Kentucky Fried Chicken

Franchising In India

Project By:
Vismeet Mehta Trupti Patel Vishal Sanduja Vihal Trivedi Saurabh Jhunjhunwala Siddharth D. Naik Vishit Jain 10dm-180 10dm-167 10dm-177 10dm-183 10fn-104 10dm-153 10dm-178

Acknowledgement
We are grateful to a large sum of people without whom we would not have been able to complete this project. Their i n s i g h t s , a d v i c e a n d suggestions have made the data valuable and user friendly. We are extremely grateful to Mr. Abhijeet Tyagi, Manager of KFC at the Noida outlet. We are also thankful to all the staff members and the valuable customers who shared time and insights. We would also like to thank Dr. Deboratta Datta, Faculty for International Business, for giving us this project and for his cordial cooperation and valuable time.

Table of Contents
What is Franchise? ........................................................................................................................................ 4 Advantages & Challenges of Franchising ...................................................................................................... 5 Top 3 Reasons to Franchise .......................................................................................................................... 8 Franchising in India - An Emerging Trend ..................................................................................................... 9 Franchisee Model Selection Criteria ........................................................................................................... 10 Major players of fast food in India .............................................................................................................. 11 About KFC.................................................................................................................................................... 12 Entry of KFC in India .................................................................................................................................... 13 KFC India ..................................................................................................................................................... 14 Problems Faced by KFC in India .................................................................................................................. 15 Marketing Strategies of KFC........................................................................................................................ 17 BCG Matrix .................................................................................................................................................. 18 Marketing mix ............................................................................................................................................. 20 SWOT .......................................................................................................................................................... 23 Competitive analysis ................................................................................................................................... 26 Competitive Advantage .............................................................................................................................. 27 Strengths and weakness of competitor ...................................................................................................... 28 PESTEL Analysis ........................................................................................................................................... 29 Questionnaire ............................................................................................................................................. 32 References .................................................................................................................................................. 33

What is Franchise?
Franchising is one of the popular business expansion systems in the world today. It has been around since ancient history and has now out beat all business models in the world market. Franchising is the practice of using another person's business model. The franchisor grants an independent operator the right to distribute its products, techniques, and trademarks for a percentage of gross monthly sales and a royalty fee. Various tangibles and intangibles such as national or international advertising, training, and other support services are commonly made available by the franchisor. The success of franchising as a business system can be attributed to several factors. The most obvious is the brand name. In todays consumer market, brand names are worth a lot. Every year, billions of dollars are spent on advertising and marketing the brand name of companies. This is because a good brand name means consistency, quality and consumer trust. Also, more importantly it is the proven business system a franchise can offer you. Statistics show that 90% of all start up businesses fail within the first five years of operations. This is because new business owners have to fight against time, they have to learn so much and do so much to get the business off the ground before they run out of capital. Add this to the market power of the competition and you will see why only a few make it past the five year mark. On the contrary, franchise business gives you the advantage of not having to reinvent the wheel when it comes to handling the various aspects of business right from marketing to human resource management, from accounting to distribution. A proven system enables you to avoid the traps or mistakes a new business makes.

Advantages & Challenges of Franchising

Advantages Advantage #1--The Experience of the Franchisor When an individual buys a franchise, he purchases the years of experience and the proven methods of the franchise system, also known as the franchisor. One franchisee expressed it this way: "What I have learned from the franchisor was worth ten times what I paid for the franchise." In any new business, much time and money are spent in trial and error. A proven franchise may eliminate many of the start-up problems. This reason permits one to open a franchise business with little or no previous experience in a given industry. Advantage #2--Training A franchise system will provide training for the new franchisee. This is usually done at the home office and at the franchisee's place of business. This training should prepare the new owner in all facets of the business. Advantage #3--Buying and Advertising Most small-business people cannot afford to inventory products in bulk or do extensive advertising. The franchisee buys this advantage when he or she purchases the right to use the franchise system's purchasing power and advertising. Most systems provide advertising help and direction. Furthermore, as the number of franchisees increases, so does public awareness of the franchise. This can be a tremendous advertising advantage. Also, franchisees that are located near one another can advertise together, thus reducing costs. Advantage #4--Ongoing Advice, Research and Development Franchisees need assistance throughout the term of their business endeavors. The franchise system's staff of experts can give this needed help in all aspects of the business. The franchisor is also in a position to provide on-going research and development. Thus, new products and services will be brought to the attention of the franchisee.

