REPORT
REPORT
REPORT
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1.0 EXECUTIVE SUMMARY
KFC, which also known as Kentucky Fried Chicken is an American fast food
restaurant chain headquaters in Louisville. KFC had started its foot in Malaysia since 1973.
Since then, there are many branch of KFC has been establshied throughout Malaysia. In this
particularly, we investigated into one of the KFC branch which is KFC Saujana Utama.
In this report, issue and problems are being identified at KFC Saujana Utama. There
are a few problem that arised from this branch of KFC, which are, bad service provided to
customer, no delivery channel provide to all location although the distance is very near to the
restaurants, staffs do not have enough skills to handle the customers, and lastly, the bad
quality of products.
We also contruct a business model canvas on how KFC can still manage to be one
of the largest fast-food company in Malaysia despite having some problems and issues that
they need to solve. We construct the BMC through 9 categories, which are, key partners,
key activities, value propositions, customer relationships, customer segments, key
resources, channels of distributions, cost-structure, and also their revenue streams.
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2.0 INTRODUCTION
KFC is based in Louisville, Kentucky, and is the world‟s most popular chicken
restaurant chain. Founded by Colonel Harland Sanders in the early 1930s by cooking and
serving food for hungry travellers. In 1952, Sanders started franchising his chicken business
and named is as Kentucky Fried Chicken. KFC is part of Yum! Brands include the world‟s
largest restaurant company in terms of system restaurants, with more than 36,000 locations
around the world. The product is made on the motto of “Crispy outside, juicy inside”. By the
early „70s, that special recipe of KFC reached Malaysia. The first KFC restaurant opened in
Malaysia is on 1973, Jalan Tunku Abdul Rahman. Until now KFC Malaysia reached about
600 branches around Malaysia and still counting (KFC Menu).
One of the branches is KFC restaurant at Saujana Utama, Selangor. For this project,
we will make a case study about the KFC restaurant at Saujana Utama, Selangor. KFC
restaurant at Saujana Utama is one of the most favourite food among Malaysian. The unique
taste of the KFC brand is nothing to be compared to any other fried chicken sold on the
market. Many people whom chicken lover will prefer KFC rather than chicken MCD due to
the taste of chicken MCD cannot beat the chicken KFC tastiness. However, every company
have its own problem issue. As for KFC Saujana Utama restaurant, there were some
problematic issues that frequently happen, as stated below.
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2.2 PROBLEM STATEMENT
The first problem issue that frequently happens in KFC Saujana Utama, is regarding
the bad service provided to customers. For example, the customer waited too long for their
KFC order. This will make the customer frustrated especially when they were hungry. In
other words, the customer will get angry due to long waiting to receive their order and could
lead to the customer having conflict with staff or make complain in term of the service.
Besides that, some staff also does not show good respect for their customer. How this
happens is when the staff does not have self-control when he or she gets angry thus making
them be rude to their customer. This has been assumed that it leads to a fight or quarrel with
a customer as we frequently saw it on social media that been viral. People around us will
see this in public when things like this happen, then it will eventually give a bad image to the
KFC Saujana Utama.
The second problem issue is when in using the website and apps of KFC Malaysia.
KFC Malaysia has only one main channel website and apps, in which all KFC restaurant in
Malaysia will have only one Website and apps to be used by the whole country regardless of
the different KFC restaurant location. However, for KFC restaurant at Saujana Utama does
not provide the delivery service for UiTM Puncak Alam student, even though the distance
between KFC restaurant at Saujana Utama and UiTM Puncak Alam is not that far. Thus,
making the website and apps of KFC Malaysia is not that reliable and effective. Moreover,
the ratings and reviews of the KFC Malaysia mobile app also very low which is only 3.7 (KFC
Malaysia). As we look upon the rating and reviews of the app on the play store there were
many complaints from the customer. For example, the app crash or hang when using it, long
time to log in which is not very efficient, very bad in detecting the location and so on. Apart
from that, there is not much information regarding about KFC restaurant at Saujana Utama
through online. There is only Facebook page, but there is no promotion or updated
information was held on the Facebook page. Thus, this causes the KFC at Saujana Utama
to have less engagement with their customer.
