi Corporation. In December 1974, KFC Japan began to promote fried chicken as a Christmas meal. Eating KFC as a Christmas time meal has since become a widely practiced custom in Japan. As of 2013[update], Japan is the third-largest market for KFC after China and the United States with 1,200 outlets.
In December 2007, Mitsubishi assumed majority control of KFC Japan in a JP¥ 14.83 billion transaction.
Being one of its largest overseas markets, the Malaysian KFC traces its origin from January 1, 1973 from its first outlet in Jalan Tunku Abdul Rahman, Kuala Lumpur. In 2016, the brand has been crowned as the largest fast-food chain in Malaysia and dominating 45% of the local Fast-Food Market shares with its traditional rival, McDonald's following in second, while its sister restaurant, Pizza Hut spotting at the third place. By 2018, the restaurant has established a strong presence in the country, estimated to serve almost an equal proportion with the total population of Malaysia with 25 million customers every month by its 14,000 employees.
Similar to other international KFC markets, the Malaysian KFC also featuring various localised and seasonal food items in addition to the universal KFC Menu. The Malaysian KFC customarily offers two types of fried chicken: Original and Hot & Spicy, moreover, other types of fried chickens and food products are also being periodically introduced to the local consumers. Among other common year-long regional items unique to the Malaysian market includes chicken rice, rice congee, wrap, cheesy potato wedges, gula melaka vanilla pudding, white coffee and teh tarik. Malaysians mostly prefer dark meat cuts, a divergent from the American KFC that observed white meat in a higher demand. Furthermore, being a predominantly Muslim-country, all meats are slaughtered in accord to the Halal-method under the supervision of Shariah Advisory Council and the Department of Islamic Development Malaysia.
The KFC business design in Malaysian is generally offering a mid-range dining option to cater the predominantly middle-class Malaysian population. The premise is typically large in area and able to accommodate the dining culture commonly practised among the Malaysian society, a contrast to the primarily takeout model seen in the American market. Many of the Malaysian KFC also operate round the clock, offering drive-through and delivery service.
As of 2018, QSR Brands (M) Holdings Bhd, the shareholder of the company in Malaysia is also responsible on managing 810 KFC outlets across Malaysia, Singapore, Brunei and Cambodia, with more than 700 of these outlets are being located domestically in Malaysia, hence making the country one of the largest global market for the fast-food chain. The chain has been witnessed rapid expansion since the opening of its 250th Malaysian outlet on May 8, 1998 located in Petronas Twin Towers, the 500th branch in Subang launched on January 15, 2011 and the 700th restaurant in Seremban on September 18, 2018.
Additionally, the QSR Brands is also in change on handling 380 Pizza Hut outlets in Malaysia and 80 in Singapore, similar to some international developments, many of these restaurants are being traditionally combined together with a KFC premise. The company is estimated earn MYR5 billion in revenue for KFC and Pizza Hut throughout the region in 2018, up from MYR4.56 billion (2017) and MYR4.24 billion (2016), the period recorded the company earned a profit of MYR182.98 million and MYR113.44 million in 2017 and 2016 respectively.
In 1995, Projek Penyayang KFC was founded in an effort to provide food to more than 150 orphanages every quarter. The social service by the restaurant was then extended by the introduction of Tabung Penyayang Fund in 1997, Add Hope Malaysia in 2006 and Add Hope Wordwide in 2007 as means to aid the local and international community.
The chain is also one of the earliest fast-food eateries in Malaysia to employ people with different abilities from its outlet in Jalan Imbi, Kuala Lumpur in November 15, 1986 (has since relocated to Sentul Raya, Jalan Ipoh in 1992). From the first fully operated KFC in the world run by speech-and hearing-impaired staff in Kuala Lumpur, the operation has expanded to its Malaysian operation in Tanjung Aru (Kota Kinabalu) and Saujana (Kuching) outlets in 1996. Similarly, the model has also being adopted by several KFC eateries in Egypt, India, Pakistan, Singapore and Thailand. To date, the establishment has employed more than 350 Malaysian individuals predominantly of speech and hearing impairment.
As of December 2013, there were 784 KFC outlets in the United Kingdom. British turnover was around £684.5 million in 2013, according to Technomic. About 70 percent of outlets are run by franchisees, with the remainder company owned. The company employs 24,000 people. Around 400 sites are drive-through outlets. Average outlet turnover is between £1 and £1.5 million.
