Case study on Ethical Issues faced by

Kentucky Fried Chicken (KFC)

Submitted by:

Akanksha Gupta- HRD1714108

PGDM Batch of 2017-19

Balaji Institute of Management and Human Resource Development

(BIMHRD)

Sri, Balaji Society, Pune

DECLARATION

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This case study has been entirely prepared by me and does not involve plagiarism.

It is my own work and has not already been published or submitted elsewhere.

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 TABLE OF CONTENTS

Particulars Page no.

Executive Summary 4

Introduction 5

Overview 7

Organisation history 11

Analysis 15

Status 21

Case solution 23

Annexure 24

References 26

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 EXECUTIVE SUMMARY

Kentucky Fried Chicken is one of the well-known fast food restaurants in the world. The
industry was founded by Colonel Sanders. The corporation is based in Louisville, Kentucky and
now regarded as the most famous chicken restaurant chain.

There are many ethical issues that an organisation face and one of the organisations which faces
major issue is the Kentucky Fried Chicken. In my report, I would analysis about the issue faced
by KFC and the ethical problems that the company encounters. Despite of the established brand
of KFC Corporation and contrary to its previous achievements; it seems that there is a need for
the management to redefine its image.

Growing population of today is obviously different from the population of the previous decades
in terms of health and nutritional attitudes and behaviours. Obviously, the reason for this
increased awareness is because of the fact that information seem to link fast foods with the
growing number of obesity.

Being one of the most popular fast food restaurants it is important the company adheres to ethical
standards specifically in terms of providing healthy foods. However, it has been observed that
KFC is using oil which contains fatty acids and contain in monosodium glutamate. This is noted
to increase cholesterol and even increased the risk of having heart disease and obesity.

Since the late 1990’s KFC has faced severe protests by People for Ethical Treatment of Animals
(PETA), an animal rights protection organisation for the ill treatment of chickens by the worker
at the slaughterhouses. PETA accused KFC of cruelty towards animals and released a video
tape showing ill treatment of birds in KFC’s poultry farms. Understanding the significance of
cultural, economic, regulatory and ecological issues while establishing business in any country
is necessary. Failure of this led severe protests against KFC when it started its business
operations in India.

Promoting highly processed "junk food" in a poor country with widespread malnutrition is
unethical were the charges. In spite of all the issues, KFC continued to resolve the problems by
engaging in auditing of slaughterhouses, prevention of malpractices by checking through
cameras at farms. KFC continues to be one of the biggest fast food chains amongst the Non-

Vegetarian especially in Chicken segment all around the world.

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 INTRODUCTION

Business ethics are moral principles that guide the way a business behaves. The same principles
that determine an individual’s actions also apply to business

A company must make a competitive return for its shareholders and treat its employees fairly.
A company also has wider responsibilities. It should minimise any harm to the environment and
work in ways that do not damage the communities in which it operates. This is known as
corporate social responsibility

The main purpose of this report is to conduct an ethical analysis for KFC Corporation. The
report examines main ethical dilemmas facing KFC, specifically including the perspective of
the consumers, the suppliers, the employees and society as a whole. Although it is the world's
most popular chicken restaurant chain, KFC is currently experiencing a number of ethical
dilemmas. For instance, the dilemma between consumers' need for healthy food and the reality
of providing high-calorie food, and the dilemmas concerning the relationship between KFC and
its suppliers, between KFC and its employees. There are many ethical dilemmas that this
organisation has faced.

Chicken welfare issue- The chickens are stuffed by tens of thousands into overcrowded sheds
where they hardly find space to move freely. To save space and avoid chicken hurting each
other, the sensitive chicken beaks are cut off with hot blade without giving any painkillers.
Overcrowding and poor litter quality in the farms also caused painful ammonia burns on the
chickens. The injured chickens received no treatment and had to bear the pain throughout their
life

Improper breeding- PETA claims that slaughter techniques are inhumane, chickens throats are
slit and the animal are dropped into tanks of scalding hot water to remove their feathers, often
while they are still conscious and able to feel pain.

