The Global Fast-Food Industry; The Kentucky Fried Chicken

             Colonel Harland Sanders signed up his first franchise in Salt Lake City, Utah in 1952. restaurant he owned, and began traveling across the United States to sell new franchises. Later that year he sold his first international franchise in Canada. By 1960 there were more than 200 Colonel Sanders Recipe Kentucky Fried Chicken (KFC) outlets. In 1963 revenues were over $500 million and the number of outlets had increased to over 300. In 1974 at the age of 74, he sold the business to Jack Massey and John Brown for $2 million, one of the great bargains in business history. The Colonel stayed on with the company in a ceremonial role, often helping to open new franchises.

             Brown and Massey grew the business throughout the United States over the next several years and in 1966 took the company public, listing it on the New York Stock Exchange and the Colonel was allowed to purchase the first 100 shares. The year 1969 was a crucial one in the history of the company with the first major penetration into international markets outside North America by acquiring franchises in England and Japan. By 1971, there were more than 2400 franchises and 600 company-owned restaurants spread throughout the United States and 47 other countries.

             1971 became another key year in company history with the sale of KFC to Heublein. This was Heublein"s first significant entry into the restaurant business and it did not go smoothly. By 1977 restaurant quality had declined and the Colonel was upset. Only about 20 new restaurants were being opened per year. In response, Heublein implemented a new strategy emphasizing clean restaurants, product consistency across franchises and better service. Old franchise buildings were remodeled. .

             In 1982 R. J. Reynolds Inc. (RJR), in an attempt to diversify beyond the tobacco business, acquired Heublein for $1.2 billion. KFC was profitable and growing again, but Colonel Sanders never saw the end result of Heublein"s strategy in the late 1970"s, because he died in 1980.

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