Shanghai-headquartered Yum China Holdings celebrated the opening of KFC China’s 10,000th restaurant on December 15, marking a significant milestone in the company’s 36-year growth journey in the country. It is situated on the banks of the Beijing-Hangzhou Grand Canal in Hangzhou, a historically important link connecting northern and southern China.
Since launching its first outlet in Beijing in 1987, KFC has grown into the country’s largest quick service restaurant brand in terms of system sales. The expansion has been underpinned by a highly efficient in-house supply chain management system developed over three decades.
“As the first western QSR restaurant brand in China to reach this incredible milestone, the10,000th store opening is a proud moment for all of us, demonstrating the brand’s deep bond with Chinese consumers across generations for over 36 years,” said Yum China CEO Joey Wat. “Presently serving just one-third of China’s population, our goal is for KFC China to reach over half by 2026.”
“In pursuit of our ambitious growth targets, we are committed to establishing KFC China as the preferred daily choice for an increasingly diverse customer base,” said Warton Wang, general manager. “We remain at the forefront of pioneering new formats and groundbreaking concepts to accelerate store expansion into untapped cities, while also staying ahead of evolving consumer preferences and emerging consumption trends. Going forward, KFC China will continue to offer a diverse array of innovative meal choices across price ranges.”
Strategic Footprint Expansion for Greater Reach
Despite having already established an extensive presence in over 1,900 cities as of the end of Q3 2023, the chain continues to actively expand its market, with 1,100 untapped cities on the radar for entry. Over the past five years average annual growth in net new KFC units has exceeded 22%, all while maintaining an average store payback period of approximately two years. At the same time, KFC China has been accelerating store openings in lower-tier cities while increasing store density in higher-tier cities.
Innovative Offerings to Satisfy New Demand
Through the rollout of innovative products and development of new categories, KFC is proactively broadening its consumer base and catering to the evolving needs of Chinese consumers. Recent successes include the introduction of Juicy Whole Chicken and Beef Burgers, with both products generating annual sales exceeding $100 million. The chain is also widening its menu to introduce more entry-level price point offerings.
Looking ahead, KFC China plans to further accelerate its annual net new store openings to exceed 1,200 in the next three years, with 15% to 20% expected to be franchise operations, aligning with Yum China’s overarching goal to reach 20,000 outlets by 2026.
About Yum China Holdings
Yum China is the largest restaurant company in China, with over 14,000 units and 400,000 employees working under six banners across 1,900 cities. KFC and Pizza Hut are the leading brands in the quick-service and casual dining restaurant spaces in the PRC, respectively. Taco Bell offers innovative Mexican-inspired food.
Yum China has also partnered with Lavazza to develop the Lavazza coffee concept in China. Little Sheep and Huang Ji Huang specialize in Chinese cuisine.