Annual sales amount to 60,000 metric tonnes of chicken, 60 percent of which is purchased from the four largest suppliers in the UK, including Faccenda Group and 2 Sisters Food Group, and delivered fresh to outlets at least three times a week. The remaining 40 percent is sourced from companies in Europe, Thailand (including Charoen Pokphand Foods) and Brazil. All of the Original Recipe chicken is sourced within the UK.
England had the first overseas branch of KFC which opened in Preston, Lancashire in May 1965, and was the first American fast food restaurant chain in the country, pre-dating the arrival of McDonald's, Burger King and Pizza Hut by almost a decade. Ray Allen, an experienced Lancashire caterer, was the first franchisee. The first London branch opened in North Finchley in November 1968. In 1971 there were 31 outlets; by 1975 the chain had grown to 250 outlets. In the late 1970s and throughout the 1980s, KFCs began to introduce seating. KFC opened its first drive through restaurant in the UK in 1984. By 1987 the company had almost 400 outlets.
In May 1997, the "Tower Burger", a fried chicken fillet burger with the addition of a hash brown, was first launched in the United Kingdom. In 2006, the company stopped pre-salting its fries and removed trans fats from its products. In 2012 palm oil was replaced by rapeseed oil in the fryers. Between 2004 and 2014, KFC UK increased its offering of "portable" foods: burgers, wraps and salads. During that period, sales rose from around £500 million to almost £1 billion. In 2012, KFC UK invested £9 million to install ovens in all of its outlets, so that it could offer griddled chicken. In 2013, KFC rolled out Lavazza coffee across all of its UK outlets. As of 2014, KFC UK is trialling serving only halal meat at 96 of its outlets. In February 2018 KFC had to temporarily close 575 of its 900 UK outlets, and restrict menus and opening hours in other branches, as a result of its newly-contracted distributor, DHL, failing to deliver chicken to the outlets.
KFC is planning on opening up to 50 franchise restaurants in 2019.
The first KFC in the Middle East opened in 1973 in Kuwait. Today there are over 700 outlets, certified halal, including the United Arab Emirates, Egypt, Qatar, Bahrain, Oman, Jordan, Lebanon, Morocco, Iraq, and Saudi Arabia. KFC Israel existed from 1993 to 2013 and featured kosher restaurants. In 2012 KFC opened in Ramallah in the Palestinian Authority and later expanded to Hebron, Bethlehem, Jenin, and three separate outlets in Ramallah: the Ersal Branch (Bacri), Plaza Mall Branch and Masyoun Branch. In 2013 the New York Times reported that KFC was being smuggled into Gaza through tunnels.
KFC sales in the United States in 2013 were estimated at $4.22 billion by Technomic.
The basic model for KFC in the United States, not necessarily duplicated elsewhere, is a focus on low prices, a limited menu (29 items on average) and an emphasis on takeout. A "very strong percentage" of sales come from African American customers. Many KFC locations are co-located with either Taco Bell or Pizza Hut, or other Yum! restaurants. When Yum! owned Long John Silver's and A&W Restaurants, these brands were often co-branded with KFC as well. Often these locations behave like a single restaurant, offering one menu with food items from both restaurant brands. In 2003, there were 354 KFC-Taco Bell combines, offering the full KFC menu and Taco Bell items, and 13 units offering the full KFC menu and a limited number of Pizza Hut items. The concept originated in 1991, when a KFC-Taco Bell combination opened in Virginia. Some locations were also opened as combinations of KFC, Taco Bell and Pizza Hut, but this failed to catch on, and Yum! CEO David Novak blamed a lack of franchisee commitment for its lack of success.
Initially, Sanders and KFC used hydrogenated vegetable oil for frying, but in the 1980s the company began to switch to cheaper oils such as palm or soybean. In the 2000s it became apparent that these oils contain relatively high levels of trans fat, which increases the risk of heart disease. By April 2007, the chain had switched to trans fat-free soybean oil in all of its US outlets.
