KFC Chicken Crisis in UK: a Case Study

Introduction

The famous fast food company KFC forced to temporary closed hundreds of its food outlets in February 2018 in UK due to shortage of chicken delivery. This problem arose when company switched its delivery contract from Bidvest to DHL and QSL.

Background and Context

KFC is an American fast food restaurant chain founded in 1930 by ‘Colonel Harland Sanders’ at ‘North Kentucky’. At first, it was known as Kentucky Fried Chicken and opened its first franchise at ‘Salt Lake City, Utah’ in 1952. It is famous globally for its delicious fried chicken. It is world’s second largest fast food company after McDonald’s. Its “finger lickin' good” franchises can be found in 136 countries with almost 23000 locations.

In the second week of February,2018 KFC switched its delivery contact in Britain to DHL, a company owned by Germany’s Deutsche Post, which put company into the consequences of shortage in chicken delivery. It is asserted by some that a chose had been noticed at delivery depot where chicken was going waste because drives had been left waiting for hours because getting into firm’s new delivery site at Rugby. The chamber said the site was utilized to store chicken before being enrolled to do as such, however KFC's conveyance contractual worker DHL had since enlisted. KFC said it is doing everything it can to 'maintain a strategic distance from' nourishment wastage and DHL said it was attempting to handle the issue.

There is a website named “wired.co.uk” has posted a blog under title “The inside story of the great KFC chicken shortage in 2018”. This blog present fact that –“at around 01:40 on February 14, a collision involving seven vehicles took place between junctions two and three of the M6. One man was killed, and two others injured. Police closed off the area between the two junctions to investigate, and eventually arrested a man on suspicion of causing death by dangerous driving. Shortly afterwards, a pair of Lorries collided near junction one, although neither driver was injured. These three junctions are in the vicinity of Rugby, where DHL's warehouse is located. With its Lorries getting stuck in the traffic as soon as they left the depot, and no other locations to send deliveries from, the delays that would lead to the KFC chicken shortage began here”.

As a result, hundreds of food outlets of company started running out of chicken products. Before the transformation of this delivery contact all the supplies to Britain’s KFC restaurants were delivered by Bidvest a South African owned distributor.

United Kingdom 16 February, 2018 disappointed KFC customers posted on Social media about unexpectedly shut down of some KFC food stores (thesun.co.uk, 2018). This trend followed across Britain and come to know that hundreds of KFC food outlets were closed. The signs on store’s windows were saying: “Sorry, we’re closed. We deliver fresh chicken to our restaurants, but we’ve had a few hiccups with the delivery today. We wouldn’t want to be open without offering our full menu, but we’ll be back at the fryers as soon as we can”. In this meantime, no one was aware that what was going on.

Then on February 17, 2018 KFC confirmed the news that restaurants run out of chicken. A total of 562 KFC food shops were closed within a weekend of disruption this number reached up to 646 on Sunday night. KFC published a list of total 338 out of 900 outlets that were still running on Monday night. Few of them were just running on limited offers only. This crisis was so much complicated that even company was unable to give any statement that when this problem would be resolve.

Challenges

The passion of fried chicken was so strong on people’s mind that they were eagerly waiting KFC to come back on track. Others started switching to other food chain companies like McDonald’s and Burger king. This situation was not less than a nightmare for KFC, because it is customers who help a company to touch the peaks of success. Therefore, it was a challenge for KFC to maintain the public trust.

This problem was taking the look of crisis and company’s reputation was felling down in people’s eyes. It was very challenging for the company to maintain good image in mind of fried chicken lovers.

People started mocking company in different ways. A famous comedian Aurie Styla from London wrote on his twitter that “How can you be out of the one thing you are known for selling”. Danielle Harold wrote on February 20, 2018 “So KFC is just a chips shop now then”. Likewise, Helen wrote on 19 February, 2018 “How can Kentucky Fried Chicken run out of chicken? Next thing you know McDonald's will be running out of Donald.

There were numbers of regular customers who used to go KFC regularly to have at least one meal a day, started calling to police and complaint about this situation. Police was fed up by these types of callings. To stop this ‘Tower Hamlets Police’ posted on their tweeter “Please do not call us about the #KFCCrisis – it is not a police matter if your favorite eatery is not serving the menu that you desire”. It gone so viral on twitter that this tweet has currently been liked more than 20,000 times and has been re-tweeted nearly 12,000 times (Barr, 2018). It was very challenging for KFC to face these social media campaigns.