Advantage #5--Business Synergy The word "synergy" refers to the idea that the sum of the whole is greater than the separate parts. This principle can be applied to franchising. Those who buy a franchise become part of a "family" where all members work together for the good of the whole. Indeed, there can be support and assistance in a franchise organization that assists everyone in becoming successful. Often, some of the most effective ideas come from franchisees who in turn share their ideas with the corporate office and with other franchisees.

Challenges Challenge #1--Working Within the System People who have difficulty following directions or who dislike working within a system may find franchising extremely frustrating. Conformity to the franchise system is critical if consistency among franchises is to be maintained. However, there are areas such as marketing where a franchisee can be creative. Challenge #2--The Risk While it is true that purchasing a franchise has less risk than starting an independent business, there still are risks. Because you own the business, you, to a great extent, determine the success of your venture. The franchisor may have a great program and a respected name, but in the final analysis much of the risk is in your hands. Challenge #3--Working With the Franchise System Buying a franchise can be closely compared to entering into a marriage. Both are legally binding relationships that can last for a long time. Your relationship with the franchise system and its staff will be extremely important. Get to know the franchise system through the following methods: a. Visit the corporate headquarters. Seek to get a feel for the staff and how smoothly the operation runs. b. Talk to other franchisees. Ask what their relationship with the franchisor is like. c. Read as much about the franchise as possible. Challenge #4--False Expectations

Some people enter franchising expecting instant success. Perhaps the reason some expect this is the tremendous success achieved by some franchisees. However, this success did not come without hard work and great effort. Franchising, like any other business, requires tremendous time, initiative and industry. Obtain from the franchisor as realistic a picture as possible as to what is required in operating that particular franchise. Challenge #5--Managing the Business Some individuals are more prepared to manage a business than others. They have some business experience and have learned to get along well with people. Other individuals may find that managing a franchise is a tremendous burden. You must honestly assess your preparation to run a business. If you find that you have little or no experience, you may want to seek special assistance from the franchisor in business management.

Top 3 Reasons to Franchise

Franchising avoids the problems of slow growth, the problems of outside capital, and the problems of finding the right employees. In short, franchising solves the problems of Money, Time, and People. And it does so in creative ways:

Money Franchising transfers almost the entire cost of expansion to franchisees. Franchisees build the building or pay the rent, buy the inventory, pay the employees and provide the working capital until sales make the business profitable. And the growth of a franchise is limited only by the number of people willing to buy the franchise and the number of locations that can be sold. What is the cost to the franchisor? Often it is no more than it would cost to establish a single new company-owned unit.

Time Anxious to move quickly before the competition catches on? Got a hot, new concept? Want to exploit a new marketing opportunity? Franchising is the one growth system that allows businesses to expand exponentially. A franchise can grow fast simply by selling individual units. Some franchises can grow even faster by selling multiple units or territories to sub franchises. Either way, it is usually faster to open franchises than company-owned units.

People "A good manager is hard to find." Not exactly an original idea. Studies show that franchisees make excellent managers. Why? Because they have a vested interest in the business. They own it. Through franchising, a company gets both dedicated managers and relief from the problems associated with hiring and firing personnel.

Franchising in India - An Emerging Trend

Grown from a questionable format to an admissible mode of business expansion in India Pioneering companies proved that franchising can work in any market/ country Brought a graphic change in over-all working culture in the business Technology and internet are helping at both ends: To create the awareness about new products & services, and Enabled high consumer servicing allowing fast proliferation of worthy concepts & products Revolutionary year - 2010, Booming entrepreneurship: 1800 Home Grown Franchisors & 2,00,000 Franchisees 85% success rate in franchising Vs. 90% failure in self start ups Franchise industry estimation has towered up to over US$ 7 billion Highest retail outlet density in the world to up to approx. 12 million Remains the best entry & expansion strategy SMEs are the key economy drivers Employs over 97,00,000 employees directly or indirectly

Franchisee Model Selection Criteria

1. Specific Knowledge Requirement 2. Time to teach 3. Distinctiveness from competitors 4. Degree of geographic dispersion and involvement in foreign countries 5. Investment requirement from franchiser 6. Systemization of Business

Major players of fast food in India

McDonalds 160+ outlets KFC 72 outlets Pizza hut 147 outlets Dominos Pizza 274 outlets Caf Coffee Day 833 outlets Barista 200 outlets

