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1. Introduction of KFC
KFC Corporation was Iounded by Colonel Harland Sanders in 1952. KFC, also known as Kentucky
Fried Chicken is a chain oI Iast Iood restaurants based in Louisville, Kentucky, in the United States.
KFC is part oI Yum! Brands, Inc (the world`s largest restaurant company in terms oI system
restaurants, with more than 36,000 locations around the world). Every day, KFC serves more than 12
million customers in 109 countries and territories around the world. KFC operates more than 5,200
restaurants in the United States and more than 15,000 units around the world.
We still take pride in doing things The Colonel's way, utilizing only the highest quality ingredients,
innovative recipes, and time-tested cooking methods.

I|gure 1 Co|one| nar|and Sanders
So come and dine with us, or take some home - any way you like it. Only KFC has so much tasty
chicken, Iresh Irom our kitchens, just Ior you.
KFC Corporation, based in Louisville, Kentucky, is the world's most popular chicken restaurant
chain, specializing in Original Recipe, Extra Crispy, Twister and Colonel`s Crispy Strips
chicken with home style sides.
Every day, nearly eight million customers are served around the world. KFC's menu includes Original
Recipe chicken -- made with the same great taste Colonel Harland Sanders created more than a
halI-century ago. Customers around the globe also enjoy more than 300 other products -- Irom a
Chunky Chicken Pot Pie in the United States to a salmon sandwich in Japan.
In quite a Iew U.S. cities, KFC is teaming up with sister restaurants, A&W, All-American Food,
Long John Silver's, Taco Bell and Pizza Hut, selling products Irom the popular chains in one
convenient location.
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Over Sixty years ago, Colonel Sanders invented what is now called "home meal replacement" --
selling complete meals to busy, time-strapped Iamilies. He called it, "Sunday Dinner, Seven Days a
Week."
Today, the Colonel's spirit and heritage are reIlected in KFC's brand identity -- the logo Ieatures
Colonel Harland Sanders, one oI the most-recognized icons in the world.


KFC is part oI Yum! Brands, Inc., which is the world's largest restaurant system with over 32,500
KFC, A&W All-American Food,Taco Bell, Long John Silver's and Pizza Hut restaurants in more
than 100 countries and territories.

. Problem Identification
W Poor relationship Between Pepsi Corporation and KFC Iranchises.
W KFC looses their market share because oI other chicken chain competitors (Popeye`s,
Chick- Iill-A, Boston Market, and Church`s) increase sales at a Iaster rate.
W Cultural Iactors inIluence when they going to expand their business overseas.
W Other chicken chain competitor`s diIIerentiate their products. (For example Boston
Market introduce new restaurant chain that emphasized roasted chicken rather than Iried
chicken.
W ConIlicts between KFC and Pepsi Cola`s corporate cultures create a moral problem
within KFC.
W Low Research and Development Iunding Irom Hubel in, the division Iound it diIIicult
to match the expansion plans oI its main competitors.
W Local Iranchisees oIten were more interested in maximizing proIits in the short term
rather than to adhere to corporate standards and strategic plans.




I|gure 2 kIC Logo
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. Assumption
Strategic management is concerned with matching the organization`s internal capabilities with
the external opportunities and threats and developing plans to achieve the medium to long-
term goals. There are Iew Assumptions need to make in order to achieve those goals.
W Foreign exchange rates dose not change signiIicantly.
W Political instability in Asia not last long.
W Current tax system not going to change
W Bank interest rate will be stable.
W No new environmental laws introduce Ior the industry
W KFC should ignore their competitors in the Iast Iood restaurant chain, such as
McDonald`s which is technically in the sandwich segment and go where it will be more
proIitable.
W Fast Iood chains had already experimented with new Iorms oI existence such as in
shopping malls, airports, department stores, universities, etc
W Socio-cultural trends in U.S. were Iavourable to the Iast Iood industry, except Ior
consumer demands Ior lower and lower prices.

. Situation Analysis
.1. S.W.O.T Analysis
It is an easy-to-use tool Ior developing an overview oI a company`s strategic situation. It Iorms a
basis Ior matching your company`s strategy to its situation.
(I)Strengths
1. KFC is the world`s biggest chicken restaurant chain and 3rd largest Iast-Iood chain.
2. KFC is a market leader in chicken Ioods Ior 50 years. It has more than 50 percent oI the
market share and has secret recipe oI spice and 11 herbs.
3. KFC is a most identiIiable brand in chicken/Iried Iood.
4. It has the strong location, store management, motivated work Iorce and Iranchises.
5. KFC has a good image all over the globe and is globally placed Ior many years.
6. KFC is Iocusing on the global strategies to raise its corporation and Iranchise restaurant base
all over the globe.
7. It has a strong distribution network such as outlets in shopping malls, airports, etc.
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II)Weaknesses
1. KFC is not innovative because it serves only the chicken products to the customers. It does
not oIIer new or diIIerentiated products.
2. KFC Iell aIter the market in oIIering new products because it was doubling other Iast Iood
chains to remain competitive.
3. Mergers with diIIerent corporations resulted in big cultural problem Ior KFC employees such
as Merger with PepsiCo.
4. The company is only Iocusing on Iew locations and is ignoring to visit or check standards at
Iranchises in diIIerent countries.
5. KFC is Iacing problems to maintain the higher standards oI hygienic Iood. It is being charged
in diIIerent countries due to poor standards oI hygienic Iood. Some oI the important examples
in this regard are given as:
a. In 2007, a Taco Bell/KFC outlet in New York City was initiated to be rat inIected.
b.. In 2009, a KFC store in London was also charged with 13 Iood hygiene Iines.
c. A court case in 2010 exposed poor hygiene at a KFC store in Sydney, Australia.
III)Opportunities
1. Changing demographic trends provides opportunity to diversiIy into new products and
locations.
2. Increasing demand Ior IoodstuII eaten outside the home.
3. Expand globally to capture the untapped markets and increase the revenue.
4. The company can take advantage oI NAFTA (North American Free Trade Agreement).
5. Expansion Ior the Latin American markets/ Mexican market.
6. Consumers are becoming health-conscious; introduce new products line Ior this segment.
7. Be environment responsible because it will improve the public image oI KFC and will help it
to increase its revenue.
8. DiversiIy into other Iast-Iood and meals.
IV)Threats
1. KFC is Iacing strong competition Irom its competitors, such as McDonalds, Yum and
Subway.
2. It is also Iacing competition Irom local restaurants in diIIerent countries oI the world.
3. The company is Iacing problem in maintaining same standards at their international
Iranchises.
4. To sustain a market leadership position in the global Iast-Iood industry.
5. Sustaining U.S. market leadership is also another important threat Ior the company.
6. Other players are turning to new menu oIIerings, location and outlets.
7. Increasing number oI health conscious consumers.
8. Saturated Iast Iood industry in the U.S Market.
9. Technological improvements