Next, is many of the staff especially new worker also does not have enough skills,
knowledge or training as a worker of KFC restaurant at Saujana Utama. This will affect the
service quality they provided toward their customer. When the staff does not enough skill,
knowledge or training, the staff cannot work in a professional way. Thus, will lead them
making many mistakes while working. For example, as a cashier, the person must know how
to use a cash register to ring people up, take their money and give them their change and
receipt. They might also have to wrap or bag their purchase (Harness, 2018). At the end of a
shift, they will have to count the money in the cash register and compare with the sales data
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on the computer. So, if the amount of cash register does not have the same amount with the
sales data in the computer, the cashier itself need to be responsible for it. Either it had a
lower amount than the expected sales the cashier will need to pay back for what is lost. This
always happens in most KFC restaurant, as some cashier lost so much money than the
expected sales because she or he does not have enough skill and inexperienced worker.
Thus, will affect the company financially. As a cashier also, they need to have skills such as
basic Math, interpersonal communication and verbal communication, customer service,
product knowledge, efficiency, friendliness, basic computer knowledge and so on.
Finally, is the issue regarding the quality of the product. It is true that every KFC
restaurant will use a high brand of chicken, but there was a complaint from the customer the
KFC they ordered is not clean and fresh. This happens because they do not prioritize
hygiene when preparing food to the customer. Other than that, is the issue that happens
regarding the size of the chicken they serve to the customer in KFC Saujana Utama
restaurant. It has been assumed that there was a complaint where the size of KFC chicken
was getting smaller than usual as it does not satisfy the customer. Besides, the cost for KFC
food is not that cheap, making the customer felt that it is not fair to buy at such price for a
small quantity or size of food and does not make them full when the customer is in hunger
for KFC. Therefore, this will affect the customer satisfaction about the KFC Saujana Utama
and will lead to the customer making complaints or loss of customer.
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3.0 COMPANY INFORMATION
One of the interesting facts about Malaysian KFC is, it was the earliest fast-food
eateries in Malaysia to employ people with different abilities from its outlet in Jalan Imbi,
Kuala Lumpur on November 15, 1986. In Kuala Lumpur, the first fully operated Malaysian
KFC was the first KFC in the world that run by speech-and hearing-impaired staff. Then, the
operation has expanded to its Malaysian operation in Tanjung Aru (Kota Kinabalu) and
Saujana (Kuching) outlets in 1996. Currently, Malaysian KFC has employed more than 350
Malaysian individuals predominantly of speech and hearing impairment. KFC Malaysia is
expected to have a 5% growth in sales in 2019. It has opened 23 outlets in 2018, a further
36 outlets in 2019 and 30 eateries later in 2020. KFC in Saujana Utama was opened in the
year 2010 and currently, they have sixteen employees of full-time and part-time.
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3.3 PRODUCTS AND SERVICES
Affiliated to most Asian markets, the KFC similarly offered rice in its menu.
Embracing the local culinary tradition, KFC rice draws its inspiration from the local
Hainanese chicken rice. Additionally, the KFC chicken nuggets also traced its origin from
Malaysia before being expanded to many international outlets. One of the common menu
offered by KFC is two pieces of "Hot & Spicy" Chicken combo which blends of 11 herbs and
spices, Sander‟s recipe that served with rice, coleslaw and Thai chilli sauce along with KFC
Chicken nuggets with sour cream sauce as shown on the picture above.
Akin to other international KFC markets, the KFC at Saujana Utama also featuring
various localised and seasonal food items in addition to the universal KFC Menu. KFC
customarily offers two types of fried chicken such as Original and Hot & Spicy. In addition,
other types of fried chickens and food products that are significant to Malaysian‟s cultural
and religious festival are also being introduced to the local consumers periodically.
Among other common year-long regional items unique to the Malaysian market
includes chicken rice, rice congee, wrap, cheesy potato wedges, gula Melaka vanilla
pudding, white coffee and teh tarik. Malaysians mostly prefer dark meat cuts, a divergent
from the American KFC that observed white meat in higher demand. Furthermore, being a
predominantly Muslim-country, all meats are slaughtered in accord to the Halal-method
under the supervision of Shariah Advisory Council and the Department of Islamic
Development Malaysia.