About KFC

KFC Corporation, based in Louisville, Kentucky, is the worlds most popular chicken restaurant chain, specializing in Original Recipe , Extra Crispy TM, and Colonels Crispy Strips chicken with home style sides and five new freshly made sandwiches. Every day, nearly eight million customers are served around the world. KFCs menu everywhere includes Original Recipe chickenmade with the same great taste Colonel Harland Sanders created more than a half-century ago. Customers around the globe also enjoy more than 300 other productsfrom a Chunky Chicken Pot Pie in the United States to a salmon sandwich in Japan. KFC continues reaching out to customers with home delivery in more than 300 restaurants in the United States and several other countries. And in quite a few U.S. cities, KFC is teaming up with other restaurants, Taco Bell and Pizza Hut, selling nearly fifty years ago; Colonel Sanders invented what is now called home meal replacement selling complete meals to harried, time-strapped families. He called it, Sunday Dinner, Seven Days a Week. Today, the Colonels spirit and heritage are reflected in KFCs brand identity the logo features Colonel Harland Sanders, one of the best-recognized icons in the world.

KFC specializes in chicken and they say,

No bodys cooking like KFC today and we are the chicken experts There is no competitor for spicy chicken which is made by KFC

Entry of KFC in India

For the current Indian market for fast food, it is not difficult for a fast food restaurant to enter the market. However, it would be extremely difficult to take over already running major fast food chains' dominancy in India or even make a significant amount of profit.

While there are enough people in urban India for any restaurant to survive, KFC holds the first-mover advantage into the 'non-veg food specialty food segment' that gives them free reputation. Customers, especially children who are used to going to KFC as a treat or reward from their parents or grandparents, are not going to want to go to other restaurants theyve never heard of. The brand name is already established.

Also, there is already a large variety in the numerous western-style dining places in India, such as McDonalds, Pizza Hut, Domino's and Subway, and any new fastfood entrants would just be presenting something very similar to whats already there. While small neighborhood restaurants generally have low barriers to entry, these are the barriers to entry for similar restaurant businesses to enter the fast-food chain market.

KFC India
Foreign fast food companies were allowed to enter India during the early 1990s, thanks to the economic liberalization policy of the Government of India (GoI). One of the first fast food multinationals to set foot in India was Kentucky Fried Chicken (KFC), owned by PepsiCo. KFC received permission to open 30 new outlets across the country. It chose Bangalore as its launch pad because the city had a substantial upper middle class population, with a trend of families eating out. Also, it was considered Indias fast growing metropolis in the 1990. The Bangalore outlet was opened in June 1995. Apart from Bangalore, PepsiCo planned to open 60 KFC and Pizza Hut outlets in the country over the next seven years. KFC is the worlds No.1 Chicken QSR and has industry leading stature across many countries like UK, Australia, South Africa, China,USA, Malaysia and many more. KFC is the largest brand of Yum Restaurants, a company that owns other leading brands like Pizza Hut, Taco Bell, A&W and Long John Silver. Renowned worldwide for its finger licking good food, KFC offers its signature products in India too! KFC has introduced many offerings for its growing customer base in India while staying rooted in the taste legacy of Colonel Harland Sanders secret recipe. Its signature dishes include the crispy outside, juicy inside Hot and Crispy Chicken, flavorful and juicy Original Recipe chicken, the spicy, juicy & crunchy Zinger Burger, Toasted Twister, Chicken Bucket and a host of beverages and desserts. For the vegetarians in India, KFC also has great tasting vegetarian offerings that include the Veggie Burger, Veggie Snacker and Veg Rice meals. In India, KFC is growing rapidly and today has presence in 13 cities with close to 72 restaurants.

Mission statement
To be the leader in western style quick service restaurants through friendly service, good quality food and clean atmosphere

Problems Faced by KFC in India

KFC entered India in 1995 and has been in midst of controversies since then. The regulatory authorities found that KFC's chickens did not adhere to the Prevention of Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium glutamate (popularly known as MSG, a flavor enhancing ingredient) as allowed by the Act. Since the late 1990s, KFC faced severe protests by People for Ethical Treatment of Animals (PETA), an animal rights protection organization. PETA accused KFC of cruelty towards chickens and released a video tape showing the ill-treatment of birds in KFC's poultry farms. However, undeterred by the protests by PETA and other animal rights organizations, KFC planned a massive expansion program in India. RE-ENTRY OF KFC INTO INDIAN MARKET KFC entered India in 1995, but a controversy surrounding the levels of MSG in its preparations and subsequent protests from farmers' groups and animal rights activists spelt trouble for the company. Ultimately, the company had to shut all but one outlet in the country. Only recently in 2003 it made a quiet reentry into the Indian market. It then came up with the strategies and menu that is desirable by the Indian consumers. And since 2003 it is expanding successfully its business in India.