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. Industry and Competition Analysis
The Iive Iorces model oI competition expands the arena Ior competitive analysis.
Historically, when studying the competitive environment, Iirms concentrated on companies with
which they competed directly. However, today competition is viewed as a grouping oI alternative
ways Ior customers to obtain the value they desire, rather than as a battle among direct competitors.
This is particularly important, because in recent years industry boundaries have become blurred.

..1. Threat of new entrants
Evidence suggests that KFC have always Iound it diIIicult to identiIy new competitors. This is
unIortunate, in that new entrants oIten have the potential to be quite threatening to
incumbents. One reason new entrants pose such a threat is that they bring additional
production capacity. Unless the demand Ior a good or service is increasing, additional
capacity holds consumers` costs down, resulting in less revenue and lower returns Ior an
industry`s Iirms. OIten, new entrants have substantial resources and a keen interest in gaining
a large market share. As a result, new competitors may Iorce existing Iirms to be more
eIIective and eIIicient and to learn how to compete on new dimensions

... Bargaining power of suppliers
Increasing prices and reducing the quality oI products sold are potential means through which
suppliers can exert power over Iirms competing within an industry. II a Iirm is unable to
recover cost increases through its pricing structure, its proIitability is reduced by its suppliers`
actions. A supplier group is powerIul when:
F It is dominated by a Iew large companies and is more concentrated than the industry to
which it sells;
F SatisIactory substitute products are not available to industry Iirms;
F Industry Iirms are not a signiIicant customer Ior the supplier group;
F Suppliers` goods are critical to buyers` marketplace success;
F The eIIectiveness oI suppliers` products has created high switching costs Ior industry
Iirms
F Suppliers are a credible threat to integrate Iorward into the buyers` industry.
Credibility is enhanced when suppliers have substantial resources and provide the
industry`s Iirms with a highly diIIerentiated product.
As a result oI its success, initially in its US domestic market and now globally as well, Wal-
Mart is an example oI a company over which Iew suppliers have power. The sheer size oI its
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purchases and the relatively low switching costs it Iaces when choosing among suppliers oIten
combine to yield signiIicant power Ior the Iirm.
... Bargaining power of buyers
Firms seek to maximize the return on their invested capital. Buyers (KFC customers oI an
industry or Iirm) want to buy products at the lowest possible price, at which the industry earns
the lowest acceptable rate oI return on its invested capital. to reduce their costs,
buyers/customer`s bargain Ior higher quality, greater levels oI service and lower prices. These
outcomes are achieved by encouraging competitive battles among the industry`s Iirms.
Customers (buyer groups) are powerIul when:
4 They purchase a large portion oI an industry`s total output;
4 The product being purchased Irom an industry accounts Ior a signiIicant
portion oI the buyers` costs;
4 They could switch to another product at little, iI any, cost; and
4 The industry`s products are undiIIerentiated or standardized, and the buyers
pose a credible threat iI they were to integrate backward into the sellers`
industry.
... Substitutes
One oI the main problems that Iace many companies today is the threat oI substitute products.
There main substitute products competitors are McDonalds, Burger King, Wendy`s,
Domino`s, chi-Ii -A and Boston market, Popeye`s, etc.
..5. Industry rivalry
Beyond seeking to deter entry, Iirms also use strategies to reduce the level oI industry rivalry
because unrestricted competition over prices or output can reduce proIits. Several strategies
are available.
1. Price signaling is the process by which Iirms convey their intentions to rivals concerning
pricing strategy, or how they will react to the competitive moves oI their rivals. Firms can
announce that they will respond vigorously to other Iirms` hostile moves iI attacked. Also it
indirectly allows Iirms to coordinate their prices.
2. Price leadership, in which one Iirm takes the responsibility oI setting industry prices, is
another way oI using price signaling to enhance industry proIitability. The price-setter creates
a model that other Iirms can Iollow.
3. Non-price competition usually occurs through product diIIerentiation whereby Iirms
compete Ior market share by oIIering products with diIIerent or superior Ieatures, or by
applying diIIerent marketing techniques. There are Iour non-price competitive strategies.
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a. Market penetration involves expansion oI market share in a Iirm`s existing product
markets by advertising and other promotional means.
Example: Toys R Us based its CA on being a low-price, low-service store but now
competes on having more toys in stores than competitors.
b. Product development is the creation oI new or improved products to replace existing
ones. It can help to maintain product diIIerentiation and build market share.
Example: KFC very recently they rolled out buIIet that included some 30 dinner,
salad, and dessert items.
c. Market development involves Iinding new market segments Ior a Iirm`s existing
products. It uses the Iirm`s brand name to get market share as it enters these segments.
d. Product proliIeration (a range oI products Ior a range oI niches) is also a strategy Ior
managing rivalry. Firms compete over perceived quality and uniqueness.
4. Capacity control is aimed at controlling the level oI industry output. Although Iirms preIer
non-price competition, periodically price competition does break out.
This occurs because industry over-capacity leads to reduction in prices Ior Iirms attempting
to dispose oI the product. II one Iirm reduces prices, the others Iollow to avoid being leIt with
unwanted goods.
Excess capacity can occur because oI new low-cost technology or new entrants. Two
strategies are available:
a. A preemptive strategy is used when one Iirm, recognizing an opportunity, moves
quickly to establish a Iirst-mover advantage. It hopes that other Iirms will recognize
that they are too Iar behind to catch up and thus not increase their capacity.
b. A coordination strategy involves Iirms signaling their intentions concerning their
Iuture capacity to one another. By indirectly inIorming one another oI their plans, they
seek to ensure that capacity does not become so large that it promotes a price war. As
a result, the risks associated with increasing capacity (investments therein) are
reduced.





