Warc, 25 April 2014
SHANGHAI: Western restaurant brands such as Pizza Hut and
McDonald's are planning further expansion in China, with many developing
breakfast menus in new moves to attract local diners.
Yum Brands, owner of Pizza Hut and KFC, expects to open at
least 700 new restaurants in the country during 2014; 123 new units have already
opened during the first quarter.
Yum Brands recently reported increased sales and profits
which it attributed in part to an overhaul of its menus. That momentum
continued with a new breakfast menu unveiled earlier this week to be served in
300 Pizza Hut branches.
China Daily noted that Western chains, from KFC to
Starbucks, were increasingly targeting breakfast with menu items such as coffee
and cakes. As a result, traditional Chinese restaurants and stalls were
struggling for trade, despite their steamed buns and soybean milk being
significantly cheaper.
A number of reasons were evinced for this development,
including food scares, which have resulted in white collar workers trusting
western restaurants to supply safe and good quality food, and a more pleasant
dining environment.
Beyond breakfast, Gao Jianfeng, general manager at
Shanghai-based Bogo Consultants, also observed the impact of the government's
austerity campaign which, he told China News, had "pushed customers to
more casual and lower-end restaurants … [and] stimulated the sales at such
restaurants as Pizza Hut".
The breakfast scrap taking place in China is, however,
merely the latest iteration of a wider battle between western quick-service
restaurants. Bloomberg recently reported how, in the US, McDonald's had reacted
to a new Taco Bell (another Yum Brands outlet) breakfast menu item – waffle
tacos – with an offer of free coffee.
McDonald's too is seeking to add another 300 outlets in
China through increased franchises. Zeng Qishan, McDonald's China CEO, recently
indicated his intention to double the proportion of franchised stores from 12%
to 25%, although even that figure is a long way behind its global average of
80%.
While there will be a focus on first-tier cities, Gao said
that McDonald's locations in second- and third-tier cities were losing to those
of KFC.
Data sourced from China Daily, China News, Bloomberg TV;
additional content by Warc staff
No comments:
Post a Comment