Tony Sagami takes a closer look at the success of American fast food restaurants in China. In this issue of Money and Markets, Mr. Sagami discusses how Pizza Hut and KFC are both adapting to the Chinese culture in order to produce huge demand in China and throughout Asia.
Jupiter, FL (PRWEB) June 19, 2008 -- Tony Sagami takes a closer look at the success of American fast food restaurants in China. Mr. Sagami discusses how Pizza Hut and KFC are both adapting to the Chinese culture in order to produce huge demand in China and throughout Asia.
Yum Brands, the parent company of Pizza Hut, KFC, Taco Bell, Long John Silver's, and others, is the largest restaurant chain in the world. It has over 34,000 stores, but more than 14,000 of them are outside the U.S. and concentrated in Asia. In China alone, Yum operates more than 2,000 KFCs and 300 Pizza Huts. In fact, more than 50% of Yum Brands' revenues come from outside the U.S.
Pizza Hut and KFC are two of the most popular restaurants in China. According to A.C. Nielsen, KFC is the top consumer brand in China, even ahead of Coca-Cola and Nike. Very few Chinese will ever have the chance to set foot in the U.S. so dining out at KFC or Pizza Hut is as close as they will get to visiting America. Plain and simple, the Chinese love KFC and Pizza Hut. The reason for the success is that Yum Brands has been able to take advantage of the Chinese's passion for American products and they have succeeded in tailoring their menus to local tastes across China. The menu is different from the United States, with smaller portions and new entrees featuring popular local ingredients.
Pizza Hut takes that localization strategy even further. In Taipei, they serve sashimi pizza; in Kualu Lumpur the locals love chicken satay pizza; in Shanghai, sea eel is the most popular; and in Thailand they add a can of tuna on top of their pizza. The packaging is American, but the tastes are definitely Asian. Plus, the Chinese consider KFC and Pizza Hut to be upscale restaurants, unlike Americans. The restaurants are bright, lavishly decorated, and have impeccably clean bathrooms.
"However, not all American restaurants are as profitable as the YUM restaurants. McDonald's, for example, had a big head start over Yum Brands in China but its U.S. menu has struggled to gain popularity with Asians. The main reason is that Asians prefer chicken and seafood over beef. Plus, a hamburger is still a hamburger even if you throw a pineapple ring and teriyaki sauce on it," Sagami states.
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http://www.moneyandmarkets.com/Issues.aspx?Where-the-Chinese-Spend-Fathers-Day-1890
About TONY SAGAMI & MONEY AND MARKETS
Tony Sagami, a veteran investment advisor and a leading expert on Asian markets, is the owner and founder of Harvest Advisors, an investment research and money management company. Mr. Sagami has been managing money for more than 20 years and is one of the early pioneers in the application of technical and quantitative analysis to mutual funds and stocks. He is a featured contributor to Weiss Research's daily e-letter, Money and Markets and monthly Safe Money Report as well as the editor of Asia Stock Alert.
Prior to establishing his own firm, Mr. Sagami was managing director at W.E. Donoghue & Co, serving additionally as the director of investment. During his successful career, he also held the position of account executive at Merrill Lynch.
Mr. Sagami's views on Asian markets, specifically Chinese investments, have been featured in publications such as The Wall Street Journal, Barron's, Kiplinger's, Smart Money, Business Week, New York Times, Washington Post, Investors Business Daily, Bloomberg, Financial Planning Times, Mutual FundsMagazine, Chicago Tribune, and the LA Times, as well as on CNBC and CNBC Asia.
Mr. Sagami holds a degree in economics from the University of Washington.
Money and Markets (www.moneyandmarkets.com) is a free daily investment newsletter from Dr. Martin Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Weiss Research, Inc. is located in Jupiter, Florida. For more information about our editors, or to set up an interview, please contact Jennifer Moran at 561-627-3300 or visit www.moneyandmarkets.com.
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