INTERVIEW OF TRANEE AT KFC, SEC.18, NOIDA: TRANEES NAME:- MR. DEBASHISH HE SAID THAT WHEN KFC ENTERED IN INDIA IN 1995 IT WAS NOT SUCCESSSFUL BECAUSE THEY HAVE NOT ADDED THE FLAVOURES AND SPICES IN THE KFC MENU WHICH INDIAN PEOPLE LIKE. THE MAIN REASON OF KFC FAILURE WAS THAT KFC WAS TARGETTING HIGHER CLASS INCOME GROUP IN INDIA TO HAVE THE COMEPETITIVE ADVANTAGE WITH THE LOCAL CHICKEN DHABA WALAS. BUT DUE TO PROTEST OF INDIAN FARMERS AND GOVERNMENT PRESSURE IT HAD TO LEAVE INDIA. BUT AGAIN IN 2003 IT CAME BACK INTO INDIA WITH THE STRATEGIES LIKE TARGETTING HIGHER INCOME GROUP LEVEL. BUT AT THE SAME TIME PROVIDING MENU WHICH CAN BE AFFORDED BY THE MIDDLE INCOME GROUP LEVEL LIKE KFC MINI BURGER AT RS.25 AND CAME UP WITH MENU LIKE HOT CRISPY CHICKEN WHICH CONTAINS INDIAN SPICES WHICH INDIAN PEOPLE LIKE. BUT NOW THEY ARE ADHERING THE RULES OF FOOD CORPORATION OF INDIA AND PETA AND EXPANDING BUSINESS SUCCESSFULLY

Marketing Strategies of KFC

KFC is following Niche Marketing and Societal Marketing techniques. KFC possess a western culture because some of the Indian people are also following that culture. KFC are moving from Divisional Level to the District level by opening branches KFC also offer free home delivery. KFC open their outlets on reachable places. KFC menu consists of more than 30 products. KFC gives more priority to Family

BCG Matrix
KFC India - BCG Matrix

Crispy Boneless Chicken

Krushers

?
Veg Thali

Chicken Bucket

Question Mark:
Currently KFC have launched a new product in the market. They have also tried to come into the beverages market by launching its new brand of shakes called KRUSHERS. As it is a fairly new product it comes in the category of the Question Mark in the BCG Matrix. It has a low market share thus brings low revenue. KFC is advertising a lot to popularize this product so there is a lot of expenditure on it. This product is individually not bringing any profits and is a cash drain for the company. Company may decide to completely remove this product from the market if it does not do well soon and start bringing in revenue.

Dog:
KFCs Veg Thali comes under this category. Although company had launched this product much earlier, it has still failed to become a success. As KFC is known more for its non-veg food, this also results in low demand for this item. It has a low market share and although low on expenditure (as company does not spend on its promotion), it does not bring in much revenue as demand is low. The product is mostly CASH NEUTRAL.

Cash Cow:
KFCs Chicken Bucket is the most successful product of the company. It has the highest market share amongst all the other products. It has good demand in the market and brings in huge sales revenue. The development and other expenses are also low and thus this product is a CASH SIRPLUS for the company.

Star:
The star product of the company is its crispy Boneless Chicken. It has a high market share and brings in high revenue. But it also has high developmental expenditure involved. The profit therefore is generally not very high brought in by this product. This product is CASH NEUTRAL for the firm. The company is trying make this product a cow as well, by reducing the expenditure

Marketing mix
1. Production
Product is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need. KFC is specifically dealing in the chicken products; KFC has the special raspy for chicken products and that is why KFC is known as a chicken specialist all over the globe. KFC offers a variety of products in chicken: PRODUCTS: Original recipe chicken Extra Tasty CrispyTM chicken Hot WingsTM pieces Tender Roast chicken Chunky Chicken pot pie Kentucky Nuggest Colonels Crispy Strips Honey BBQ sandwich Original Recipe Sandwich Tender Roast Sandwich Triple Crunch Sandwich Triple Crunch Zinger Sandwich

2. Pricing:
KFC during pricing their products keep different points in mind such as they adopt the cost base price strategy. Pricing of the product includes the Government taxes and excise duties and then they come at final stage of determine the price of their products. KFC prices of products are a bit high according to the market segment and it is also compatible to the stander of their products.

