International Management

Target Country Model Analysis

Pest Analysis

This model will include political, Economical, Social and Technological factors of Switzerland affecting the products of KFC.

Political factors:The government of the country is organized in three levels i.e. federal, cantonal and communal. The federal level is the one which is controlling all the areas related to foreign relations and investments. The taxation is comparatively high as compare to US. The price of raw material is also high (Bhadra, 2017). But they can afford it. So there is a chance that KFC twister will survive all the political factors and establish itself in the highly competitive market.

Economical factors:The country is having quite stable economy as compare to other countries. The growth rate is 1.7% of the total world's economy. The value of Swiss franc is almost equal to USD. Due to high tax factors, the product cost is also high.

Social factors:The people are highly educated, as it can be seen from the 99% literacy rate. KFC majorly rely on fried chicken, but in Europe people will not find it that much attractive. The tradition of the country was never to eat fried food. This makes it even more difficult for KFC Twister to survive in the market (Albuquerque and et.al., 2016.). But now people are shifting from traditional food to fast food, so if the quality of product is good and according to the likes of people, then it can achieve success in those conditions.

Technological factors:The company is making lots of efforts in their technological aspects. In Switzerland, out of 100 people, 97 are actively using internet. This is a huge advantage of KFC, because they can use their online app and websites to attract more number of consumers. They are utilizing R&D to improve the quality of their products. All these technological factors will help the company to establish themselves in the country and also earn profit from their main product.

SWOT ANALYSIS

Target Market Appraisal

Market size and Growth

KFC was established in 1939, and they are still making their legendary fried chicken. There are various additions in the menu, which includes oven-roasted types of chicken like chicken sandwiches, potato wedges and wraps, popcorn chicken etc. (Ozturk, Joiner and Cavusgil, 2015). For adults and kids they are having little bucket of pudding deserts. The company is having their main objective to increase the sales rate by 15% over the course of next 5 years. This is to increase the profitability. The second thing is to hire well skilled and well trained employee in the sales department. This will help them increasing their sales rate. In Switzerland, as the fast food is emerging in market, the market size is also expanding. The growth rate will be high because the product quality is good. This product is also new to the market, so it can have major impact on the consumers by its quality (Blevins, Khwaja and Yang, 2014). The company will certainly have growth in their market shares because they are earning high profit in most of their products. The economy is consistent in the country, so this will require low investment of capital. This will further improve their revenues.

Competitors Profile

The main competitor of KFC is McDonald's. This firm is also an fast food restaurant chain. The products are offered by both the companies are quite similar in terms of burger. But the cost of KFC products are very less as compare to other competitors. The chicken is far better and the service is also fast (Thornton and et.al., 2016.). Currently McDonald's is having higher amount of shares in the market, because this firm is already established in the market. But this will affect the performance of KFC products, because they are having high quality and on lower prices. These products are more healthy as compare to competitor's product.

External Trends

The performance of fast food industry was very strong in 2016. The revenues generated form the fast food sales is increased. But the life style of Switzerland is becoming more hectic because of the longer working hours (Schrempf, 2014). Mostly people are living in single households, so they are not getting the time to cook food. Therefore, it gives a great advantage to KFC to open their outlets in such areas where single households are more. This will increase their sales as well as their profit.

Buying Behaviour

The buying behavior of consumer is affected by their age, life cycle, financial conditions and occupation. In the country which as economically rich as Switzerland, the buying behavior only gets influenced by quality of the products (Brunner, 2014). KFC is serving all kind of food and their menu is having lots of varieties to chose from. The social culture which is shifting to fast food also influence the buying behavior of consumer.

Market Entry Method Recommendation

There are various ways to enter in the market internationally like Direct export, franchising, Contracting etc. (Cain, Moore and Haran, 2015). The method used by KFC to enter in the market of Switzerland is Franchising. In this method, the company will develop a package of all their successful products which gained success in their domestic market (Miller and Yang, 2016). The franchise will be given to those people who are having right bid for that part of the country. They have to give certain amount of profit to the company quarterly or annually. Thus, by using this method, KFC can gain the majority of market shares. With the help of this marketing strategy organization can develop their market share in the Switzerland.

KFC is international brand they want to open more than 11 restaurants in the Switzerland for which they need to make investment. Through Franchising, they can make entry in the targeted area along with this, it also helps to them for save their cost. So it can be recommended that it is the best strategy for enter in new market.

Marketing Strategy

Marketing objectives

It refers to the objectives which a business must have to meet in order to achieve its business objectives (Albuquerque and et.al., 2016). Following are the SMART objectives of the KFC in Switzerland.

Segmentation

For expanding business in other country it is important to make people aware about products and organization services for this it is important to use a marketing strategy which helps to them for expanding business (RBlevins, Khwaja and Yang, 2014). In order to expand business in Switzerland following are the marketing strategy of KFC.