Cultural heritage- KFC entered India in 1995 and has been in midst of controversies since
then. The regulatory authorities found that KFC chickens did not adhere to the Prevention of
Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium
glutamate (flavour enhancing ingredient) as followed by the Act. Since the late 1990s, KFC
faced severe protest for People for Ethical Treatment of Animals (PETA), an animal rights

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protection organisation. However, undeterred by the protest by PETA and other animal rights
organisation, KFC planned a massive expansion program in India. Foreign fast food companies
were allowed to enter India during the early 1990s due to the economic liberalization policy of
the Indian Government. KFC was among the first fast food multinationals to enter India.

On receiving permission to open 30 new outlets across the country, KFC opened its first fastfood
outlet in Bangalore in June 1995. Bangalore was chosen as the launch pad because it had a
substantial upper middle class population, with a trend of families eating out. It was considered
India's fastest growing metropolis in the 1990s. Apart from Bangalore, PepsiCo planned to open
60 KFC and Pizza Hut outlets in the country in the next seven years. However, KFC got
embroiled in various controversies even before it started full- fledged business in India.

From the very first day of opening its restaurant, KFC faced problems in the form of protests
by angry farmers led by the Karnataka Rajya Ryota Sangha (KRRS). The farmers leader,
Nanjundaswamy, who led these protests, vehemently condemned KFC's entry into India, saying
that it was unethical to promote highly processed 'junk food' in a poor country like India with
severe malnutrition problems.

Nanjundaswamy expressed concern that the growing number of foreign fast food chains would
deplete India's livestock, which would adversely affect its agriculture and the environment. He
argued that non-vegetarian fast-food restaurants like KFC would encourage Indian farmers to
shift from production of basic crops to more lucrative varieties like animal feed and meat,
leaving poorer sections of society with no affordable food.

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 OVERVIEW

KFC Corp. is based in Louisville, Kentucky, and is a subsidiary of Yum! Brands, which also
owns Pizza Hut and Taco Bell. Yum! Brands has almost 42,000 restaurants in more than 125
countries and territories, making it one of the world’s largest restaurant companies. Over the
years, KFC franchisees have had the option to co-brand with Taco Bell or Pizza Hut.

According to company figures, the KFC system serves more than 12 million customers daily.
Most purchases are take out or to-go, although the stores also offer in-store dining. In 2015,
Yum! Brands announced that KFC would begin deliveries by 2016, further expanding its
reach to customers. KFC engages in extensive marketing to keep the brand in consumers’
minds: KFC claims an average of more than 185 million people see a KFC commercial at least
once a week. KFC is also a pioneer in the use of social media to attract and engage customers.

KFC franchisees receive ongoing support through The Yum! Value Network, which offers
programs and support that include brand recognition, customer attraction, competitive
advantage, franchise value system, multi-unit growth, economic stability, giving back to the
community, development expertise, access to financing, solid business support, quality
onboarding and training, a reliable supply chain, and return on investment.

KFC’s major source of revenue is now China, and the company is expanding its operations in
Asia, making up 49% of the company’s revenue. Currently, KFC Holdings has more than 640
restaurants in India, Cambodia, Brunei, Singapore, and Malaysia. The ever-increasing
popularity of KFC in Asia is particularly evident in Indonesia, as well. The country has 439
outlets, more than any other Western restaurant in the country.

Management

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Operational level

Corporate level

KFC Philosophy – The CHAMPS Program

KFC follows the CHAMPS method to ensure that the customer has the consistent quality
experience in every restaurant, every day and on every occasion.

C- Cleanliness

H- Hospitality

A- Accuracy

M- Maintenance of facilities

P- Product quality

S- Speed service

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Financial information:

Cash Investment: $750,000

Net Worth: $1,500,000

Franchise Fee: $45,000

Total Investment: $1,309,900

Royalty Fee: 5% of Gross Revenues

5% of Gross Revenues (Includes national and local

Advertising Fee:
contributions)

KFC Problems worldwide:

• KFC is being sued for using oils which contain trans – fat
• Facing several protests of PETA
• KFC three piece chicken contains more than 15g of trans- fat.
• KFC suppliers are injecting growth hormones to chicken Conflicts with KFC and its
Franchisees.