Calculation of the price under Cost Based Pricing Strategy: Total Pounds of Chicken Served in KFC Restaurant Annually = 1.914 Billion Total KFC Chicken Pieces Sold Annually = 5.89 Billion

Total Retail Sales = $8.9 Billion Sales Price of per Chicken Piece = Total Retail Sales / Chicken Pieces sold = $8.9 Billion / $5.89 Billion =$1.51 We assume that Fixed Cost is = $6000000000 Variable Cost Profit Margin is Or Mark Up = $675000000 = $225000000(25% of Sales)

Per Unit Variable Cost = $675000000 / 5890000000 = $ 0.115 Unit Cost = Variable Cost + Fixed Cost / Chicken pieces Sold = 0.115 + 6000000000 / 5890000000 = 0.115 + 1.02 = $1.135 Now suppose manufacturer wants to earn 25% mark up on sale. The manufacturer mark up price is calculated: Mark Up Price = Unit Cost / (1 Desired Return on Sales) =1.135 / (1-.25) = 1.135 / 0.75 = $1.51

3. Promotion:
Promotion is one of the necessary plates in any form of business or in other words you can say that promotion is the key of success. KFC knows the importance and significance of promotion so they use bill boards as the major source of advertisement. One of the most important platforms they use is media, especially

the newspapers to promote their products. They are also creating awareness among the masses about their existing product range as well they tell us about the future product. Marketing efforts to be taken by the restaurant: Paste delivery posters at petrol pumps, flats, colleges, plazas, and departmental stores. Distribution of delivery flyers in residential areas, markets, plazas and institutions (as per the plan) Visit offices and business places.

4. Placement:
In the case of the KFC the placement of the product is not important but the placement of the restaurant is important. The products of the KFC is cooked at the sport and then served after that. KFC Cavalry branch opened in June 1998, in the main commercial zone of Cavalry Grounds near the Jinnah Flyover. The restaurant is a three-story building including the basement (where the chicky play area is located). It is ideally located in the center of a main commercial and residential area of Lahore. The area that KFC Cavalry caters for is the residential and office area of Cavalry Grounds and Cantt, as the main target market. Another branch the KFC opened in the Lahore is in Garden Town (opposite to Barkat Market). KFC also target the Faisalabad and open its branch in D ground. Now we can easily judge that the KFC target the place for their restaurant, which is well known and is in the Porsche area where the income level of the people is high then the middle class level. Because the prices of the KFC products is high with comparison to the local products manufacturer who are dealing in the same kind of product in which KFC is dealing but the prices of the KFC is high due to special taste, high quality, and due to international brand, it is the world recognized fast food restaurant all around the world. So, for the placing strategy, KFC chose the well income class area for their restaurants.

SWOT
STRENGTHS Goodwill and reputation: The Company certainly has earned a good name and reputation by its previous products and services in the market. It is even more recognised in other markets outside India, where the company is among the leading fast food giants. The brand is recognised and trusted in India for its quality products, price, and customer service. It therefore has a good head start and enjoys a good chance of becoming a leader in Indian fast food industry. Employee Loyalty: Employee Loyalty is one of the major strengths of KFC. The turnover rate in the company is amongst the lowest in the industry. Customer Loyalty: Despite gain by Boston Market and Chick-fill A, KFC customer base remained loyal to the KFC brand because of its unique taste. KFC has continued to dominate the dinner and take out segment of the Industry. Ranks highest among all chicken restaurant chains for its convenience and menu variety. It generates $1B revenue each year.

WEAKNESSES
KFC was losing market share as other Chicken chain increased sales at a faster rate. KFC share of Chicken Segment sales fell from 71 percent 1999 , to less than 56 percent in 2009 , a 10 -years drop of 15 percent. Huge competition in this segment. India is still mostly a vegetarian dominated cultured society. South India is especially very much so. This may reduce the market share of the company. KFC has not yet invested much on R&D, and innovating new products for Indian Markets. This may lead to failure of their products as they are not in line with the Indian mind set, peoples taste and preferences and their likes and dislikes. This may prove fatal for the company.