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3.4 BUSINESS, MARKETING AND OPERATIONAL STRATEGY
The KFC Saujana Utama business design in Malaysian is generally offering a mid-
range dining option to cater to the predominantly middle-class Malaysian population. The
premise is able to accommodate the dining culture commonly practised among the
Malaysian society. KFC Saujana Utama offers various localised and seasonal food items in
addition to the universal KFC Menu. The various type of fried chickens and food products
offered are significant to Malaysian‟s cultural and religious festival. These menus are being
introduced to the local consumers periodically according to the period of the Malaysian
festival. KFC is known for its slogans "It's Finger-Lickin‟ Good!", "Nobody does chicken like
KFC" and "So good" that enable the customers to share the fun with family and friends.
Along with the industry trends, now KFC also operates round the clock, offering drive-
through and delivery service. However, KFC at Saujana Utama did not operate 24 hours and
did not offer to drive through since Saujana Utama is not a big city.
In 2016, the brand has been nominated as the largest fast-food chain in Malaysia
and dominating 45% of the local Fast-Food Market shares with its traditional rival,
McDonald's following in second, while its sister restaurant, Pizza Hut spotting at the third
place. By 2018, the restaurant has established a strong presence in the country, estimated
to serve almost an equal proportion with the total population of Malaysia with 25 million
customers every month by its 14,000 employees. As for KFC at Saujana Utama, the
recorded sales are not as much as the other KFC located in the big city. This because it also
has competitors such as Mamak Restaurant and Mykori. However, they still manage to
increase their sales, especially whenever UiTM students return back to university after the
semester break.
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4.0 COMPANY ANALYSIS
CUSTOMER
CUSTOMER SEGMENTS KEY RESOURCES
RELATIONSHIPS
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KFC key partners are Pepsi, Coca-Cola, Nestle, their raw materials suppliers,
Suruhanjaya Syarikat Malaysia (SSM), Kementerian Kesihatan Malaysia (KKM), and also
Jabatan Kemajuan Islam Malaysia (JAKIM). They partners with Pepsi, Coca-Cola, and
Nestle for their supplies of beverages as their main beverages are from all the three
companies‟ drinks. They also partner with SSM in registering their businesses so that it legal
for them to make business in Malaysia. Besides, they also partner with KKM in making sure
that not only all their products but also the staffs follow the regulations set by KKM in having
a business in the food industry. In the meantime, they also partner with JAKIM in order to
make sure that all their products are halal to be selling to Muslims in Malaysia as the
majority of people in Malaysia are Muslims.
Their key activities are serving, selling, promoting, logistics management, and also
catering management. KFC serves and sells its own products therefore it is their main key
activities. They also make promotion according to seasons for example during the holiday,
Chinese New Year, also during school breaks. They also catering management as they also
provide catering service for events and parties.
In addition, KFC value propositions that make the different form others are because
of their homemade chicken, secret recipe, fast-food chain company, and their product has
quality assurance. According to their history since the beginning of KFC, they make their
own homemade chicken with their own secret recipe to make their products different from
others. KFC also distinguish themselves as one of the biggest fast-food chain company in
the world for selling fried chicken. Moreover, they also extricate themselves from others by
providing good quality assurance for their products to customers.
Besides, KFC segments their customers by targeting first of all the fast food lovers,
then KFC target for fried chicken lovers. Next, they segment their customers for the mass
market, franchisers, and also children. at first, they started targeting all the fast food lovers
as their customers. This is because, since their products are also fast food, therefore, their
main customers come from fast food lovers. Next, they specifically target fried chicken lovers
as their main customers. This is because although their product is fast food, they need to
differentiate themselves with other fast-food companies. Then, after they established their
target customers with fried chicken lovers, they then started to spread their wings with mass-
market, franchisers, and also children as their customer segments.
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Furthermore, KFC also builds relationships with its customers. They build a
relationship with their customers through social media, such as Twitter, Facebook, and
Instagram, and also through mass media. KFC build their relationship with customers
through social media because they can attract customers easily with their promotions with
the current technology evolutions. Through social media, they get feedback from customers
and also benefits from mouth-to-mouth advertisements marketing from customers when
there are promotions they make because their customers will tag them.
Their main key resources come from their suppliers, staffs, machinery, and point of
sale, brand image, secret recipes, storage, and competitive price. The main resources for
their business are suppliers, staffs, and machinery. This is because without the suppliers,
they basically cannot function because their suppliers are the one that supplies for their
product in making the fried chickens. Staffs and machinery are also their key resources
because they not only depends on the person to handle the production process but also
depend on the machinery to make the operation process more efficient.