The case highlights the ethical issues involved in Kentucky Fried Chicken's (KFC) business
operations in India. KFC entered India in 1995 and has been in the midst of controversy since
then. The regulatory authorities found that KFC's chickens did not adhere to the Prevention of
Food Adulteration Act, 1954. Chickens contained nearly three times more monosodium
glutamate (popularly known as MSG, a flavour enhancing ingredient) as allowed by the Act.
Since the late 1990s, KFC faced severe protests by People for Ethical Treatment of Animals
(PETA), an animal rights protection organisation. PETA accused KFC of cruelty towards
chickens and released a video showing the ill-treatment of birds in KFC's poultry farms.
However, undeterred by the protests by PETA and other animal rights organisations, KFC
planned a massive expansion programme in India. The case is structured to enable the students
to:

• Understand the significance of cultural, economic, regulatory and ecological issues

while establishing business in a foreign country

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• Appreciate the need for protecting animal rights in developed and developing countries
like India

• Understand the importance of ethics in doing business

• Examine the reasons for protests of PETA
• Identify solutions for KFC's problems in India.

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 ORGANISATION HISTORY

KFC was founded by Colonel Harland Sanders, an entrepreneur who began selling fried chicken
from his roadside restaurant in Corbin, Kentucky, during the Great Depression. Sanders
identified the potential of the restaurant franchising concept, and the first "Kentucky Fried
Chicken" franchise opened in Utah in 1952. KFC popularized chicken in the fast food industry,
diversifying the market by challenging the established dominance of the hamburger. By
branding himself as "Colonel Sanders", Harland became a prominent figure of American
cultural history, and his image remains widely used in KFC advertising to this day. However,
the company's rapid expansion overwhelmed the aging Sanders, and he sold it to a group of
investors led by John Y. Brown Jr. and Jack C. Massey in 1964.

Based in Louisville, Kentucky, KFC Corporation is the franchisor of the world’s most popular
chicken restaurant chain, specializing in Original Recipe®, Extra Crispy™, Kentucky Grilled
Chicken® and Extra Crispy™ Tenders with home-style sides, Hot Wings™ pieces and freshly
made chicken sandwiches. Famous for its Original Recipe® fried chicken, which is made with
the same secret blend of 11 herbs & spices that Colonel Sanders perfected more than a half-
century ago, KFC has been serving customers complete, freshly prepared family meals since
Colonel Harland Sanders founded the concept in 1952.

It is estimated that, on average, more than 185 million people see a KFC commercial at least
once a week—that’s more than half the U.S. population. The KFC system serves more than 12
million customers each day in more than 115 countries and territories around the world.

KFC operates more than 17,000 restaurants in the United States and internationally. KFC’s
parent company is Yum! Brands, Inc., the world’s largest restaurant company in terms of system
restaurants, with more than 40,000 locations in more than 130 countries and territories and
employing more than one million associates. Yum! is ranked number 201 on the Fortune 500
list, with revenues exceeding $13 billion in 2012.

Responsibility:
Food promise- Throughout each day, trained cooks freshly prepare fried chicken using the

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 Colonel’s Secret Recipe of 11 herbs & spices. It takes more than 25 minutes to hand bread and
cook our chicken before it’s ready for your bucket or boxed meal. That’s why KFC has the
world’s best chicken.
• We use 100 percent real chicken raised on U.S. farms.

• Our chicken is USDA inspected for quality before it can be delivered to our kitchens.

• Our chicken is free of added hormones and steroids. In fact, FDA regulations prohibit the
addition of hormones in poultry in the U.S.

• As of January 1, 2019, all chicken purchased by KFC U.S. is raised without antibiotics
important to human medicine, as defined by the World Health Organization (WHO).

• All of our Core menu items are free of food dyes and artificial flavours (with the exception of
beverages and third-party products). In addition, we have removed artificial colours from our
Core products (with the exception of caramel colouring).

The Planet- KFC is as committed to the planet as we are to our food and customers. This
includes the development of a long-term plan to implement a more sustainable packaging
strategy in our restaurants across the globe. In addition to KFC’s participation as a supporting
partner with NextGen Consortium, which will help identify fibre packaging solutions that are
recoverable across global infrastructures, KFC has committed to sourcing 100 percent of our
fibre-based packaging from certified/or recycled sources by 2020. KFC has also committed that
all consumer-facing, plastic-based packaging used in our restaurants around the globe will be
recoverable or reusable by 2025.

Animal welfare program

Yum! Brands Inc., parent company of KFC, is committed to the humane treatment of animals

Mission statement

To sell food in a fast, friendly environment that appeals to pride conscious, health minded
consumers

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Key success factors

-Quality

-Service
-Cleanliness

-satisfying the customers’ needs.

