KFC to Expand Steadily Into Africa
Yum! Restaurants International continues to expand its KFC footprint on the African continent and a carefully considered approach saw the number of KFC restaurants in new African markets grow to 63 at the end of 2012. The figure excludes South Africa, Egypt, Morocco and Mauritius, which included, brings the total number of KFC restaurants on the continent to almost 900 outlets.
By the end of 2012 KFC saw stores operating in Angola, Nigeria, Namibia, Botswana, Mozambique, Lesotho, Malawi, Swaziland, Ghana, Kenya and Zambia. KFC has plans to extend its reach to Zimbabwe, Tanzania and Uganda in 2013, with much longer-term growth plans to establish itself in the Democratic Republic of Congo, Ethiopia and Senegal.
KFC General Manager of New African Markets, Bruce Layzell, says the latest McKinsey Report suggests consumer-facing industries in Africa are expected to grow by more than $400-billion by 2020. “Africa is undoubtedly one of the fastest growing regions globally and KFC is fully committed to harnessing this opportunity and building a sustainable business model on the continent,” he says. This is further supported by the International Monetary Fund’s report in October 2012, which highlighted that economic conditions in sub-Saharan Africa have remained generally robust despite a sluggish global economy. The short-term outlook for the region remains broadly positive, and growth is projected at 5¼ percent a year in 2012–13.
This means not taking a “toe-in-the-water” type of approach. “KFC has established a dedicated department to focus on all aspects of optimising business in Africa, from marketing and supply chain, to infrastructure and human resources,” says Layzell.
He cautions that taking a blanket approach to conducting business in Africa does not work. “Nigerian businessman, Aliko Dangote, once said you can’t operate in Africa from the boardrooms of the US and Europe. This is a fundamental truth – you need to be on the ground to understand the complexities of each country in Africa. Our KFC restaurants in each market differ – our aim is to make our brand relevant in a local context. We won’t cut and paste a South African KFC into Nigeria or Zambia,” says Layzell. What doesn’t change, however, is KFC’s adherence to world-class food safety standards. Layzell says finding suppliers that meet KFC standards presents an ongoing challenge. “In this respect we partner with suppliers who are willing to invest in Africa or ensure local suppliers are up to speed and scale in order to meet our requirements. We can spend up to two years in advance of opening a store ensuring that suppliers meet our exacting standards,” he says.
Importantly, Yum! Restaurant International’s formula for success relies on putting people capability first. “We have done just that in our Africa markets and today we have trained about 2 100 customer facing KFC employees and 100 above store and restaurant support employees” says Layzell.
Typical challenges such as power shortages, quality building materials and potable water have not dampened KFC’s commitment to investing in Africa. KFC is steadfast in its strategic business approach to making sure it does things the right way up-front. “We will continue to do the “hard yards”, which will set us up for growth down the line. It’s a bit like climbing Kilimanjaro – make the end goal thoughtfulness, preparation and a steady gait will always beat fast and reckless,” says Layzell.
Date:16 January 2013