Customers can purchase their products traditionally by direct walk-in through the
restaurants. However, nowadays, with the evolution of technology, customers can purchase
the products through their apps, websites, and also delivery. The main cost of expense they
mostly structure for is mainly for supply storages, catering van, utilities for every month, and
also for branding their product. Last but not least, KFC‟s profit and revenue majorly are
streams from food and beverages sales. However, its revenue also comes from catering
services that they provide and also from franchising.
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5.0 FINDINGS AND DISCUSSIONS
5.1 FINDINGS
There are a few problems that founded during the Kentucky Fried Chicken Saujana
Utama operation which is the bad customer services. The customers claimed that they had
to wait for hours to get their completed orders. Sometimes the customers experienced
cancelled orders by the KFC Saujana Utama staff members.
Next is the not user friendly website interface of the KFC Saujana Utama website.
This is because the customers keep facing the slow loading speed to access their orders.
The website itself is complicated as the customers face difficulties to search for the menu
and vouchers. The customers also face difficulties to select the delivery locations as there
are only certain locations that covered for the delivery such as Alam Bina college residents.
Third, the lack of staff members skills. Sometimes there are a few issues where the
staff members couldn‟t settle the orders billing system problems by themselves. This
requires them to ask for help from their staff managers.
Lastly, the bad quality of the products. The customers experienced bad products
quality such as the product that they ordered is not the same compared to the menu given.
This lead to the bad reputation of Kfc Saujana Utama images as the customers feel like they
get scammed from the Kfc Saujana Utama store.
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5.2 DISCUSSIONS
Based on the findings collected, we noticed that the bad customer services and lack
of staff members skills problems are caused by the lack of training given. The training is
important as it can provide the staff with equipment knowledge and skills. The trained staff
can help the store to solve the upcoming problems that might be occurred in future. This will
help the store to prevent wasting money to settle those problems such as billing machine
and long queue waiting for problems.
Next, the not user-friendly of KFC Saujana Utama website. We noticed that these
issues caused by the lack of websites preferences updates. The website itself does not
follow the updated website preferences nowadays. Compared to their competitors which is
McDonald‟s, they come out with their own apps that attract the customers to use it more to
get the vouchers. Besides that, the location tracked preferences should be upgraded to
enhance their online customers. This is because the statistics of customers based in
Saujana Utama are highly dominated by the Uitm Puncak Alam students. Therefore the KFC
Saujana Utama should follow the McDonalds step in order to give the best customers
experience to their regular customers.
Last but not least, the Kfc Saujana Utama products quality. The different product‟s
standards of the KFC Malaysia branches might have caused these issues to arise. The
products need to be produced according to their standardized product‟s standards. The
wrong products orders size can affect the customers‟ behaviours as they might feel mad
about it. This can lead to trustworthy issues between the Kentucky Fried Chicken Saujana
Utama store and their customers.
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5.3 THEORIES
Tangibles
The layout of the Kentucky Fried Chicken Saujana Utama attracted the customer
as it provides happy eating surrounding especially for the family members.
Reliability
The managers at Kentucky Fried Chicken Saujana Utama emphasize the
reliability in order to avoid the undesirable results of the equipment failure as it can
affect the failures to be disruptive, inconvenient, wasteful and expensive in Ringgit
and lives. The methods used to improve the reliability such as improve the individual
components and provide the redundancy. The examples of reliability are when the
staff changes the lights for better customer vision.
Responsiveness
The Kentucky Fried Chicken Saujana Utama provides the complaints form for the
customers to inform any problems occurred regarding the purchasing orders.
Assurance quality
The Kentucky Fried Chicken Saujana Utama focused on their main attributes
which are known as CHAMPS. The function of CHAMPS is used for the regular
evaluations of their store and to evaluate their customers‟ experiences. The Champs
covers the cleanliness, hospitality, accuracy, maintenance, product quality and speed
of service aspects for the Mystery Customer visit. By doing this, they can analyse the
customers‟ feedback for the upcoming improvement.
Empathy quality
The Kentucky Fried Chicken Saujana Utama continue promoting the main
programs of the Kfc Malaysia programs which are :
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6.0 CONCLUSION
In addition, the KFC Saujana Utama has been dealing with this kind of problems
which tend to make their customers giving a bad rate of their business performance. The
new initiative needed to be taken in order to compete with their biggest competitor which is
the McDonalds in the Puncak Alam area. They have to come up with new marketing
strategies as these two products brands are the most requested orders by the Uitm Puncak
Alam students.