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.. Trend Analysis
The number oI demographic and societal trends inIluenced the demand Ior Iood eaten outside oI the
home.
..1. Consumer Decision Making Trends
During the last two decades, rising incomes, greater aIIluence among a greater percentage oI
American households, higher divorce rate, and the Iact that people married later in liIe
contributed to the rising number oI single households and the demand Ior Iast Iood. More than
50 oI woman worked out side oI home, a dramatic increase since 1970. They expect this
percentage going up over 65 by 2010. Less time to prepare meals inside the house added to
this trend.
Labor cost made up 30 oI a Iast Iood chain`s total costs, second only to Iood and beverage
costs. Intense competition. However, made it diIIicult Ior restaurants to increase prices
suIIiciently to cover the increased cost oI labor. There are many Iast Iood restaurants in the
Iast Iood market, and it has diIIerent Iood with diIIerent taste, price and quality. Consumers
do not like eat same Iood with same taste every day. ThereIore consumers could change their
decisions and move to purchase another product because there are lots oI substituted products
in the market. Consumers made decisions about where to eat partially based on price. There
was another important Iact is time duration. Consumers there`re always expect Fast and
Quality service. Most oI the restaurant operation viewed computers as their number one tool
Ior improving eIIiciency. New technology may help to increases customer attention to
purchase the product. For a e.g. Mc Donald and Carl`s, converted to new Iood preparation
systems that allow them to prepare Iood more accurately and to prepare a great verity oI
sandwiches using the same process.
Restaurant location also the very impotent Iacts to make Consumer decision consumer.
Consumers always looking Ior conveyable place to purchase there needs.
... Demographic trends:
a)Income:
More than 50 oI woman worked out side oI home, a dramatic increase since 1970. They
expect this percentage going up over 65 by 2010. Double- income households contributed to
rising household incomes and increased the number oI times Iamilies ate out.
b) Life style trends:
Higher divorce rates and the Iact that people married later in liIe contributed to the rising
number oI singles household and the demand Ior Iast Iood. AIter 1970 more than 50 percent
increase oI women worked outside oI the home and this number was expected to raise 65
percent by 2010. Household income also eIIect to change the consumers liIe style.
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As consumers aged, they become less enamored with Iast Iood and were more likely to
patronize dinner houses and Iull- service restaurants. Sales oI Mexican restaurant were very
popular with American people in 1980`s, began Indian, Japanese and Vietnamese restaurant
are become a more Iashionable.
Ethnic Iood in general was rising in popularity as U.S. immigrants, who constituted 10 oI
the U.S. population in 2000, looked Ior establishments that sold their native Ioods.
c)Age
In the Iast Iood industry baby boomers (age 35-50) are the largest consumer group, and
Generation Xers (ages 25 to 34) and the 'mature category (ages51 to 64) made up the second
and the third largest group in the market respectively.
The greatest concern Ior Iast Iood operations was the shortage oI employees in the 16 to 24
age category. Most American in this age category had never experienced a recession or an
economic downturn.
... Competitive behavior trends:
E Competition with in Iast Iood industry is particularly strong due to the large number oI
stores and their geographic proximity.
E Competition tends to be based on price, range oI Iast Iood products, quality, service,
location and promotion.
The number oI Iactors will lead to increase oI competition. One oI the most important will be
continuing diIIusion oI the Iast Iood industry. Even as competitive strength increases, leading
Iast Iood industries will become more adept at anticipating the responses oI their competitors.
Instead oI using destructive competition, businesses will tacitly cooperate on price and
promotion and seek competitive advantage based on superior understanding oI customers
need and eIIective management oI the innovation process to meet those needs.
a) Who are the Key Competitors?
There are was eight major segments made up the Iast Iood sector oI the restaurants industry:
sandwich chains, pizza chains Iamily restaurants, grill buIIet chains, dinner houses, chicken
chains, non dinner concept, and other chains.




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Other indirect fast food restaurant competitors are:




Sandwich chain: - McDonalds, Burger King, Wendy`s, Taco Bell, Subway and etc.
Dinner Houses:-Applebee`s, Red Lobster, Outback Steakhouse, Olive Garden and
etc. Pizza Chain: - Pizza Hut, Domino`s, Papa John`s, Little Caesars, Sabarro and etc.
Family Restaurant: Denny`s, Craker Barrel, IHOP, Shoney`s and etc.
Other dinner chain: - Long John Silver`s, Walt Disney Co, Old Country BuIIet &
etc.
Grill Buffet chain: - Golden Corral, Ryan`s and etc.
No dinner Concepts: - Dunkin`s Donuts, 7-Eleven, Starbuks and etc.
McDonald`s with sales oI more than $19 billion in 1999, accounted Ior 15 oI sales oI the
sales oI the nation`s top 100 restaurant chain. According to the sales Iigure shown that second
largest chain burger King had less than a 7 share oI the market.
Sandwich chains (McDonald 35, Burger king 16, Wendy`s 9.7, taco bell 9.6, subway
5.9, etc.) made up the largest segment oI the Iast Iood market.
(Source; JeIIrey A Krug, 2001, p208)
According to the above Iigure we can identiIied, McDonald`s is generated the greatest per
store sales about $1.5 million per year. The average U.S. chain generated $800`000 in sales
per store in 1999.
b)On what basis do they compete?
Boston market was a new restaurant chain that emphasized roasted rather than Iried chicken.
It successIully created the image oI an upscale deli oIIering healthy, 'home style alternatives
to Iried chicken and other Iast Iood.
Dinner house came Irom new unit construction, a market contrast with other Iast Iood chains,
which had already slowed U.S construction because oI markets and small towns.