In 2008, Novak credited low US sales as being the result of a lack of new ideas and menu items. The Spring 2009 launch of Kentucky Grilled Chicken only resulted in a temporary halt to the sales decline. In 2010 KFC announced a turnaround plan that included improving restaurant operations, introducing value items and providing healthier menu options. In the same year, Advertising Age noted that KFC was losing market share to its smaller chicken restaurant rival, Chick-fil-A. In 2011 Bloomberg News referred to KFC US as "an also-ran to McDonald's Corp". In 2012, Forbes magazine described how many of the KFC outlets were "aged and uninviting", and that the chain "hasn't introduced an exciting new food item in ages".
KFC was described in 2012 by Bloomberg Businessweek as a "muscular player" in developing regions, specifically Africa, China and India, while noting its falling market share in the US to rivals such as Chick-fil-A and Popeyes. Some analysts speculated that KFC would begin spinning off its ailing US operations. That year, the company began divesting control of company-owned US restaurants to franchised operations, with the intention of reducing overall company ownership from 35 percent to 5 percent.
There are over 600 KFC outlets in Australia, and around 100 in New Zealand. KFC was the first American style fast food chain to open in both countries. In 2013, KFC reported an annual turnover of almost 2 billion AUD for its Australia and New Zealand operations.
Yum! directly operates 160 KFC outlets in Australia. The largest of the 53 independent franchisees in Australia is Collins Foods, which operates 169 stores. KFC's major poultry suppliers in Australia are Inghams, Steggles and Turi Foods.
The first Australian KFC was opened in 1968 in Guildford, a suburb of Sydney. The franchise was owned by a Canadian entrepreneur called Bob Lapointe. Between 1970 and 1971, 75 outlets were opened. This had a major impact on Australian chicken production, which increased by 38 percent during the period. By 1995 there were 452 outlets, and the company employed 12,000 staff. That year, Australia produced 35 percent of KFC's international earnings.
The first KFC opened in New Zealand in 1971 at Royal Oak, a suburb of Auckland. By 1980 there were 37 outlets. In 1989, PepsiCo acquired the 50 percent stake in KFC New Zealand that it did not already own from the local Goodman Fielder conglomerate. In 1991 New Zealand turnover topped 100 million NZD for the first time.
KFC's core product offering is pressure fried, on-the-bone chicken pieces seasoned with Colonel Harland Sanders' "Original Recipe" of 11 herbs and spices. The product is typically available in either two or three piece individual servings, or in a family size cardboard bucket, typically holding between 6 and 16 chicken pieces. In territories that follow the system handed down by Colonel Sanders, such as Canada and the UK, each chicken is divided into nine different cuts (2 drumsticks, 2 thighs, 2 wings, 2 breast pieces and one keel), however the United States now uses an eight piece cut. The product is hand-breaded at individual KFC outlets with wheat flour mixed with seasoning in a two- to four-minute process. It is then pressure fried for between seven and ten minutes (the timing differs between countries) in oil at 185 degrees Celsius. Following this, the chicken is left to stand for 5 minutes in order for it to sufficiently cool before it is placed in the warming oven. It is KFC policy to discard chicken if it has not been sold within 90 minutes, in order to ensure freshness. The frying oil varies regionally, and versions used include sunflower, soybean, rapeseed and palm oil. A KFC executive stated that the taste of the chicken will vary between regions depending on the oil variety used, and whether the chicken has been corn-fed or wheat-fed.
As well as its core chicken on the bone offering, KFC's major products include chicken burgers (including the Zinger and the Tower burgers); wraps ("Twisters" and "Boxmasters"); and a variety of finger foods, including crispy chicken strips and hot wings. Popcorn Chicken is one of the most widely available KFC products, and consists of small pieces of fried chicken. In some locations, chicken nuggets are also sold.
KFC adapts its menu internationally to suit regional tastes, and there are over three hundred KFC menu items worldwide. Some locations, such as the UK and the US, sell grilled chicken. In predominantly Islamic countries, the chicken served is halal. In Asia there is a preference for spicy foods, such as the Zinger chicken burger. Some locations in the US sell fried chicken livers and gizzards. A small number of US outlets offer an all-you-can-eat buffet option with a limited menu.
A number of territories, such as Japan, Jamaica, Trinidad, Barbados, Ecuador and Singapore sell fried seafood products under the "Colonel's Catch" banner. In Jamaica, what was originally a seasonal offering for the Lent period was expanded to a year-round offering from 2010.
