#175 Eat more chicken, globally!
Atlanta-based U.S. fast-food chain Chick-Fil-A currently offers food at 2,700 restaurants in nearly every U.S. state, as well as a few select stores in Canada and Puerto Rico. Now the company is looking to grab a bigger bite of the global market.
Chick-Fil-A has had failed attempts in international markets. From 1996 to 2001, Chick-Fil-A was present in South Africa, but then withdrew because the company failed to build brand awareness. In 2019, the company failed to establish a market in the United Kingdom when it pulled out after widespread protests over the company’s donations to anti-LGBTQ organizations.
But the company didn’t give up. Soon after, in 2021, CEO Dan Cathy, son of founder Truett Cathy, announced that international expansion was again on the horizon, and the chicken giant opened restaurants in Canada. And just last week, in March 2023, the founder’s grandson, Andrew Cathy, outlined the company’s next steps in global markets.
The company, best known to customers for its fried chicken sandwiches and impeccable service, and to franchisees for low cost of entry and one of the highest sales per location, plans to invest $1 billion in markets in Europe and Asia.
Chick-Fil-A is clearly planning for the long haul. The first restaurants will open in 2026, and in the years leading up to 2030, the chain plans to focus on five international markets.
With $16.7 billion in sales, Chick-Fil-A is the third largest restaurant chain in the United States, surpassed only by McDonald’s and Starbucks. Internationally, however, competition is fierce, and one wonders if Chick-Fil-A will be able to compete with the other chicken giant, KFC, which currently operates 24,000 restaurants worldwide and opened a new restaurant EVERY TWO HOURS between 2021 and 2022? Size matters, and you can’t discount KFC’s long history in China that comes with a deep understanding of the market and the political environment, which the company has leveraged very successfully. It’ll also be interesting to see if Chick-Fil-A’s restrictive policy of retaining ownership of all restaurants will fly. Time will tell if people will eat more chicken globally!
March 19, 2023 @ 9:42 am
Chick-Fil-A, or better: Chick-Fail-A? The lack of building brand awareness is a rookie mistake in my opinion. What had been learned from fast-food giants is rather clear: it does not (primarily) matter what you serve, you merely need to serve a brand, a motto, or a lifestyle.
In Europe, and especially Germany and Austria, Chick-Fil-A is not very well known, except for within the younger generation because (American) influencers often refer to it, hence we are curious whether the expansion will bring the experience of Chick-Fil-A to us as well.
Undoubtedly, KFC is one of the most important competitors of Chick-Fil-A and needs to be observed. Interestingly though, KFC does not have a great success story in central Europe. It is rarely seen; McDonald’s and Burger King are dominating the market. KFC once tried to set foot in Austria and failed tremendously. I wonder whether Chick-Fil-A provides a better strategy.
In my opinion, Chick-Fil-A should consider being more open toward franchising. Franchising is the trend more than ever, which would allow them to save costs and yet be paid percentages of the profit.
March 20, 2023 @ 10:45 pm
I was surprised to hear that the company made donations to anti-ldbtq organizations as this is something that should have also raised red flags in the US.
Entering the European Market, it is probably wise for the company to start there as it is the European market that is closest to the US market. And once they establish a foot there, afterwards they should then expand to other European markets. I think the company should also look closely at what McDonald´s did when they entered the European Market initially and learn from their mistakes and successes. For example, especially within the European Union it would help if the meat is sourced locally (as McDonald´s also does) and include regional ingredients in their products and advertise them as such.
The whole environment issue should help them as well. This was also a main reason behind founding the company and it should be represented in their brand awareness strategy in Europe as well, since climate protection is a very important trend and beef production is identified as one of the main culprits of Co2 Emissions. When entering the Chinese market, a study should be conducted if the same brand strategy works there as well or if a different approach has to be used based on cultural differences towards the environmental protection subject.