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Bcg of Kfc

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BCG Matrix of KFC The need for strategy, in order to expand its existing product in very promising markets for KFC is very essential. KFC, along with McDonalds, and other major fast food chains have dominated the American continent as well as else where. Since the1950’s when the founder of KFC had a dream, of building an empire in the fast foodmarket, the company has undergone lots of changes. The company has changedownership; it has taken over from Pepsi and passed over to Tricon, which owns Pizza hut,Taco bell and others. Nowadays, KFC, still dominates the chicken fast food industry while has stores inmore than 100 countries operating vast profits. (De Witt 'et al.2004a) Although, due toincreased …show more content…

The business strength measure is the business;sRelative Market share. The environmental measure is the Market Growth Rate.BCG Matrix: The market growth rate measures industry attractiveness. Becausefor the case of YUM Brand, all SBUs ( KFC, Taco Bell, Pizza Hut, Long John Silver’s, A&W) are located in the same fast- food industry, the referent standard is the industrygrowth rate measured against the SBUs’ growth rate. The underlying theory for examining market growth rate is the industry life cycle. The BCG assumes that growthrates ( life cycle stages) affect a firm’s finances. results in 4 categories in a portfolio of a company:1.Stars (=high growth, high market share) • Use large amounts of cash and are leaders in the business so they shouldalso generate large amounts of cash. • Frequently roughly in balance on net cash flow. However if needed anyattempt should be made to hold share, because the rewards will be a cashcow if market share is kept. So, KFC Malaysia is under Star position.2.Cash Cows (=low growth, high market share) • Profits and cash generation should be high, and because of the low growth,investments needed should be low. Keep profits high.3.Dogs (=low growth, low market share) • Avoid and minimize the number of dogs in a company. • Beware of expensive ‘turn around plans’.4.Question Marks (= high growth, low market share • Have the worst cash characteristics of all, because high demands and lowreturns due to

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