OPPURTUNITIES
New Markets: Globalisation has opened doors for new markets for the company. As the developed markets are mostly saturated, the developing countries like India and China promises a good market and generation of demand in the future. With more than 70% of the markets in india being unexplored and un organised, KFC has a good scope of expanding its operations in the country. Cross Culture: Generally there is a good acceptance of American culture of fast food in India. People are opening up to fast foods more regularly in their daily lives and not just keeping it a once in a month affair. Thus Indian mindset is fast changing. Large Youth population: India has a very large share of youth population a compared to other countries. More than 60% of the population is under the age of 30yrs. As the young generation are more open to fast foods and demand it more, this is good news for the company.

 New variety: Company can also come up with new variety in the menu like Pizzas, garlic breads to attract more customers.

THREATS
Competition: Competitor companies like McDonalds are fast catching up with the market. McDonalds with sales of more than 19 billion in 1999, accounted for 15 percent of the sales of the nations top 100 restaurant chains. Organisations like PETA People for Ethnic Treatment for Animals have given a bad name to the company which may prove disastrous to the image of the firm. Currently, KFC is under massive attacks from animal organisations, questioning the way KFCs suppliers are threatening the chicken, before they got slaughtered. Anti-KFC campaigns, such as the one from PETA are affecting KFCs brand image in a negative way and result in direct dollar losses, as less people are consuming KFC chicken Saturated US Market: Now KFC cannot rely on just its home market to generate sales. As the US markets are already saturated and leave no or little scope for growth, company necessarily needs to look at offshore foreign markets to generate sales and keep up the profits.

Competitive analysis
You cannot enjoy the business without competitors. No organization can afford to ignore their competitors. It is very important for a marketing managers to monitor the activities of their competitors, what they are doing? KFC adopted such sort of strategy that there is no competitor for spicy chicken, which is made by KFC. Because the fast food market in India is highly competitive, KFC faces a wide number of direct and indirect competitors. KFCs main competitors are fast food chains such as McDonalds and Dominos, which are already well established throughout India. McDonaldss in particular is a direct competitor, as they have already successfully introduced their Salads plus line (http://www.theage.co.in), which directly targets healthy food conscious Indians. But, there are a number of other competitors that is also focusing on chicken types products. All this competition makes it quite difficult for KFC to maintain or even broaden their customer base.

KFC beats its competitors through the revising marketing strategy at every movement but the main competitor of KFC is Mc Donald.

Competitive Advantage

KFC

McDonalds

Spicy Products Indian people like spicy products instead of boiled food Arabian Rice and Zinger Burger Free Delivery Chicken is eaten by every community Local Staff and Highly Qualified because local staff can better deal with the customers

Burger and French Fries

Big Mac Charges for home delivery Beef is banned in some community Its Staff consist of simple Graduates and give them training

McDonalds Uses Top To Bottom KFC uses Top to Bottom and Bottom to Approach. Top Approach in Management. KFC is Co branding with Walls No such Case.

Strengths and weakness of competitor

S trengths: 38 products, Attractive Outlets, Huge Marketing, Budget, More

entertainment for kids

W eaknesses: Same type of Menu.

How they compete with their competitors?
It is found that KFC compete its competitors by five ways: KFC competes with its competitors through marketing strategy They offered different packages at different events like ramzan offer, midnight offer etc. KFC competes with their competitors by providing good services They must hired the hard selling persons to market their product in the market and motivate their employees for the sake of organizations and employees do well and they compete their competitors

KFC has quality products and through these quality products they compete their competitors

PESTEL Analysis
Political :
The operations of KFC are affected by the government policies on the regulations of fast food operation. Currently government are controlling the marketing of fast food restaurant because of health concern such as cardiovascular and cholesterol issue and obesity among the young and children in the country. Governments also control the license given for open the fast food restaurant and other business regulation need to follow such as for a franchise business. Good relationship with government in giving mutual benefits such as employment and tax is a must for the company to succeed in any foreign market.