Value menu items are sold under the "Streetwise" name in locations such as Canada. Side dishes often include French fries, coleslaw, barbecue baked beans, corn on the cob, mashed potato, bread rolls and American biscuits. Salads include the bean salad, the Caesar salad and the garden salad. In a number of territories, KFC sell onion rings. In Asia, rice based side dishes such as congee are often sold. In the US and Greece, potato wedges are sold instead of French fries.
Due to the company's previous relationship with PepsiCo, most territories supply PepsiCo products, but exceptional territories include Barbados, Greece, New Zealand, the Philippines, Romania, South Africa, and Turkey, which stock drinks supplied by The Coca-Cola Company, and Aruba, which stocks RC Cola from the Cott Corporation. In Peru, the locally popular Inca Kola is sold. In a number of Eastern European locations and Portugal, beer is offered, in addition to soft drinks.
Launched in 2009, the Krusher/Krushem range of frozen beverages containing "real bits" such as Kit Kat, Oreo and strawberry shortcake, is available in over 2,000 outlets. Egg custard tart is a popular dessert worldwide, but other items include ice cream sundaes and tres leches cake in Peru.
11 herbs and spices
Sanders' Original Recipe of "11 herbs and spices" is one of the most famous trade secrets in the catering industry. The recipe is not patented, because patent law requires public disclosure of an invention and provides protection only for a strictly limited term, whereas trade secrets can remain the intellectual property of their holders in perpetuity.
A copy of the recipe, signed by Sanders, is held inside a safe inside a vault in KFC's Louisville headquarters, along with eleven vials containing the herbs and spices. To maintain the secrecy of the recipe, half of it is produced by Griffith Laboratories before it is given to McCormick, who add the second half.
In 1999, a couple who bought the house formerly occupied by Colonel Sanders found scribbled notes purported to be the secret recipe. Initially KFC wanted to file a lawsuit against the couple to stop an auction of the notes, but by early 2001, it dropped the lawsuit, claiming the scribbled notes are "nowhere close" to the original recipe.
Joe Ledington of Kentucky, a nephew by marriage of Colonel Sanders, claimed to have found a copy of the original KFC fried chicken recipe on a handwritten piece of paper in an envelope in a scrapbook. In August 2016, Chicago Tribune staffers conducted a cooking test of this recipe and claimed after a few attempts that, with the addition of MSG flavor-enhancer, Ac'cent, they produced fried chicken which tasted "indistinguishable" from the chicken they purchased at KFC.
KFC initially used stove-top covered cooking pots to fry its chicken. In the 1960s, the officially recommended model was the L S Hartzog developed "KFC 20-Head Cooker", a large device that cost $16,000. The Hartzog model had no oil filtration system, meaning that filtering had to be done manually, and the pressure fryers occasionally exploded, often causing harm to employees. In 1969, inventor and engineer Winston L. Shelton developed the "Collectramatic" pressurized fryer to overcome the problems KFC faced in quickly frying chicken to meet growing customer demand. The Collectramatic used precision time and temperature controls and self-filtered the cooking oil – all while meeting Colonel Sanders' legendary high quality standards. Fred Jeffries, then vice president of purchasing at KFC, claimed that the invention helped fuel the company's rapid expansion and success:
There's no way it (KFC) could have grown like it did without the Collectramatic. Stores were doing about $200,000 a year in sales on average with the pots ... but they could never have done the $900,000 a year it became without Win's fryer. He (Shelton) helped set the stage for that with true engineering thinking.
Although a number of franchisees bought the Collectramatic, which had the support of Colonel Sanders from 1970 onwards, John Y. Brown had given tacit approval to franchisees to exclusively use the older L S Hartzog fryer, saying "Though those old pots were damn dangerous, at least we knew they worked! I was mostly afraid these new fryers would break down in the middle of business." Brown warned franchisees that they were in violation of their contract if they used the Collectramatic. Brown held his ground on the issue until he learned that his father, John Y. Brown Sr., who owned multiple KFC franchises, was successfully using the Collectramatic in every franchise he owned. The issue was eventually resolved after Heublein purchased KFC, acquired Hartzog and nullified the contract. The Collectramatic has been an approved pressure fryer for KFC from 1972 onwards.
Colonel Sanders was a key component of KFC advertising until his death in 1980. Despite his death, Sanders remains a key icon of the company as an "international symbol of hospitality". Early official slogans for the company included "North America's Hospitality Dish" (from 1956) and "We fix Sunday dinner seven nights a week". The "finger lickin' good" slogan was used from 1956, and went on to become one of the best-known slogans of the 20th century. The trademark expired in the US in 2006. The first KFC logo was introduced in 1952 and featured a "Kentucky Fried Chicken" typeface and a logo of the Colonel.
