According to the facts provided in the case, China has historically been unappealing to fast food chains. Because to the stringent regulatory restrictions that applicants had to meet, franchising in China was tough. As a result, the country was historically unsuitable for a fast food franchise, as proven by McDonald's and KFC's failure to franchise despite their success in other countries (Zeng, Go & Vries, 2012). Yet, since the implementation of legislation that protect both the franchisor and the franchisee, the country has become more appealing to fast food franchisors. The advantages of doing business in China include a huge population and hence a high number of fast food consumers throughout the country. Despite the cultural practices in China, the locals engage in fast-food consumption and thus an opportunity for fast food industry. Some of the obstacles include lack of well-trained workers leading to the need for importation of labor thus making it expensive (Zeng, Go & Vries, 2012). If I were the manager of Wendy's, I would invest in China because of the numerous opportunities offered by the market.
Some of the approaches utilized by the two companies include menu selection. Both KFC and McDonald invested in menu selection to ensure they have maintained the local consumers who love to eat Chinese foods by including them in the menu. As opposed to McDonald who brought their supplier partners in China, KFC invested in local suppliers who became their new partners (Zeng, Go & Vries, 2012). Additionally, KFC invested in well-trained employees including importing them from neighboring countries to ensure the best services to their customers. As well, KFC utilized high compensation strategy thus the opportunity to hire the best employees. KFC was also quick to train local employees to improve local talent and hence attract local consumers. Unlike KFC, McDonald started its expansion from south to north and hence less successful (Zeng, Go & Vries, 2012). On the other hand, KFC expanded successfully in China by starting from the major eastern cities and concluding with the towns on the western side.
The strengths of the KFC model is the ability to conquer the major cities bearing the largest populations. As such, the company was able to capture the largest number of consumers in all the largest cities. The other strength of KFC approaches is the ability to maintain local consumers by incorporating local delicacies through utilization of highly trained local employees. Some of the weaknesses of KFC approaches is the inability to franchise in the country (Gao, 2013). The strengths of McDonald approaches include the ability to maintain their global partner and suppliers and hence entry into new markets. The weaknesses of McDonald approaches include the inability to expand successfully in major cities and hence unable to compete with other fast food dealers.
Some of the international strategies that can be drawn from this case is the ability of a company to integrate local products to satisfy both local and international consumers. Another strategy is the form of marketing utilized by the two companies. The two companies have been successful in China due to the marketing strategies that can be viewed globally to enhance brand image (Gao, 2013).
References
Gao, Z. (2013). Revisiting the Golden Arches in China: The Chinese Discourse on McDonald's between 1978 and 2012. Journal of Macromarketing, 33(4), 288-305.
Zeng, G., Go, F., & de Vries, H. J. (2012). Paradox of authenticity versus standardization: Expansion strategies of restaurant groups in China. International Journal of Hospitality Management, 31(4), 1090-1100.