BUSINESS MODEL - FRANCHISING

KFC generates its revenue through the different franchisees it has opened up in the different
countries. Each franchise will pay a fee based on a turnover to the master franchisor.

In other words, each franchise is actually an independent business but follows the method of
operation of the franchise. The franchisor will provide the model help and other items as they
deem necessary.

KFC has set certain guardrails for all its franchisees covering the degree of food quality and
store cleanliness they have to maintain so as to run their store under their brand name:

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Below is a pictorial diagram of the KFC business model canvas, explaining different blocks
which form the KFC Business model.

Marketing strategies of KFC

• According to KFC, kids become the future permanents customers and we know very well that
without any marketing strategy no marketing program and no product is successful because
we depend upon customers, customer not depend on us.

• KFC is following Niche Marketing and Societal Marketing techniques.

• It possesses a western culture because some of the Indian people are also following that
culture.

• Moving from Divisional Level to the District level by opening branches • KFC also offer free
home delivery.

• Open their outlets on reachable places.

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• Its menu consists of more than 30 products.

• Gives more priority to Family

KFC Competitive Advantage:

KFC’s chicken has been a strong differentiating factor for the brand and the main reason for its
success. KFC’s secret recipe of its fried chicken having a blend of 11 herbs and spices has been
the driving force for all these years.

Owing to the customers changing needs and to cater to the vegetarian customer segment, KFC
has included vegetarian items as well in its menu. Thus, giving an opportunity to increase its
sales volume and revenue.

KFC competitive advantage has been its ability to adapt to the changing time and needs to
customers. Even though the KFC is 90+ years old, but still it has managed to keep the vibe of a
young brand intact.

ANALYSIS

Marketing Mix Model

Product: KFC, an American fast food restaurant chain specializes in fried chicken. KFC’s
original product is pressure fried chicken pieces, seasoned with Sanders’ recipe of 11 herbs and
spices. KFC adapts its menu internationally to suit regional tastes and there are close to 300
menu items present worldwide, E.g.: In Islamic and Middle Eastern countries the chicken served
by KFC is halal.

In India, in order to cater to vegetarian customers, KFC offers Veg Burgers and Veg Rice bowls.
KFC Chicken Zinger burger is KFC’s best-selling product. In American states, KFC sandwich
is its bestselling product.

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Price: The target audience of KFC is middle and upper middle class and price their products
accordingly. There are different pricing strategies that KFC uses for its products and its variants.

Optional Pricing: Optional pricing is basically used by companies to attempt to increase the
amount customers spend once they start to buy. Optional ‘extras’ increase the overall price of
the product or service. In KFC’s case, customers can buy the main items present in their menu
and can then opt for “extras” or “sides” like drinks or desserts which go well with the main item
that they purchased. The end result is that the customer ends up paying for the main item that
he/she wanted to buy and also for the add-ons.

Bundle Pricing: KFC bundles different products together and offers it to customers at a slightly
lower price. KFC provides different combo offers to its customers and also provide an option
to its customer to make the combo of their own choice.

Place: KFC uses a combination of Franchise outlet system as well as company-

owned outlets. There are a total of 20,000+ outlets in 150+ countries that KFC has outlets in all
the major cities. Customers can visit these outlets and enjoy their products/Items and can also
order online and get their favourite chicken delivered to their doorstep.
Online Channels: KFC provides an option to the customer to order food online through the KFC
website and can also order KFC food from leading food ordering apps/websites that KFC has
partnered with.

Promotion: Promotion plays an important role in the marketing mix of KFC, the company uses
a proper mix of ATL, BTL and Digital channels for creating awareness and promoting their
products. It is the strong product portfolio that makes it different from its competitors. KFC uses
all media like TV, hoardings, print, online ads etc for its promotion. KFC has a strong social
presence will also allow it to interact and engage with its customers and get better insights about
their products and other services.

KFC also uses their outlets to the maximum extent to promote their new offerings. The “finger-
lick in’ good” slogan from 1956, which went on to become one of the best-known slogans of
the 20th century.

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 Porter’s Five Force Model

1. Rivalry among existing competitors:

There are some competitors of KFC such as McDonalds, Subway and burger king. As we know,
every fast-food restaurant’s menu is quite similar. So, the intensity of rivalry is relatively high.
There is a strong competition, companies would compete over price. KFC can take some
controls over the sales through their strength and opportunities like producing more menus like
healthy fast food before the competitors do.