I|gure 3 Compet|tors
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(c)How successful are they?
Sales oI dinner houses increased by more than 13 during the year, surpassing the average
increase oI 6 among all Iast- Iood chains.
The hardest-hit segment was grilled buIIet chains, which generated the lowest increase in
sales( less than 4).dinner houses, because oI their more upscale atmosphere and higher-
ticket items, were better positioned to take advantage oI the aging and wealthier U.S
population, which increasingly demanded higher- quality Iood in more attractive settings.
Dinner houses, however, Iaced the prospect oI market saturation and increased completion in
the near Iuture.
d)What are the key industry success factors?
W The Colonel perIected his secret blend oI 11 herbs and spices Ior Kentucky Fried
Chicken in 1939 and signed up his Iirst Iranchisee in 1952. By the time KFC was acquired by
PepsiCo in 1986, it had grown to approximately 6,600 units in 55 countries and territories.
W KFC restaurants oIIer Iried chicken products and some also oIIer non-Iried chicken-
on-the-bone products, with the principal entree items sold in pieces under the names Original
Recipe, Extra Tasty Crispy and Tender Roast.
W KFC restaurants also oIIer a variety oI side items, such as biscuits, mashed potatoes
and gravy, Cole slaw and corn, as well as desserts and non-alcoholic beverages.
W In 1996, KFC's worldwide system sales oI over $8 billion grew Iaster than the industry
average even though the number oI restaurants in its global system did not materially increase.
W Quality, service and cleanliness represent the most critical success Iactors to KFC's
global success.
W Adequate capitalization, to provide reserves against market downturns and to beneIit
Irom market upturns.
W There was another main Iactor is they conduct the business in an environmentally
responsible way. There`re complying with all applicable laws and regulations and provide
saIe and healthy work environments. In the absence oI speciIic laws and regulations we
continue to operate responsibly.
W Using research and new technology, we work to improve our environmental
perIormance through source reduction, recycling and innovative product packaging.
W There are known Ior great operations, marketing innovation, delivering the highest
quality Iood and superior service by responding to the voice oI the customers, not just
listening to them.
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W In Asia, we launched two delicious new product variants, Honey Mustard Twister and
Spicy Twister, which are helping to drive strong sales growth in the region.
W Reliable supply oI key raw materials at a competitive price.

.. Company Analysis
..1. Organizational Strategy
Organizational strategic plan can be divided in to two parts such as corporate level strategies
and Business, unit, product and market level strategies. ( Kotler P, Armstrong G, Meggs D,
Bradbury E, Grech.J, 1999, pp448)
.. Corporate level strategies
DeIining the company mission : KFC`s parent company Yum Brand Inc., mission
is satisIying customers every time they eat their Iood and doing it better than any other
restaurant company with their sister companies such as A&W, KFC, Long John Silver's,
Pizza Hut, and Taco Bell. They oIIer customers to Iood they crave, comeback value, and
customer-Iocused teams. The unique eating experience at each oI their restaurants make their
customers smile and inspire their loyalty Ior liIe. (www.yum.com)
a) Setting company objectives and goals:
KFC`s parent`s company mission needs to be turned into detailed supporting objectives Ior
each level oI management. Each manager in the industry should have objectives that they are
responsible oI archiving and that Ilow down` through the levels oI the organization. These
mangers have a responsibility to increase or keep the market share stable. In the case study
explain during 1980s to 1990s surrounded it limited menu and suddenly they introduce new
products in the Iast Iood market as a strategy.
b) Designing the business portfolio:
The business portIolio is the one that best Iits the company`s strengthens and
weakness to opportunities in the environment. KFC always try to expand their
business as a strategy to increase global market share using Iranchise system and the
company owned system. They always try to keep high growth and high share in the
Iast Iood industry, but the co emption always against them. To keep competitors down
they need to use new strategies to grow their business and market share.