Solutions

• In March, 2018 KFC came back to its recipes for original chicken delivery by reconnecting with Bidvest after last month’s supply consequences with DHL.
• To deal with social campaign KFC reacted with full page apologized newspaper advertisements by famous marketing team and agency, Mother London.
• KFC used PR strategies via web-based networking media, explicitly captivating with clients on Twitter. #KFCCrisis started slanting on Twitter, so the organization utilized online life strategies to control the story of further harm to the brand. “To put it simply KFC tweeted, we’ve got the chicken, we’ve got the restaurants, but we’ve just had issues getting them together”. Another tweet straightforwardly following the emergency incorporated an amusing realistic that played on a nursery rhyme. The tweet guaranteed to clients that the Colonel is working on it and the graphic exclaimed, “The chicken crossed the road, just not to our restaurants”

Communications Tactics

To handle social media campaigns KFC responded with full page newspaper advertisements that showed a chicken bucket with its KFC logo rearranged to “FCK”. The accompanying text read: 'WE'RE SORRY. A chicken restaurant without any chicken. It's not ideal ... Thank you for bearing with us'.

KFC also included- “we are huge apologies to customers, especially those who traveled out of their way to find us and unfortunately we were closed. An endless thanks to our KFC team members and our franchise partners for working tirelessly to improve the situation. It’s been a hell of a week, but we’re making progress, and every day more and more fresh chicken is being delivered to our restaurants”.

Being apologized to customers was appreciated and was so successful that it won the praise of consumers as well as PR and marketing specialist in UK and US. After this KFC accounted bit stability in sales and helped to maintain brand reputation. This ad was so effective that some people started considering KFC’s chicken shortage crisis as a public stunt. All this credit goes to PR team of KFC.

Results

KFC reestablished its agreement with former distributer partner Bidvest logistics by sharing some duties to DHL. The understanding implies that from March 26, Bidvest will assume control over supply for 350 eateries in the north of the UK, while DHL and QSL proceed with their very own work in the south.

Company’s apologized reaction was so welcomed by people and they started showing sympathy with KFC, but still company’s sale rate fell by three per cent, and it took time for company to recover this loss.

Strenghts

• KFC politely apologized to its customers, which helped it to won the sympathy and trust of people.
• KFC re-engaged Bidvest and said “back to business as usual”.
• Company didn’t blame DHL directly for this problem. But gave reviews to public that it is very complex for a new company to serve a large number of outlets with chicken delivery
• Company always uses fresh chicken from British and Ireland’s farms, which it says is healthier than frozen one’s, even during this bad time company didn’t use any other way to serve people with chicken and continue its business. Company was facing loss in business and brand name in these days, but didn’t use frozen chicken to handle this crisis. Company also implements even more regulations on itself for using chicken, than they are asked to follow by British’s law.

Weaknesses

• KFC easily relied on DHL and sign its delivery contract with it.
• Company hired a large number of fresh workers and supply chain team members during that time, which result malfunction to KFC’s supply chain management. “Most people in this country simply don’t understand how the supply chain works until it goes wrong,” said Rod McKenzie, a director at the Road Haulage Association
• New and untested storage centers.
• DHL and KFC didn’t have any backup plan.

Recommendations

KFC should always have a backup plan, which would be helpful to face these types of crises in future. As right after this crisis KFC also had to face gravy shortage problem.

KFC should not rely on any new company without understanding their work load. Because for any new company or technology it would always be complicated to deal with heavy responsibilities. KFC should work on their team hiring process. It would always been risky to hire large number of team members at one time. Supply chain management needs to be up to date all the time, because most of the businesses are biased on it. During KFC’s chicken crisis in UK, some people were blaming to KFC’s supply chain management, which was justice at some point because it is supply chain management who always cares the supply and delivery matters.

Samir Dani, professor of logistics and supply chain management at the University of Hudersfield, said: “The situation now shows business continuity was not thought out very well.” When things started to go wrong, the single distribution center “becomes a major constraint to the delivery system”. He added that because the product being delivered was perishable and subject to strict food safety rules, he believed “there should have been at least two sites”. That would have provided a back-up and helped deal with the potential for food safety problems, he said, but would likely have been more expensive.

Before any crisis take place, it is always important to appoint with a response team. The next step is to organize a strategy to use. Finally, all of the team members should assign with clear duty.