2. Threat of entry from new competitors:

The opportunity of new entrants in this fast-food industry is low, because the start up cost may
be high and also it’s hard to compete over the largest giant fast-food restaurant. Another reason,
why is it so hard for new entrants to start up in fast-food industry may be the brand loyalty.
Fast-food restaurant like KFC, McDonalds, Burger King and other giant fast food restaurant
already has their strong customer base.

3. Bargaining power of suppliers:

The bargaining power of suppliers of KFC is low. As we can see, KFC carbonated drinks is
under Pepsi.co, and they seems to have kind of contract to prevent KFC to have any business
with another carbonated drinks company such as Coca cola. While KFC can’t get any supplier
for the carbonated drinks, Pepsi.co do supplies their product to KFC’s main competitors.

4. Bargaining power of Buyers / Customers:

As KFC is not the only fast food restaurant, the bargaining power of buyers is high. Customers
have lots of choices for fast food, either the customers are looking for the affordable prices or
the tastes of the food. It all depends on the customers. Overall, the competition between these
industries can be categorized as a healthy competition.

5. The Threat of Substitute products and services:

The existence of substitute products can be a strong competitive threat for companies as it
doesn’t allow the company to raise the prices of the product and increase the profitability. All

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of the fast food companies can considered as substitute to each other as they serve the customers
the same way. There are large number substitute product that can replace the KFC, such as
pizza, burger and others.

BCG Matrix

Question Mark
Question marks are those segments, which market share is low and competing in high growth
industry. KFC India comes into the category of Question Mark, India market has huge potential
it is one of the most populated countries in the word. Unfortunately its sales are declining every
year, KFC India should use the product development strategy like McDonald adopted in India.

Stars
Those segment which have high market share in high industry sales growth rate, comes in to
the category of stars. KFC china fall in to the category of stars with high market share in high
industry sales growth rate. For such segments, market development, product development and
market penetration strategies should be formulated and executed. KFC China market
development strategy is very aggressive, is exploring new market segments and establishing 1
restaurant on average every day. In 2015; 743 restaurants were opened in China, and planned
to open 600 more in 2016. It has also used the strategy of product development by offering
traditional food items in menu. KFC china offer 50 food item to their costumer which are twice,
compare to US menu.

Cash Cows
Cash cows are those segments which have high market share in low industry growth rate. KFC
franchising and licensing comes into the grouping of cash cows segment. Franchising and
licensing have generated 16 billion of revenue in 2015. Total system growth rate was 11%,
however, Russia system growth rate was impressive in 2015, it has generated 40 % system
growth rate. Such segment should formulate and execute divestiture strategy, which KFC is
currently executing, in US chains of KFC restaurants.

Dogs

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Segments which have low market share in low industry growth rate. KFC target audience in US
are African American people and its menu contains only 26 food items and emphasis on low
price and takes out. Such segment should use divesture strategy, which KFC US has already
executed and have mostly franchised and licensed KFC US.

Yum! Brands reports 1% decline in sales of KFC.

Segmentation, Targeting, Positioning in the Marketing strategy of KFC

KFC mainly uses geographic market segmentation for its products and offerings. Geographic
segmentation divides markets according to geographic criteria. KFC breaks its business into
different geographical segments like

1. America
2. Europe
3. Asia/Pacific, Middle East, and Africa
4. Other Countries ( like Canada, Latin America)

Basis their geographic segmentation, KFC optimizes its Menu and food offerings to suit the
regional tastes and needs.
Example: KFC offers Veg Rice Bowl in India just to cater to the vegetarian customers in India.
In the USA KFC offers different types of Chicken sandwiches which is not available in other
countries.

KFC target market includes both Non-vegetarian and Vegetarian customer segments. KFC
has items in its menu that cater to adults as well as the young audience. Over the years the
brand wanted itself to be perceived as a family restaurant and has been running campaigns
communicating the same. It used to serve the same menu all around the world which means that
it was using undifferentiated targeting strategy. However, in recent times, following
McDonald’s example, KFC has started localising its menu, giving it better acceptability in the
market.

It has transformed its positioning strategy from product based to value based in recent times.
KFC is strongly positioned in the minds of consumers for its Chicken menu. There are very few

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outlets which serve anything in vegetarian. But when it comes to non-vegetarian, KFC is just
superb. Its chicken wings and chicken bucket is a favourite with everyone. This excellent
targeting technique is the reason that most non vegetarian lovers flock at KFC.