Advertising played a key role at KFC after it was sold by Sanders, and the company began to advertise on US television with a budget of US$4 million in 1966. In order to fund nationwide advertising campaigns, the Kentucky Fried Chicken Advertising Co-Op was established, giving franchisees ten votes and the company three when deciding on budgets and campaigns. In 1969, KFC hired its first national advertising agency, Leo Burnett. A notable Burnett campaign in 1972 was the "Get a bucket of chicken, have a barrel of fun" jingle, performed by Barry Manilow. By 1976 KFC was one of the largest advertisers in the US.
Controversies and criticism
Since the beginning of the 21st century, fast food has been criticized for its animal welfare record, its links to obesity and its environmental impact. Eric Schlosser's book Fast Food Nation (2002) and Morgan Spurlock's film Super Size Me (2004) reflected these concerns. Since 2003, People for the Ethical Treatment of Animals (PETA) has protested KFC's choice of poultry suppliers worldwide. The exception is KFC Canada, which signed an agreement pledging to only use "animal friendly" suppliers. PETA has held thousands of demonstrations, sometimes in the home towns of KFC executives, and CEO David Novak was notably soaked in fake blood by a protester. President of KFC's US division Gregg Dedrick said PETA mischaracterized KFC as a poultry producer rather than a purchaser of chickens. In 2008, Yum! stated: "[As] a major purchaser of food products, [Yum!] has the opportunity and responsibility to influence the way animals supplied to us are treated. We take that responsibility very seriously, and we are monitoring our suppliers on an ongoing basis."
In 2006, Greenpeace accused KFC Europe of sourcing the soya bean for its chicken feed from Cargill, which had been accused of clearing large swathes of the Amazon rainforest in order to grow the crop.
In 2010, the Australian arm of KFC was accused of racial insensitivity over a television commercial showing an outnumbered white cricket fan handing out pieces of fried chicken to appease a dancing, drumming and singing group of black West Indies supporters. The clip found its way around the world on the internet, prompting strong criticism in the United States where fried chicken remains closely associated with long-standing racist stereotypes about black people in the once segregated south.
In May 2012, Greenpeace accused KFC of sourcing paper pulp for its food packaging from Indonesian rainforest wood. Independent forensic tests showed that some packaging contained more than 50 percent mixed tropical hardwood fiber, sourced from Asia Pulp & Paper (APP). APP said such fiber can be found in recycled paper, or: "It can also come from tree residues that are cleared, after a forest area has become degraded, logged-over or burned, as part of a sustainable development plan. APP has strict policies and practices in place to ensure that only residues from legal plantation development on degraded or logged-over forest areas and sustainable wood fiber enters the production supply chain." KFC said: "From a global perspective, 60 percent of the paper products that Yum! (our parent company) sources are from sustainable sources. Our suppliers are working towards making it 100 percent."
In December 2012, the chain was criticized in China when it was discovered that a number of KFC suppliers had been using growth hormones and an excessive amount of antibiotics on its poultry in ways that violated Chinese law. In February 2013, Yum! CEO David Novak admitted that the scandal had been "longer lasting and more impactful than we ever imagined." The issue is of major concern to Yum!, which earns almost half of its profits from China, largely through the KFC brand. In March 2013, Yum! reported that sales had rebounded in February, but that lower sales in December and January would result in a decline in same-store sales of 20 percent in the first quarter.
In 2017, KFC was fined £950,000 after two workers were scalded by boiling hot gravy. The company admitted to charges of failing in a duty of care to employees, and was ordered by Teesside Crown Court to pay fines of £800,000 and £150,000.
In 2017, KFC paid 500,000 HUF (~1900 USD) to a charity chosen by a journalist, who was beaten by the security guard of a KFC in Budapest, Hungary.
In February 2018, logistics mismanagement by DHL, which had been selected by KFC UK as their new delivery partner, caused a chicken shortage in the United Kingdom – KFC's largest market in Europe – forcing the company to temporarily close hundreds of restaurants around the country. KFC apologized by taking out adverts in British newspapers with the company's initials scrambled to read "FCK" on it followed by an apology, which was well received.
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