Yum! Brands is an American fast food Company, headquartered in Louisville, Kentucky; formerly known by the name Tricon Global Restaurants. It has four subseries namely, Taco bell, Pizza hut, KFC and Wingstreet; franchised all over the world. Long Jhon silvers and A&W restaurants was also owned by yum! Brands.
BCG matrix is portfolio analysis for the companies, which has different segments or profit centers. Each division require special attention from the management in terms of strategic decisions. The strategies can be identified via BCG matrix. There are four components of BCG matrix i.e. Question mark, stars, cash cows and dogs. The question arises here; how can we identify that which segment fall under which component? Companies can identify it through industry growth rate and segment market share. As mentioned above that, Yum! Brands has 4 segments, each individual segment requires different strategy to generate maximum profit for the company. Following is the detailed BCG analysis of Yum! Brands.
Question Mark
Dogs are associated to those segments, which are operating in high growth industry and have relatively low market share. Long john silver is a chain of fast food restaurants, famously known for its seafood. In 2011 it suffered from inadequate sales; which resulted in the decline of market share, in high growth industry. The strategies require for such segments are; weather to sell the segment or invest more money. As Yum! Brands has other segments, which market share was very high compare to this segment, company decided to sell the segment to focus on the profitable segments.
Stars
Stars are those segments which have potential of long-term growth and profitability. Such segments operate in high growth industry and have high market share. KFC and pizza hut fall in the category of stars, both segments performance are good in terms of revenue generation in 2015. KFC are positioned 4th in the ranking, with brand value of 12.3 billion in addition, Pizza hut was ranked 5th with brand value of 8.3 billion. Such segment requires to focus on market development. Yum! Brands followed the same strategy and expand their market by opening over 700 franchises of KFC and Pizza hut in China in 2013.
Cash Cows
Those segment which comes in cash cows category have low market sale growth and high market share. Taco bells fall in to the category of cash cow, it has low market growth, for the reason that; most of the items offered in the menu are Mexican and Texan i.e. Nacho, taco, burrito etc. such segments should use the market development strategy to expand their market.
Dogs
A&W was one of the Yum! Brands segment but due to low market share and low industry sale growth rate it was sold. Such segment which has low market growth and low market share comes in to the category of dogs in regard to BCG matrix.
References
Brand value of the 10 most valuable fast food brands worldwide in 2016 (in million U.S. dollars). Retrieved from.
https://www.statista.com/statistics/273057/value-of-the-most-valuable-fast-food-brands-worldwide/
Annual Report of yum brands. Retrieved from.
http://www.yum.com/app/uploads/2015YumBrands_AnnualReport.pdf
The California Taco Trail: ‘How Mexican Food Conquered America’. Retrieved from.
http://www.npr.org/sections/thesalt/2012/04/23/150886690/the-california-taco-trail-how-mexican-food-conquered-america#
Yum Sells 2 Fast-Food Chains. Retrieved from.
https://dealbook.nytimes.com/2011/09/22/yum-sells-2-fast-food-chains/?_r=0
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