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.. Business strategy
W Planning: KFC`s marketing plan is satisIying customers by designing strategies and
delivering a marketing mix targeted at deIined market segments and aimed at achieving a
series oI marketing objectives which combined to meet their company objectives.
W Marketing: Customer value and satisIaction are the most important ingredient that
the KFC looking when they market the product. They always try to provide good quality
products with low cost to the customers. They change the taste oI the product when the
customers do not like.
W Perceived competence all businesses are public and diversiIied activities were high
volume, low cost products with strong brand names.
W Market leadership diversiIication moves typically started by capturing a signiIicant
domestic market share through the acquisition oI companies with highly visible or quality
brand names.
W Restructuring considerable success in taking what had appeared to be relatively
expensive acquisitions and reduced the cost through stripping out unproductive assets, and
investing capital to improve productivity.
W Strong brands and customer focus managing outstanding brands with high public
awareness.
W Acquire or develop world best` technology.
W International expansion.
W Financial control and performance measurement.
W Organization and management
W Management development.
... Developing Crowtb Strategies
a)Market Penetration Strategies
W Attracting Competitor`s customers DiIIerentiation oI products such as new menus
design which shows clearer diIIerentiation Irom competing Iast Iood.
W Increasing Promotional EIIort - Mass advertising within the domestic and globally
W Decreasing Prices. - Special oIIers price competition things such as student discount.
Product Development Strategies
W Product line extensions - OIIer customers with varieties Iood.
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W Developing quality variations - Developing Iood quality oI the KFC.
W Developing new products aiming at the present market - Develop new products those
related to the countries cultures.
b) Market Development Strategies
W New Geographical Markets
*Setting up Iranchising and merger systems using the regional and national expansion.
*Attracting Investors by consolidating the positioning and image oI the business and be well
known and trusted.
*Advertising in other media such as on the internet where globally executed.
*Lowering price to attract price sensitive buyers and increasing price on certain product and
services in order to attract prestige and quality seekers segments
(c)Diversification
E Into related businesses (concentric diversiIication)
Fabricating assortment oI menus Ior breakIast, lunch and dinner.
Cheap quality foods for lower class
d) What Generic Strategy is it Pursuing
Generic strategy can be divided into three parts.
W Focus strategy
W DiIIerentiate strategy
W Cost leadership strategy (www.business.bond.edu.au)
KFC`s Iocused on their product diIIerentiate to reduce substitutability with rivals: -
KFC still experimented with the chicken sandwich concept when McDonald`s test marketed
its 'Mc`Chicken Burger in the Louisville market. Shortly McDonald`s rolled out the Mc
chicken sandwich nationally. By beating KFC to the market.
By the late 1990s, KFC had reIocused its strategy. The cornerstone oI its new strategy was to
increase sales in individual KFC restaurants by introducing a variety oI new products and
menu items that appealed to a greater number oI customers. KFC settled in three types oI
chicken product: original recipe, Extra Crispy and Tender Roast.
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When consider the generic strategy KFC can be diIIerentiating their products in many ways,
such as quality, uniqueness, responsiveness and prestige oI the product. For example when
KFC try to expand their business to overseas they need to Iocus on the product diIIerentiate
because those countries should have diIIerent cultures, taste and values. KFC very recently
they rolled out buIIet that included some 30 dinner, salad, and dessert items. The buIIet was
particularly successIul in rural locations and suburbs. It was less successIul in urban locations
because oI space considerations. KFC then introduced its colonel`s Crispy Strips and Iive new
chicken sandwiches to appeal to customers who preIerred boneless chicken products.
II a Iirm can consolidate a Iragmented industry, it can achieve high return on investment. It
has occurred in retailing (Ior example, Wal-Mart) in Iast Ioods, (McDonald`s and KFC), and
in legal and accounting Iirms (Baker & McKenzie). Firms seeking to consolidate their
industries and become leaders use strategies oI chaining, Iranchising, and horizontal merger
With this strategy, based on cost-leadership, a Iirm establishes networks oI linked stores or
service-centres that are so closely interconnected as to simulate one large entity. The Iirm uses
regional distribution centres to reduce transportation & inventory holding costs; it increases its
buying power vis-a-vis suppliers; and it realizes economies oI scale by sharing management
costs and advertising across stores.
.. Uperations
..5.1 Plant Locations
KFC had expanded early in their corporate history and their experience operating abroad put it
in a strong position to take advantage oI the growing trend toward international expansion. In
year 2000, more than 50percent (5,595 restaurant) oI the KFC`s restaurants were located
outside the United States and the rest oI the restaurant located inside the United States. Their
major overseas markets are located in Mexico, China, Canada, Australia, Puerto Rico, Korea,
Thailand, and United Kingdom.
..5.. Equipment Technology, Use Age, Flexibility, Capacity utilization)
Technology use: Cost could also be lowered and operation made more eIIicient by increasing
the use oI technology. Most restaurant operators viewed computers as their number one tool
Ior improving eIIiciency. For an e.g.: improve labor scheduling, accounting, payroll, sales
analysis etc..
Most restaurant chains were also using point oI sales systems that recorded the selected menu
items and gave the casher a breakdown oI Iood items and the ticket price. Currently the
company looking Iorward to develop their production cycle by the use oI modern technology.
The best example would be the use oI new recycling papers
Age: the age category between 16 -24 are widely used staII which the company tend to
employ. It creates good job opportunities as well as a good experience.
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Capacity utilization: higher cost and poor availability oI prime real estate was another trend
that negatively aIIected proIitability.
A plot oI land suitable Ior a normal sized Ireestanding restaurant cost between $1.5 and $2.5
million. Leasing was a less costly alternative to buying. Nevertheless, market saturation
decreased per store sales as newer unit`s cannibalized sales Ior existing units.
since there are variety oI retail outlets the company tend to move into non traditional methods
such as opening outlets as, hospitals, shopping molls, air ports, gas station, Iood court and in
highly crowded public areas.
Flexibility- To make meal planning easier and more convenient, KFC has partnered with
cybermeals, Inc., the Internet`s largest online ordering system, to give San Diego residents the
option oI ordering KFC Ior delivery or takeout via the Internet. Customers will be able to
place online orders only when they are within a KFC delivery area and during business
hours. (http://www.kIc.com/about/pr/020999.htm)
..5. Operating cycle
The company`s operating cycle mainly based in to two types which are company owned and
Iranchise by the company. The main purpose oI the operating cycle is to dominate the
international and domestic market. KFC`s early international strategy was to grow its
company and Iranchise restaurant base throughout the world. By early 2000, KFC had
reIocused its international strategy on several high growth markets such as Canada, Australia,
UK, china, Korea and etc. KFC hope planned to expand their company owned business into
other international market in Europe and lain America in Iuture.
..5. . Cost structure, cost drivers
The topical emphasis is on productivity growth and its dependence on the cost structure. The
methodological Iocus is on application oI the tools oI economic analysis the `thinking
structure\' provided by microeconomic theory to measure technological or cost structure,
and link it with market and regulatory structure. This provides a rich basis Ior evaluation oI
economic perIormance and its determinants. (Sources: http://kapis.www.wkap.nl/prod/b/0-
7923-8403-2)
..5.5. Break Even Analysis
When consider the companies break even analysis can be used to evaluate the relationship
between Iixed cost, variable cost, selling price, and proIit using the basic Iormula: break- even
analysis setting price to break even on the cost oI making and marketing a product or setting
price to make a target proIit.