Economic:
Though for last 1 year their was economic slowdown all across the globe but the sales of KFC and other fast food chains did not slow down to that extent that of other sectors in. The GDP (Purchasing Power Parity) is estimated at 2.965 trillion U.S. dollars in the year 2010. The GDP- per Capita (PPP) was 2700 U.S. dollars as estimated in 2008. The GDP- real growth rate in 2007 was 8.7%. India has the third highest GDP in terms of purchasing power parity just ahead Japan and behind U.S. and China. Foreign direct investment rose in the fiscal year ended March 31 2007 to about $16 billion from just $5.5 billion a year earlier. There is a continuous growth in per capita income; Indias per capita income is expected to reach 1000 dollars by the end of 2007-08 from 797 dollars in 2006-07. This will lead to higher buying power in the Hands of the Indian consumers. So taking into considerations the economic factors of India KFC is safe. The only danger to it will be if there is a terrorist attack in India and the victim is KFC.

Socio cultural:
India is the second most populous nation in the world with an approximate population of over 1.1billion people. This population is divided in the following age structure: 0-14 years 31.8%, 15-64 years 63.1% and 65 years and above 5.1%. There has also been a continuous increase in the consumption of fast food

in India. The social trend toward fast good consumption is changing and India has seen an increase of 90% fast food consumption from the year 2002- 2007. This increase is far greater than the increase in the BRIC nations of Brazil (20 per cent), Russia (50 per cent) and China (almost 60 per cent). Thus this shows a positive trend for fast food industries in India.

Technological:
The Indian fast food Industry is heating up with a lot of foreign players entering the Indian market. The technological knowhow and expertise will also enter the Indian market with an increase in competition. With the lower rates and increase technology the fast food counters are attracting youth by giving them attractive deals. For e.g. KFC and Dominos pizza. For a fast food restaurant, technology does not give a very high impact on the company and it is not a significant macro environment variables. However KFC should be looking to competitors innovation and improve itself in term of integrating technology in managing its operation. For example in inventory system, supply chain management system to manage its supply, easy payment and ordering systems for its customers and wireless internet technology. Implementation of technology can make the management more effective and cost saving in the long term. This will also make customer happy if cost savings results in price reduction or promotional campaign discount which will benefits them from time to time.

Environmental:
As one of world largest consumer of beef, potatoes and chicken, KFC always had been critics for world environmentalist. This is because high consumption of beef causing the green house effect by methane gasses coming from the cows ranch. Large-scale plantation has effect the environment and lost of green forest opening for plantation activities. Vegetarian environmentalist criticizes the fastfood giant for cruelty to animals and slaughtering. In America, once KFC want to

introduce whale burger causing uproar because whales are endangered species. Before using paper packaging, KFC once had been criticized for being insensitive to pollution because of using ne based packaging for its food products. Imagine millions of people purchase from fast food operator and how is the impact to world environment by throwing away those hard to recycle packaging. Our world is getting concern on environment issue and business operating here should not just care for profit, but careful usage of world resources for sustainable development and care for environment safety and health for our future generation. Critics and concern from all public or activist should be review and support if necessary to ensure we play our social responsibility better.

Legal factors:
As a certified fast food operator, there are many regulations and procedures that KFC should follow. For example is the Halal certification that becomes a concern to Muslim consumers. KFC should protect its integrity and consumer confidence by ensuring all materials and process are as claimed or must followed. Other legal requirement that the business owner should follow as stipulated in laws are such as operating hours, business registration, tax requirement, labor and employment laws and quality & environment certification (such as ISO) in which the outlet has been certified. The legal requirement is important because the offenders will be fined or have their business prohibited from operating which can be disastrous.

Questionnaire
1. Tick Your Choice ()
Perfect Above Average Average Below Average Poor

Food Quality Food Temperature Waiting Time

Menu Board Sitting Arrangement Restaurant Temperature Music Restaurant Cleanliness Overall Experience

2. When will you be back?

Next time I blink (very soon) May be sometime later When I win a Nobel Prize (Never)
3. How many people were in your group?

I was alone Just me and someone For me, three is company 4 or more

4. Would you rather order than Dine in?

Yaa, I like to mostly order at home Sometimes, but I mostly like to dine in No fun without Dine in

5. How close is your house to your nearest KFC outlet?

Within 1 Km Between 1 3 Kms Between 3 5 Kms Above 5 Kms

6. Do you want a KFC home delivery service?

My dreams are coming true That would help Doesnt make much of a difference No thanks

References
www.wikipedia.org www.yum.com www.datamonitor.com www.ebscohost.com www.kfc.co.in/ www.icmrindia.org/casestudies/catalogue/Business%20Ethics/BECG044.htm www.consumerpsychologist.com/intro_Product.html