KFC challenges Starbucks to launch freshly ground coffee

Coffee is becoming an important part of KFC's future. The fast food chain, which relies on the Chinese market, has decided to fully launch its freshly ground coffee business in its restaurants from 2015.

Pat Grismer, Yum's chief financial officer, said at an investor meeting on March 3 that the current performance of China's coffee business is very satisfactory. The new coffee business has helped improve KFC's breakfast and afternoon tea business.

KFC plans to expand its coffee business to at least 2500 stores across the country by the end of this year, double the previous estimate of 1000. Starbucks has more than 1500 stores in China, while McDonald's has 2000 stores and sells coffee products. Now KFC has more than 4800 stores in China and has broad prospects for market expansion.

In early November 2014, KFC took the lead in launching a freshly ground coffee series in Shanghai, using Arabica coffee beans, priced between 10 and 20 yuan. In every restaurant that serves freshly ground coffee, KFC is equipped with a professional coffee maker, and in a corner of the cashier, the restaurant also hangs a sign with the word "COFFEE". In order to cooperate with the sales, in the afternoon tea time, you can also get egg tarts, hamburgers and other foods at a discounted price. After January 2015, KFC launched a series of freshly ground coffee in Beijing, Guangzhou and Shenzhen.

According to he Yong, vice president of brand planning of KFC, freshly ground coffee has been seen in restaurants in Shanghai, Beijing and other places since 2009. KFC tried different coffee beans, coffee machines and different processes, and launched four series of coffee products before and after. KFC said it was "tangled" by making a decision between a flower-drawn series with a beautiful appearance and a fresh-grinding series with a well-balanced flavor. After a number of consumer tests, including concept testing and blind taste testing, KFC selected similar restaurants from Beijing and Shanghai in May 2013, carried out simultaneous testing of the two product series, and finally chose the current grinding series.

Of course, even if it offers freshly ground coffee similar to Starbucks, it doesn't mean that people will ignore its identity as a fast food restaurant, which is different from the culture that Starbucks conveys.

However, KFC believes that its average 10 yuan coffee has a price advantage, and Starbucks' price positioning is an average of 30 yuan.

KFC did not launch McCoffee, a special brand of coffee, as McDonald's did, but with the introduction of coffee, KFC is also revamping its restaurants. Since 2014, KFC has launched a new restaurant based on "Dining Room", using custom hanging pictures, drooping downlights, green partitions and long bars to create the concept of "restaurant at home".

He Yong revealed that by the end of 2014, KFC had opened more than 370 new concept restaurants across the country. All the new KFC restaurants opened in 2015 will adopt new ideas, and the transformation of old restaurants will be accelerated.

In 2014, Yum, the parent company of KFC, performed poorly in China due to the Husi expired meat incident. In the fourth quarter of 2014, total sales in China, which accounts for nearly half of Yum's revenue, fell 11% from a year earlier, and same-store sales fell 16%. In addition to food safety issues, Chinese consumers' eating habits have changed greatly, and now eating like KFC or Pizza Hut has changed from a cool choice to just another choice.

The large fast food company, which relies on the Chinese market, needs to look for new growth points in this market. KFC has previously launched more food with Chinese characteristics in order to cater to the market, such as adding porridge and Youtiao to its breakfast. serving old Beijing chicken rolls and rice, now it may think coffee may be a good new opportunity.

(interface reporter Yuan Yuan)