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..6. Human Resources
..6.1. Organization Structure
KFC has seen 4 diIIerent management structures in the last 50 years. The management
philosophy employed by each one oI these companies has been diIIerent, creating a constantly
changing environment Ior company employees and Iranchisees. PepsiCo (now YUM brands),
the parent company oI KFC, places an added emphasis on perIormance and is closely looking
at ways to increase return on equity by buying out under-perIorming restaurants and investing
in company-owned restaurants. This has created a strained relationship between corporate
management and KFC Iranchisees. (www.google.com)
..6.. Reward Systems
KFC knows a thing or two about Iood-and it knows about parents and kids. Now, with the
introduction oI its new Kids Laptop Pack kid`s meal, it brings together all oI these honest-to-
goodness truths:
W kids are picky;
W kids don't like their Iood touching other Iood;
W kids want to eat at their own pace; and
W Kids want to Ieel in control oI their mealtimes as they push the limits oI both their
own independence and their parents' patience. (Louisville, KY, Nov. 13, 2002
http://www.kIc.com/about/pr/111302.htm)

To gain a customer reputation and customer satisIaction the company tends to oIIer verity oI
rewards schemes as strategy to attract customers. The reason rewards system was to draw
coupons and prize draw.
As part oI KFC's ongoing commitment to diversity and the development oI its associates,
KFC will provide one scholarship per year over the next Iour years to eligible students
attending UNCF schools. (http://www.kIc.com/community/uncI.htm)
..6. Dominate attitudes and values culture)
With the on going progress oI the Tricon Global Restaurants Company, Kentucky Fried
Chicken will continue to grow and expand in order to IulIill the wants and needs oI an ever
changing society. As they expand into diIIerent countries they adapt to Iit the local tastes and
trends in accordance with local customs and belieIs. The use oI local management in the
Iranchises has beneIited KFC because oI there knowledge oI the local market. Their Ilexibility
and determination to provide quality, service, and cleanliness while Iocusing on the speciIic
demographics oI each speciIic region.
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..6. Number of locations, physical and reporting relationships between related areas
KFC is part oI Tricon Global Restaurants, Inc., which is the world's largest restaurant system
with nearly 30,000 KFC, Taco Bell and Pizza Hut restaurants in more than 100 countries and
territories. KFC has more than 11,000 restaurants in more than 85 countries and territories
around the world. Kentucky Fried chicken corporation use Iranchise Ior expand their business
around the world. The mother company oI the KFC located in United States and they
Iranchised their business to other countries to make more proIits.

..6.5 Key personalities
E Good relationship with consumers, suppliers and the workers.
E Outstanding employees within the organisation. .
E QualiIied employers are Iitted to the right job.
E KFC listen and respond to the voice oI the customer
E They believe in people, trust in positive intentions, encourage ideas Irom everyone and
actively develop a workIorce that is diverse in style and background.
E We do what we say, we are accountable, we act like owners.
E Good management skills.
E We execute with positive energy and intensity...we hate bureaucracy and all the
nonsense that comes with it.

.. Marketing
Since a company has in a good reputation over the product its marketing strategy would be
clearly deIined as a major part oI the company. By use oI 4P`s the KFC had developed their
marketing strategies.
Products: Innovate new products with new tastes. Team oI leading technologists that do
research Ior develop new tastes oI Iast Iood Ior KFC in many years to attract customers.
Place: Expand the yum brand products to other countries with the suitable menus. When
reopen the new restaurant they need to consider the competitors behavior in the particular
area. KFC have good distribution chancel Ior supply their products to the Iranchisees.
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Price: Create attractive price that can aIIord all social classes. Marketing manager will be
doing with the help oI Iinancial department. To have very attractive and proIitable price Ior
both us and the consumers
Promotion: Start advertising in TV radio and internet, also billboards bus shelters and public
transports. The promotions manager will take the responsibility. It has to be inIorm consumers
in around the world when the new menus introduce to the local and international markets.

..8 Researcb and development
KFC should emphasize on growing the KFC Iranchises abroad. This will allow KFC to
expand into diIIerent countries with less capital investing. By allowing Iranchisees larger
Ilexibility as they expand abroad, they will have a better chance to appeal the local markets. It
will be important to make an investment in Research & Development in order to better
determine what countries will provide the best growth opportunities Ior the organization. In
addition, KFC should build ties with local organizations in these Ioreign in order to achieve
brand recognition in these new markets.
According to 2000 annual report Research and development expenses were $24 million in
both 2000 and 1999 and $21 million in 1998.
..9 Performance
KFC is delivering quality products and good customer service by millions oI consumers
around the world. The main advantage the company Iacing is their working environment. By
creating better working environment it creates a better service towards the consumers. The
perIormance oI the organization is highly recognised by many consumers due to highly
publicity activities they undertake

.5 Stakeholders Analysis
a)Who are the key stakeholders?
Stakeholders Responsibilities
4.5.a.1 Shareholders
E Higher dividens, share price, assist and
proIits.
E Sound, well planned and implemented
growth strategy.
E Accurate and prompt Iinancial reporting.
E Prompt annual general meeting.
4.5.a.2 1oint Jentures & Franchise partners
E Fair dealing with parent company.
E ProIit maximizing