Segmentation,Targeting&Positioning

It is refers to the divide market into small variables such as on the basis of demographic segmentation, geographic segmentation and psychological segmentation (Henley, Raffin, and Caemmerer, 2013). For the targeting market in the Switzerland, KFC choose demographic segmentation and geographic segmentation (Brunner, 2014). Under this company is open their business at the highest visited tourists places and on the demographic basis the company make target to high-income group people who belongs to 16-35 age group.

The targeting customers of the company are young people who belongs to age group of 16-35 and tourist people. KFC is produce fast food products to their customers and young people like to eat such kind of food (Cain, Moore and Haran, 2015). For KFC ,to earn maximum profits they need to young people and offers products at the low income group. Through this strategy they can make earn more profit.

Positioning refers to for give clear and desirable place for the products in the minds of consumers. For the position of the product the company is going to make solid promotion in the Switzerland. This country is tourist attraction so for making promotion they can make use of the Social media (Engelhardt, 2015). Most of the people in the world use social media because they have the highest number of users.

Marketing Mix Recommendations

Marketing mix, is business tool used by organization for marketing its product or services (Element of marketing process. 2015). It is the essential tools which helps to KFC for achieving their marketing objectives. Following are the recommended marketing mix of the KFC.

Products

There are many types of products which are produce by the KFC in its business operation such as Chicken, Burger and snacks (Miller and Yang, 2016). For expanding business in the Switzerland the company is offering KFC twister. The product consists extra crispy white meat chicken. Concepts of product is vet different from the all types of other fast food items. So KFC can easily make more profit.

Price

Price is the amount which pay by customers for purchasing product. For expanding business in the Switzerland the company is using skimming strategy. The company is always offers high priced products (Napier and Vuong, 2013). In the price skimming strategy, organization charged high prices at the initial stage and reduces prices as according to the time. With the help of this price strategy company can make unique market position of their product.

Distribution/place

It refers to the place from where the company target to their customers. In the Switzerland the company is planning to open new 11 outlets in the Switzerland. This place is basically tourist place so they company can target to their customers effectively (Ozturk, Joiner, and Cavusgil, 2015). Along with this the company is also offers it product through online websites and take online orders form their customers.

Promotion

There are different types of promotion strategics which are available for the KFC. Promotion can be done through advertisement, Sales promotion, public relation and events and experience (Schrempf, 2014). The best promotion method which used by company social media and advertisement. Through this strategy KFC can gather more customers. Along with this, firm can also use of coupons, discounts and bundles packages on the special event.

KFC is one of the most successful fast foo chain in the world. The company is offering different types of product and services. In the above recommended marketing mix, the company is making standardization process (Kotler and Armstrong, 2010). In the promotion strategy the company can offers low – cost unconventional meas can be used. This strategy helps to gather more customers in the Switzerland.

Budget Analysis

In order to accomplish the plan KFC need to make budget. This budget includes make analysis of the cost, sales forecast, expenses. With the help of this budget estimation the company can utilization of their resources and make implementation of their plan. In the marketing strategy KFC includes marketing team, promotional team, additional expenses. The allocated budget of the company is $10 million out of which $2 for marketing team, $5 for promotion and $3 are included in the additional expenses.

Control

Controlling is measuring and correcting organizational performances, KFC activities are measuring by goals and plans which they set in the process of budget. For controlling budget the company is includes different process. All the activities of the marketing are control by the manager of the KFC. After, measuring the performances with the standard performance the company can take further corrective actions.

Conclusion

Summing up the above report it can be concluded that marketing helps to organization for expanding their business. These strategics support company to achieve their overall marketing objectives. KFC is USA based organization fast food chain. The organization is expanding their business in the Switzerland with their innovative products KFC twister. With the help of this product they can easily target market and customers. For expanding business company using social media through which they can target their customers.

References

Books and Journals

• Albuquerque, T.G., and et.al., 2016. Cholesterol determination in foods: Comparison between high performance and ultra-high performance liquid chromatography. Food chemistry. 193. pp.18-25.
• Bhadra, R., 2017. Reducing Post-Harvest Loss in Developing Countries through the Feed the Future Initiative. Resource Magazine. 24(3). pp.12-15.
• Blevins, J.R., Khwaja, A. and Yang, N., 2014. Market Share Evolution, Heterogeneous Size Spillovers and Organizational Forgetting in Retail Chain Dynamics.
• Brunner, T.A., 2014. Applying neutralization theory to fair trade buying behaviour. International Journal of Consumer Studies. 38(2). pp.200-206.
• Cain, D.M., Moore, D.A. and Haran, U., 2015. Making sense of overconfidence in market entry. Strategic Management Journal. 36(1),.pp.1-18.
• Czinkota, R. M. and Ronkainen, A. I., 2010. Principles of International Marketing.South-Western Cengage Learning.
• Engelhardt, E.S., 2015. Appalachian chicken and waffles: countering southern food fetishism. Southern Cultures. 21(1). pp.73-83.
• Kotler, P. and Armstrong, G., 2010. Principles of marketing. Pearson Education.
• Miller, D.J. and Yang, H.S., 2016. The dynamics of diversification: Market entry and exit by public and private firms. Strategic Management Journal. 37(11). pp.2323-2345.

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