Brand Equity of KFC

Brand Awareness
KFC is the famous, multinational, fast food chain in almost every country. Every individual is
aware about the existence of KFC. It is an acronym of Kentucky Fried Chicken, popular for
meals that can be cooked at homes but still it is famous for its chicken pieces. It is able to attract
many customers through accurate usage of media channels. In Pakistan, people call every
chicken piece as KFC. KFC is able to create its awareness because of it franchising strategy,
and this helps it in geographically expansion.

Brand Association
KFC has been associated with many famous celebrities, for brand endorsement. It sponsors
many events and entertainment events, like movies and PSL, for loudly communicating with
audience. It also offers new, unique and very attractive meal deals, which are very affordable
for people. Their prices are worth for every bite, as no other fast food chains are able to offer
such tasty fried chicken. It conglomeration with PepsiCo in United Kingdom has able to gain
the large target audience of the country.

Brand Asset
KFC is offering a great number of products, and continuously adding more meals in the menu.
It is famous for fried chicken pieces, but also offering twister, burger of different types, hot
shots, rice, and now it added peperoni burger, slushes, and traditional burgers according to the
country they are running like in Pakistan it offered chapli kabab. Moreover, it has over 18000
franchises in almost 115 countries. Its biggest asset is its secret recipe of sauces and fried
chicken, which is kept secret from past many years.

Brand Loyalty

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KFC is able to gain strong brand loyalty across the world, as it target every segment, from
children to adults, youth to whole family and group of friends. Because of its maintenance in
quality, taste and new meals in menu, and affordable prices, it is able to gain much attention of
the people. However, it is competing with McDonalds, but still loyal customers do not switch
to other fast food. It intelligently approaches the marketing strategies to position itself in the
mind of consumers for the long run.

Brand Element
KFC is famous in every workplace, homes and food events in almost every country. Its tagline
“finger lickin good” is very famous and they really proven it with their taste. This tagline
presents the emotional state and associate the KFC with building stronger relationship with
consumers. Its logo with Colonel Sanders is memorized by every individual, which is a plus
point for KFC. It tries to improve its packaging for delivery and take away so that consumers
would be able to have the same fresh hot chicken taste.

STATUS

• Appreciate the need for protecting animal right in developed and developing
countries like India:

KFC's claim that they “only deal with suppliers who promise to maintain our high
standards and commitment to animal welfare”. But about the treatment of the chickens
it buys, a proof of graphic evidence, a video was taken by an investigator of People for
the Ethical Treatment of Animals (PETA) had showing that the chickens was purposely
abused by the workers. The video was taking in a slaughterhouse, at a Pilgrim's Pride
plant in Moorefield West Virginia, where the workers kicking live chickens like playing
footballs, thumping them into walls, apparently those workers do it just for fun. This
does not happens once, the investigation of PETA on KFC shows that there are so many

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 suppliers of KFC had committed into this behaviour. Only in United States many
suppliers have involved in, one of them is Tyson slaughterhouse. In the slaughterhouse
showed that birds purposely were burnt to death, were blown apart by makeshift
firecrackers, and broke their legs by the workers so that it can be fit into slaughter-line
shackles. Tyson is KFC's number one supplier.

The most popular issue on the abuse by the supplier of KFC is happens on India.
Chickens was found overstuffed into awfully crowded warehouse plagued with chicken
carcasses, cruel breeding practices, sick and injured chickens but never received any
medical attention, and they suffering at the hands of cruel workers who neglected to
examine even minimal ethics of animal welfare. Animal abusing can be defined as the
most serious Ethical Dilemmas on KFC.

• Importance of factors such as Health- ‘Fried’ Fast Food:

Fried is like almost everything in KFC, the main course from the menu in KFC is
actually fried chickens. Unlike any other fast food brand, common one-McDonalds',
which in their menu French fries is just a side dish. In the past few years, KFC has been
sued by the Centre for Science in the Public Interest (CPSI), charged with the food
contains “staggering sum” of trans-fat. In one three-piece chicken combo meal contains
15 grams of trans-fat, which is over the limit that a person should have in one week.
These trans-fat are actually harming consumer's health, KFC as the world's most popular
chicken fast food chain, over 14,000 outlets around the world, with more than

12 million customers eating their “fried” chickens every day.

