KFC’s Supply Chain
KFC is well-known in Bangladesh and throughout the world for its quick and efficient services,
high-quality goods, great customer service, and solid financial condition. KFC is a firm that sells
fast-moving consumer items and works in the food production industry. KFC must maintain a
rapid, flexible, and responsible supply chain in order to provide high-quality customer service.
Restaurants report to the branch distribution center as part of the KFC supply chain. It is the
branch distribution center's responsibility to examine the region's competitive demand. The
distribution center now orders the supplier after calculating the total demand. KFC's supply chain
adheres to the Distribution requirements planning (DRP) framework. There are three output
plans and two input files in this DRP system. Material requirement planning, procurement
planning, distribution planning, inventory file, and supply resource file are all used in
distribution requirement planning. The store manager orders all of the raw supplies needed from
the distribution center. Dry items, frozen goods, and wet goods with a very limited shelf life,
such as vegetables, breads, and so on, are included. Dry and frozen commodities are often
ordered quickly, whereas wet goods are ordered 2-4 times a week, depending on demand.
Demand estimation judgments are made based on:
The Purchase Cycle, safety stock, and lead time.
Historical data and predictions
Seasonal variations
All of these data are typically utilized to estimate demand, which is typically done by the store
and distribution center. The inventory file is meticulously and routinely updated by the team in
order to maintain an effective supply chain. The supply resource file is used to monitor the
supply side of the supply chain by displaying the arrival time on the supply side. This
information represents the supplier's timeliness, order processing time, and distribution center
competency. The purchase plan is determined after examining the distribution center's available
inventory, the accuracy of the demand presented in terms of variations, and so on. Following
confirmation and verification of the orders' correctness, they are transmitted to the vendors. The
raw supplies are distributed when the order amounts have been thoroughly verified. It is
accomplished by properly taking into consideration the capacity sanction, method and route of
transportation, fuel rate, and so on. It is assured that optimum efficiency and lowest cost are
attained.
Demand
Planning
Distribution
Inventory File
Plan
Procurement Supply
Plan Resource File
Fig: KFC Requirement
Planning
Supply Chain Map of KFC
The structure of KFC's supply chain is common to the restaurant industry, as seen in the diagram
below. The majority of raw materials are sourced from both the market and company-owned
facilities. Chicken is purchased from both the market and privately operated chicken farms.
Similar considerations apply to sauces, sachets, etc. Transport is often performed by contracted
transporters. The branch distribution center is largely responsible for coordinating the whole
supply chain.
Chicken
Preparation
Warehouse
and
Cold Storage
Packaging
Sauces
KFC Outlet
Buns
Warehouse
normal
storage
Other Materials
Supplier Management System of KFC
The central office typically decides which KFC items must be purchased from suppliers based on
the ingredients needed for production and their availability in local marketplaces. Typically,
obtaining the necessary goods from both official suppliers and neighborhood stores requires a
balance. KFC uses the "Star System" to choose suppliers and place orders with them to manage
its suppliers. The Start system evaluates suppliers according to the five qualities which are
communication, reliability, financial, technical and quality ensured. The quantity to be ordered
from the supplier for the upcoming period is determined based on the score received from the
suppliers. Several KFC departments, including the technical, procurement, and so forth, do these
evaluations. Every three to six months, this examination is conducted. KFC maintains a very
tight process for quality. If any vendors fall short of the requirements, they are not used. KFC
buys its ingredients from reputable vendors including UBF, Nestle, and other top vendors in the
nation. Besides, if any supplier fails to meet the expectation in a quarter, KFC makes sure to take
all actions necessary.
Customer Relationship Management in KFC
KFC has consistently worked to enhance customer relationship management in its restaurants.
They have also made significant investments in their restaurants all around the country to
enhance the ambiance and patron experience. The goal is to make KFC a destination for friends
to hang out, families to dine, and individuals to have brief meetings all in one location. To ensure
that the customer service at that location is also top notch, the delivery system has also been
improved.
KFC just released a smartphone app in Bangladesh that allows users to place orders and contact
with KFC. By taking charge of this, they can always maintain a perfect customer relationship.
These retail locations all strive to offer busy people quick but delicious cuisine. KFC also puts a
lot of effort and resources into giving its clients a great experience. However, the business needs
productive and skilled staff if it wants to deliver commendable customer service. KFC has a
rigorous hiring procedure for all employees where they assess potential hires based on these
criteria in order to assure the availability of such staff. Additionally, every new hire goes through
a training program to educate them everything they need to know to create a positive client
experience.
