KFC won China by becoming less American, not more.
KFC opened in Beijing in 1987 with managers from Taiwan and built its own supply chain. By 2024, KFC's 11,648 China stores generated $8.5 billion.
Transcript
In November 1987, KFC opened a restaurant near Tiananmen Square. Its managers were not flown in from Louisville. They came from Taiwan.
KFC could export the American model, with expat managers and a local supply chain it rented. Or it could localize. It hired Taiwanese veterans who understood Chinese culture from the inside. And because in 1987 China there was nothing to rent, KFC built its own supply chain.
The first Beijing KFC seated 500 people and cost about $1.1 million to build. In 1988, its first full year, it sold the equivalent of about 300,000 chickens, more than any other KFC in the world, and cleared over $3 million in sales. It was not a straight line. In January 2013, during a chicken-supply scandal, KFC's same-store sales fell 41%. By 2024, KFC's 11,648 China stores generated $8.5 billion.
That was the bulk of Yum China's record $11.3 billion in revenue, and net profit climbed 10%, to $911 million.
KFC won China by becoming less American, not more. One case cannot tell you to localize everything. It does say this: when a market lacks what your model assumes, build it yourself, and staff it with people who know the place.
The records behind this video
Every figure in the video comes from this Decision Record, each with its sources.
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