Both KFC and McDonald’s have been struggling to keep market share in China by expanding fast. Localizing has become a key word, but sometimes at the expense of quality, says business analyst Ben Cavender in AdAge.
The U.S. giants have also faced headwinds from questions over their chicken supply, avian flu fears and a slowdown in economic growth. McDonald’s China comparable store sales were down 3.6 % in 2013 from 2012. KFC is also revamping its China offering, with an updated menu and much-needed store renovations.
“One of the problems KFC had is they’ve expanded so quickly they haven’t done a good job of cleaning up and modernizing stores, whereas McDonald’s has been very aggressive about doing that,” said Ben Cavender, principal at China Market Research Group. “We’re starting to see a shift where consumers are saying they actually like the McDonald’s dining experience, more than at KFC.”
McDonald’s is also getting more aggressive about store openings: Last year it debuted 275 China locations and this year it plans 300.
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