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4.5.a.3 Consumers
E Value Ior money KFC products
E Product or brand choice.
E Range oI products, good customer
service and distribution channel.
E KFC Ioods that will balance their health
awareness.
E Reliable KFC products.
4.5.a.4 Employees
E Job satisIaction.
E High wagers.
E Long term holidays.
4.5.a.5 Suppliers
E Management and knowledge transIer.
E Fair trading: reasonable price, business
reliability.
E Prompt payment and order processing
time.
E Long term growth rate.
E Price strategies.
E Sustained growth rate oI company.
4.5.a. Competitors
E High competition
E No misleading advertising or promotion
4.5.a.7 Covernment
E Prompt and accurate Iinancial reporting
and tax paying.
E Contribution to nation`s economic
indicates. (Eg. GDP).
E Good corporate citizens.
E Loyalty to legislation.
E Job creation and security to country
labour Iorce.
4.5.a.8 Local society
E Minimize environmental pollution.
E No excessive or cultural insensitive
advertising.
E Avoid wastage oI products and raw
materials.
E Good corporate citizen.
4.5.a.9 Banking and other financial
resources
E Company proIitability
E Financial resource.
b) What are their values?
E Shareholders: - high proIit margin.
E Customers: - high expectation oI the product such as quality, price and brand loyalty.
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E Employees: - Iriendly environment, Ilexible time schedule, reasonable salary, challenging
career.
E Suppliers:- Good reliable service
E Competitors: - value oI challenging higher rank competitors.
E Government:- government income (tax)

c)Their outside interests
The main outside interest are that the KFC seeking Ior is to create a better Iriendly environment
within the employees. This could be a great advantage to the consumers to increase much awareness
oI the existence oI the company. The other Iactor would be to create environment Iriendly company
which tend to minimize the environment pollution by using recycling products.

.6 Macro- Environmental Analysis
.6.1. Economic
The health oI a nation`s economy aIIects the perIormance oI individual Iirms and Industries.
Because oI this, companies study the economic environment to identiIy changes, trends and
their strategic implications.
The economic environment reIers to the nature and direction oI the economy in which a Iirm
competes or may compete.
Economic environment, that potentially positively or negatively aIIects the KFC`s ability to
conduct the business in local and the overseas market. .
E When consider the Mexican economy by year 2000 had stabilized and the GDP was
increased at an average annual rate oI 24 and unemployment had decreased to slightly more
than 2 percent. This economic condition better grow in KFC and other Iast Iood industries in
the Mexico.
E Mexican Peso is depreciated against US dollar because oI inIlation and higher interest
rates.


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.6. Social- Cultural
The socio-cultural segment is concerned with a society`s attitudes and cultural values.
Because attitudes and values Iorm cornerstone oI a society, they oIten drive demographic,
economic, political/legal and technological conditions and changes.
This case study, historically Iranchises made up a large share oI KFC`s international
restaurant base, because Iranchises were owned and operated by local entrepreneurs who had
grassroots understanding oI local language and culture.
"Attitude towards customer service" due to large number oI Ioods, services and considerable
number oI competitors in the Iast Iood industry, customers are Iaced with high variety oI
options; thereIore they demand a quality standard oI customer service driving to satisIy their
expectations. That causes changes in attitudes, belieIs, norms, customs and liIestyles and
culture. These Iorces strongly aIIect the way people live and help determine what, where, how
and when customers buy a Iirm`s products. Customers are increasingly demanding that
marketers behave socially-culturally responsible.
.6.. Political
This involves assessing the political environment oI the country/countries oI destination. It
includes such Iactors as the type oI government (e.g. democratic, authoritarian), the actions oI
the host country government (e.g. limits on the amount oI Ioreign ownership, subsidies), the
type oI economic system (e.g. capitalist, socialist), and the stability oI the government (e.g.
how long it has been in power).
W Political situation in Asia is not stable because oI that industry has to take risk to
invest money in Asian countries.
W With the setting up with World Trade Organization (previously named GATT),
countries are increasingly lowering down trade barriers. This will open up potential new
market. For example Mexico, one oI the markets Ior KFC had been lowering its tariIIs since it
had become a member oI GATT.
W Government rules and regulations eIIect to Iast Iood industry. Changes government
policies, changes in tax related laws on the industry.
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W North American Free Trade Agreement (NAFTA) had eliminated tariIIs on goods
shipped between Canada, Mexico, and the United State.
W Argentina, Paraguay, Uruguay, and Brazil signed a custom union agreement
(Mercour) in 1991 to eliminate tariIIs on trade among those Iour countries.
W Investors do not like to invest when countries have war, revolution and changers
government rapidly.

.6. Technological
Pervasive and diversiIied in scope, technological changes aIIect many parts oI societies. Their
eIIects occur primarily through new products, processes and materials. The technological
segment includes the institutions and activities involved with creating new knowledge and
translating that knowledge into new outputs, products, processes and materials.
.6.5 Demographic
The demographic segment is concerned with a population`s size, age structure,
Geographic distribution, ethnic mix and income distribution.35 As previously noted, the Iirm
analyses demographic segments on a global basis rather than a domestic-only basis.
As a USA and global market oI the KFC has to be very concern with those demographic
Iactors because slight change oI one Iactor could aIIect the whole market at once.
For example aging population oI most countries are increasing these days and new younger
generation is taking the world thereIore market is changing due to their needs and taste iI we
think that we do the same thing that we did during the post war period or baby boomers time it
is not going to work now. But the Iast Iood industry still mainly based on the baby boomers.
According to theCase study indicates that the Iast Iood industry mainly based on these age
categories such as baby boomers aged 35 to 50 constituted the larger consumer group Ior Iast
Iood restaurants. Generation Xers (ages 25 to 34) and the 'mature category (aged 51 to 64)
made up the second and third large groups who use Iast Iood in the country.

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5.0 Recommended Option
Our selection is to expand into Mexico and Puerto Rico, which is currently a growing market. The
obvious advantages shall be the close proximity to U.S., whereby KFC can maintain its standards, the
existing North America Free Trade Agreement (NAFTA), GATT and the availability oI cheap
workIorces and products. Operating eIIiciency in the restaurants is largely dependent on controlling
Iood and labor cost.