In contain of the recipe there are proved that in contents of KFC chicken flour they use
monosodium glutamate (MSG). Monosodium glutamate is one of addition that
impresses the food. Monosodium glutamates describe that, a flavour enhancer is used
in savoury foods, especially Asian foods.

The symptoms which MSG is suspected of causing following which include headaches,
dry mouth, flushing, tightening of facial muscles, numbness, chest pain, heart
palpitations, nausea and general weakness.

Their unethical behaviour has influenced widely against their customers. It is a serious
ethical dilemma which can be found in KFC.

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 CASE SOLUTION

• Adopt the “Animal Care Standards” program. This would lower the amount of ammonia
in the air in factory farms, improve the living spaces and lighting in chicken sheds,
prohibit the intentional starving of breeding birds, and ensure that birds are provided
with mental and physical stimulation.

• Switch to controlled-atmosphere killing (CAK). This would prevent live birds in

slaughterhouses from being abused by workers, having their throats slit, or being scalded
while they are still conscious. CAK would also improve conditions for workers and
decrease contamination levels in chickens’ flesh.

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 • Switch to mechanized chicken gathering. This would drastically reduce the number of
broken bones and painful bruising that birds endure when factory-farm workers
carelessly throw them into transport crates

• Breed for health rather than rapid growth, and stop feeding drugs to chickens. This
would reduce the rate at which birds suffer painful, crippling diseases and injuries, such
as broken legs, heart attacks, and lung failures

• Make all welfare standards transparent and verifiable. This would simply ensure that the
animal welfare program is being adhered to through announced and unannounced
independent audits

• One of the spokesperson stated “we take health and safety issues very seriously”. Thus
they must provide a variety of menu choices and provide nutrition information,
including trans-fat values, on our website and in restaurants so that consumers can make
informed choices before they purchase products

• The company must review alternative oil options, considering that there are a number
of factors to consider including maintaining their unique taste and flavour of Colonel
Sanders' Original Recipe, supply availability and transportation.

ANNEXURE
(1)
Companies in this industry operate restaurants in which customers order and pay at a counter.
Fast food firms must comply with country-specific political requirements, such as national
minimum wage regulations, affecting costs. Demand is driven by consumer tastes and personal
income. The profitability of individual companies depends on efficient operations and effective
marketing. Large companies have advantages in purchasing, finance, and marketing whereas
small companies can compete effectively by offering superior food or service. The statistic
shows the brand value of the 10 most valuable fast food brands worldwide in 2018.

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 (Source: Kantar Millward Brown- Statista 2018)

(2)
This statistic shows the average sales per unit of KFC in the United States from 2006 to
2017. In 2017, KFC's average sales per unit reached 1,200 thousand U.S. dollars.

(Sources: Yum! Brands; QSR magazine- Statista 2019)

(3)

For the fifth straight quarter, fast-food major Yum! Brands, which operates Pizza
Hut, KFC and Taco Bell in India, saw strong sales growth, pointing to a recovery
in food services.

For the July-September period, KFC reported a system sales growth of 8 per cent.
System sales growth is industry parlance for overall top line growth.

Yum! did not disclose same-store sales growth (SSG), which is basically sales growth for
stores one year and above. However, Yum! did give a sense of SSG for the September
quarter, saying emerging markets (which includes India) saw SSG of 5 per cent for KFC.

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 REFERENCES

• Vivek Gupta; K.Yamini, 2004, KFC in India- Ethics and Social Responsibility, IBS
Centre for Management Research, Reference no. 704-070-1, 18 pages.

• Monika J.A. Schröder, Morven G. McEachern, 2005, Fast foods and ethical consumer
value: a focus on KFC, British Food Journal, Volume: 107, Issue:4, pages 13.

• Donald G. Mcneil Jr., July 20, 2004, animal supplier accused of animal cruelty, The
New York Times.

• https://www.ecomall.com/greenshopping/peta.htm
• http://multinationalmonitor.org/hyper/mm0196.03.html
• http://www.ethicalcorp.com/content/kfc-and-peta
• W.L. Boatright, M.S. Jahan, B.M. Walters, A.F. Miller, D. Cui, E.J. Hustedt andQ.

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Lei, 2008, Journal of Food Science, Volume 73, Issue 3, pages C222–C226

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