Interpretation of McDonald's and The Secrets behind the KFC brands
Author: Wang Xingang
This article comes from the 229 pages of the textbook of "Brand Management", Machinery Industry Press published in March 2022
More than a year ago, I read a book called "Never Say the Failed: I Challenged McDonald's", author: Qiao Ying, the founder of the original Red Sorghum brand. This made me develop a strong interest in foreign fast food brands such as McDonald's and KFC, and left a doubt in my heart: Why can't Chinese food go global and become an international brand for so many years? Although today's Haidilao Hot Pot has begun its internationalization journey, it is a standardized product, not a Chinese food in my heart (traditional stir-frying, not a standardized product such as fast food and hot pot). A few years ago, a friend told me that in the early 1980s, when he went to study in the United States, his first stop was San Francisco . While eating, he saw a McDonald's, which was next to a Chinese restaurant. Thirty years have passed, McDonald's has spread all over the world, and that Chinese restaurant is no longer there. After hearing this, my years of doubts have increased. In recent years, I have been fortunate to have a relationship with the catering industry and gradually realized the complexity of Chinese restaurant operations and the diversity of , which is more difficult than I imagined. Then why can McDonald's and KFC succeed? The answer is shown in the picture.
Figure 13-2 The secret behind Western fast food brands
First of all, the standardization of products and services. This is enough to let the store run and everything is in control. Behind standardization is planning. It is precisely because of standardization that foreign fast food has become planning from the procurement of raw materials, inventory, product production and production, to the selection and design of store area, as well as sales forecasts, etc. Standardized products can be produced using machines, which greatly reduces the factors of artificial instability and labor management costs. In this way, it seems much simpler and clearer than the management of Chinese food. Moreover, they have few products, mainly hamburgers and coke, and then chicken rolls, chicken wings, chicken legs, etc., but their product combinations are many, which can match you with different combinations. In contrast, Chinese food, due to product differentiation, cannot be completed by machine operation and is manually made, greatly increasing the instability of product and service quality, and also increasing the management cost of personnel. There are many Chinese food products, and each single product may require a lot of ingredients, which causes complexity and diversity in every link such as logistics procurement, production and production, which seriously hinders the growth and expansion of the brand. When dining outside, I like to read other people's recipes and study the product structure of the store. I found that many Chinese restaurants, including chicken, duck, fish, sheep, cattle, etc., are all-inclusive, and some even have "east" and "west". Laozi The Tao Te Ching once said: More is confusing, and less is clear.
followed by customer participation. At KFC and McDonald's, customers make ordering, delivering dishes, checking out, and printing invoices themselves, while in Chinese restaurants, almost all these are done by waiters. One is to increase the customer experience through customer participation, greatly reducing labor costs and management costs; the other is to increase the customer experience by serving customers, greatly increasing labor costs and management costs. The participation of customers made us see that there were very few foreign fast food waiters. Apart from cleaning, there were no waiters and food deliverymen in Chinese restaurants. Moreover, there are not many "chefs" in the backstage, and the machine operation makes the boss no longer have any fears about the chef. In foreign fast food stores, customers can order food through self-service terminals and mobile APPs, which will reduce many unnecessary management costs. For example: In Chinese restaurants, you often have problems such as ordering wrong or serving the wrong dishes when ordering, and ordering yourself is determined by the customer if you order wrongly, because you check out in advance. After that, you can pick up the meal through documents, dine in or take it away. If taken away, foreign brand fast food will save more business area costs, or time costs caused by customers' waiting. Finally, if the customer needs an invoice, he can scan the QR code and go back and print the invoice by himself. In this way, KFC and McDonald's will save a lot of costs related to printing invoices related to equipment, consumables, time and management.If you forget to print the invoice when you go back, they will have to pay less taxes.
and then the gross income of a single seat. I once asked students in multiple classes, comparing the gross profit margins of unit seats in Chinese restaurants and foreign brands of fast food, and the results were amazed by everyone. Chinese restaurants have two meals a day, each meal costs 3 hours, and are usually open for 6 hours, calculated at 80 yuan per person (mass consumption). Each meal goes through the table twice, and each seat earns 320 yuan a day. As for KFC and McDonald's, they are open 24 hours a day (train station), and some are open until 10 o'clock in the evening. Calculate based on the per capita consumption of 35 yuan, turn the table seats every half hour, and calculate based on the real business hours of 8 hours a day, and each seat earns 560 yuan a day. This is not counting their takeaway, nor is it counting that the cost of KFC and McDonald's is much lower than that of Chinese food. It can be seen that the utilization rate of equipment and personnel in Chinese restaurants is too low. But can all this change? It is not so easy to change because the stereotype in the minds of consumers is that is to eat Chinese food at noon and at night, and will not go at other times. KFC and McDonald's are different. They are fast food and can be eaten at any time. This is also one of the important reasons why some Chinese foods have begun to operate in the direction of casual restaurants. Because casual restaurants can extend business hours and increase equipment utilization, but also increase staff costs.
Finally, there is economies of scale and brand effect . McDonald's and KFC continue to expand their stores, continuously strengthen themselves, increase their voice in the entire supply, production and sales chain, and greatly reduce human factors through informatization and technological means, thereby reducing many management problems and making store management easier and easier to operate, which is conducive to increasing the stability of the operation and management control of many stores. In this way, it will not be like Chinese food, where people rely too much, making it difficult to expand and open a store. In addition, after more stores, it can advertise around the world and nationwide to increase the brand effect. Chinese food is difficult to advertise without many stores, and can only rely on oral communication. Now with mobile phones, it will be better than before, but it still cannot be compared with KFC and McDonald's nationwide advertising. Once a company has economies of scale and brand effects, it is often difficult for competitors to catch up.
You can imagine that for many years, KFC and McDonald's have entered China, and prices in China have been rising continuously. Many Chinese restaurant stores have made lower and lower profits, and they are already struggling; but McDonald's and KFC still have a large profit margin. It is worthy of deep thought by the Chinese people. It can be seen from this that if Chinese restaurants want to move towards internationalization and to the world, there is still a long way to go.
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