KFC and Its Franchising Strategy Essay Example | Topics and Well Written Essays - 1000 words

KFC and Its Franchising Strategy - Essay Example Presently the company has 15000 outlets with its presence in more than 105 countries (KFC, â€Å"About us†). It has almost 455000 employees. Currently, the company has a turnover of $15 billion. The success of the company is mainly due its product and a sound marketing strategy. However, the international expansion of the company also added to its huge success. The company undertakes its international expansion with franchise system. A franchised system is a process by which the company allows another organization to use its name and market its product. The organization which uses the name of the company to market the products is known as the franchisee. A franchisee thus holds the right to market the products in a particular geographic area (â€Å"Franchise†). KFC operates with franchise system in the international arena. The company was also highly benefitted by this type of operation as the financial risk was greatly minimized and company had taken other risks agains t it. Also, the franchised system has helped the company to understand the culture of the local community and develop the product line accordingly. For example in India, the company never sells any beef product as it is against the social culture. However, in countries like Pakistan, Afghanistan and other places of the world, the company sells beef products. As a consequence, the franchised system helps the company to adapt according to the regional taste. Also, the franchised system helped the company to decide the pricing strategy. It has a network of 1500 franchisee (Yum franchises, â€Å"Yum brands†). The international franchising strategy of the company is both offensives as well as defensive and thus made the firm less dependent on the home country about the revenues and demands. The company has also been able to generate high profits from international franchising strategy. Moreover, the franchising has system has driven the company to the international avenue. The fra nchising strategy of the company has also helped the company to accomplish the following:- International brand recognition by making its presence all over the world. The company strategically has chosen franchised mode apart from other modes of operation, as the franchised system offered less financial burden and also allowed the company to adapt according to the local culture. Franchise mode is also a safe way of conducting the business. It also allowed KFC to undertake an end to end marketing and distribution system. Hence on a whole, it can be concluded that apart from its product mix, promotional technique and other competencies franchised system hugely helped the company to grow their business into a global organization. Skoda and its Positioning Strategy Skoda is an automobile manufacturing and marketing company based in Czech Republic (â€Å"Volkswagen aims at becoming top global car-maker riding on the Skoda† 2011). However, in the year 2000 Skoda became a fully owned subsidiary brand of Volkswagen Auto group of Germany. The brand is mainly positioned as the entry brand of the entire brand. Within the group, the company was positioned at even higher than Volkswagen. It started the venture by manufacturing what is known as people’s car. Nowadays Skoda is positioned as the alternative of Volkswagen. Hence it can be clearly stated as the positioning strategy of Skoda was based on its features. It has successfully positioned itself as the family car which offers value to the price.  Ã‚