As we knew, the main goals designed by The KFC Saujana Utama is to offer mid-
range dining options to cater to the Malaysian population predominantly middle-class. This
value propositions had made them differs from the other brands because of their homemade
chicken, secret recipe, fast-food chain company, and their product quality assurance. Hence,
the KFC Saujana Utama need to adapt and implement new strategies such as boosting their
tangibles, reliability, responsiveness, assurance quality and empathy quality so that they can
increase their customers‟ interests segmentation of all fast food lovers effectively and not
losing their current business market.
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7.0 RECOMMENDATION AND IMPROVEMENT
There are several flaws that our group has observe from the KFC Saujana Utama,
and for that, we had discussed over the available option and suggest the proper action to be
taken. Those are:
Firstly, by improving customer service. Poor customer service is one of the leading
reasons customers leave the restaurant with no intention of returning. As mention in the
problem statement, Saujana Utama KFC sometimes received complaints from the customer
regarding their foods, waiting times and services given. In this case, customer service has a
huge responsibility and play an essential role in acknowledging and resolving customer
complaints. They need to ensure customer satisfaction and provide professional customer
support. Hence, they need to enhance the quality of customer services. To have great
customer service, teach worker in customer service skills, train them in problem resolution,
encourage customer interaction and ask for feedback from customers. Therefore, by
improving customer service, they can build a customer relationship that can strengthen their
position. As a key to any good relationship, communication is a crucial way to build customer
relationships.
Next, KFC has a delivery service to the customer but some places are not in the list
of delivery included Saujana Utama KFC. Thus, we recommended KFC to expand its
delivery location, especially to rural and countryside. This is because delivery services can
help expand Saujana Utama KFC business and get additional profits. At the same time, KFC
Company also needs to fix and upgrade the mobile apps and website to be more user-
friendly for the customer as this also link to the delivery services given. Many customers
were having a hard time using both, especially mobile apps. User-friendly is when the
application is easy to use, simple, and that the customer can rely on the product. It is easy
to start with the app and understand how to use it, while high complexity is not valuable for
the user. Therefore, KFC should take the initiative to solve the application problem to give
the user an experience that meets their expectations. Understanding their customer‟s online
behaviours gives them insight into what works and what doesn't. The rule of thumb when
designing websites makes it effortless for your users, and they will stay, make it difficult, and
they will leave.
Next, improving the training program. As we know, KFC worker always switches and
they only have a few permanent workers. Usually, the one that served at the counter is
mostly new workers or part-time workers. In this case, they do not have a lot of experience
and skill to engage with the customer. Therefore, in order to improve their working, needing
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in training program must be compulsory for each new worker. The training program will be
made more rigorous to ensure employees understand the value of KFC and food hygiene.
By improving the training program, it can improve employee performance, the employee who
receives the needed training is more able to accomplish in their job. Besides, all foodservice
employees should be trained on the proper food safety principles and procedures because
the repercussions of foodborne illness to a food service operation can be disastrous. This
includes loss of customers and sales, loss of reputation and goodwill, and others. The
training will give the employee a greater understanding of their responsibilities within their
role, and in turn, build their confidence.
Lastly, improve the quality of the product. There is an issue that viral regarding the
size of the chicken that the customer received. This issue affecting all KFC company in
Malaysia including Saujana Utama KFC. The customer already lost their trust in KFC. In
order to regain customer trust after losing it, the responsibility team and operation
department should regularly check their product before distributing it to the customer.
Therefore, by improving the quality of the product, it can arrest declining sales and help to
maintain customer satisfaction and loyalty.
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8.0 REFRENCES
Harness, J. (2018, October 22). List of Good Cashier Skills. Didapatkan dari bizfluent:
https://bizfluent.com/info-8187077-list-good-cashier-skills.html
KFC Kentucky Fried Chicken. (t.t). Didapatkan DECEMBER 5, 2019, daripada canvanizer:
https://canvanizer.com/canvas/G308ac2ysiw
Why KFC business model is so successful? (t.t). Didapatkan DECEMBER 5, 2019, daripada
vizzologi: https://vizologi.com/business-strategy-canvas/kfc-business-model-canvas/
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9.0 APPENDICES
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