Another pull Iactor is that there is no competitors Irom the chicken segment, thereIore, can be
said as an untapped market. Being the Iirst mover, KFC will be able to establish a strong Ioothold
beIore other competitors enter the Mexico. First time customers remain usually remain strongly loyal
to pioneering Iirms in making repeat purchases. Making investment into Mexico, the government
allows tax brakes oI 5 years.

The world is divided in diIIerent regional markets (like Europe, Asia, Latin America, and
etc.). II a crisis happens in a speciIic country it tends to aIIect all countries within the same economic
region with which it has close economic relations. KFC should Iocus not only on Latin America` but
also in other markets. That way it can minimize possible economic crisis in one region with the
proIits oI another region.


6.0 Steps of Implementing the Option
Since KFC is a new company, it will be necessary Ior the Iranchisees to register Ior the business.

6.1 Organizational
The strategy to enter into Mexico and Puerto Rico shall be through Iranchising as avoid the
risk oI committing resources into an unIamiliar market. To grant Iranchises to only the highly
motivated, talented entrepreneurs with integrity and business experience and train them to become
active and aggressive owners oI KFC. A revision oI Iranchise contracts would need to be made to
protect KFC Irom having other KFC Iranchises in too close a proximity to one another and the
prevent Iranchisees Irom having sub standards. The traditional Colonel's way oI liIe philosophy
would be brought back into KFC\'s mission and goal statements to improve relationships and to
reduce management turnover and internal discontentment. Additionally, it is very important to have
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well trained marketing staII, with suIIicient knowledge oI the evolution oI the Mexico`s market,
Mexicans laws and regulations.

6. Product
KFC will increase their product line to include new menu items in various locations to test
acceptability and possible sales in relation to demographics. While expansion oI their menu is
necessary, they need to continue their Iocus on the "healthy Ioods" the domestic population is
demanding. They can do this by adding additional items such as oriental chicken dishes and grilled
chicken sandwiches and dinners.
6. Place
In this industry, distribution and new product introduction are the keys to success.
ThereIore, KFC shall expand into more nontraditional locations such as hospitals, gas stations,
convenience stores, malls, airports, concert halls, amusement parks, and college campuses. They will
need to implement new, culturally-speciIic procedures such as serving beer in German restaurants,
more Asian chicken dishes, Iamiliar dress in Asian restaurants, a pub-type atmosphere Ior European
restaurants with a leisurely atmosphere conducive to long conversations and others depending on the
Mexican`s culture.

6. Pricing
This will be a determining Iactor Ior the customer making their Iirst purchase. The price
should be set reasonably and competitively with other local restaurant oIIer chicken in their menu.
The price Ior the initial launch must be low. (ReIer to 6.5 Promotion)

6.5 Promotion
Promote all three divisional products combining ads and reducing costs Ior individual
advertisements. OIIer special introductory bargains Ior newly opened locations to get customers\'
attention. Continue with celebrity promotions oI KFC. Promote beneIicial societal programs by
continuing their neighborhood grant programs and expanding opportunities Ior more neighborhood
youths as they build new restaurants as an outreach and advertisement oI PepsiCo's traditional values
and "caring" attitude.


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6.6 Operational
Hire and train new employees in all areas including customer relations. KFC must deploy a
program that will create a more disciplined work Iorce. That can be accomplished by giving a bonus
Ior those that had high punctuality rates, good growth perspectives, etc. Prepare and test menu items
in restaurant and maintain high cleanliness standards. Increase eIIorts to improve work environment
Ior workers and customers such as implementing a smoke-Iree Iacilities policy oI all restaurants.

6.7 Financial
KFC needs the Iinancial backing oI PepsiCo to expand into the nontraditional locations and
Ioreign countries. Due to increased competition domestically, the Iinancial stability oI PepsiCo is
essential Ior KFC and the other restaurant divisions to expand into the nontraditional locations.
PepsiCo needs to increase the amount oI Iunds budgeted Ior employee training programs, community
betterment programs, and equipment Ior new Iranchises. They can still increase Iunds used to
promote beverages in their battle against Coke, but not concentrate all their monies in that direction.


6.8 Sustaining Competitive Advantage
Sustaining competitive advantage means to create unique service and product, which cannot be easily
imitated. This would include:
(a) International SO Standards
(b) Cleanliness oI restaurant
(c) Restaurant oI the year
(d) Unique advertisements
(e) Unique packaging
(I) Introduce new products Irequently
(g) Obtain Ieedback Irom customers and making modiIications to meet their needs





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7. Recommendations and Conclusions
Short-term recommenJutlonx:
Based on the analysis, we can conclude that they should start by solving their internal issues
such as management and restaurant menu beIore thinking about expanding. They should work
on the management issues to create a good atmosphere where employees are happy to work
in. I certainly do not believe that by treating employees poorly, a company can be successIul.
They also need to make sure that their restaurants oIIer a diversiIied menu, provide their
customers with quality Iood, excellent service and restaurant cleanliness. KFC should always
listen to their customers and try to Iollow the new trends on the market in order to Iully satisIy
their customers. Otherwise, competitors will satisIy them and will eventually outperIorm you
as Boston did with its grilled chicken.
Even though, KFC seems to have an emotional attachment to their original recipe that made their
success, they deIinitely need to move on and develop new products that customers want in order to
increase their Iinancial perIormance and value. We have seen that Boston and Popeye`s are stealing
customers away Irom KFC because they understood what customers wanted and started oIIering
healthier items. KFC should certainly do the same and enhance their menu.
Concerning their expansion strategy, KFC should start by closing a Iew non-proIitable stores in the
US that are currently drowning money Irom KFC. This will allow KFC to get the cash necessary to
invest in new markets, which oIIer more growth potential. We have seen that the US market is not as
attractive as it used to be, it has become saturated and certainly does not appear to have a bright Iuture
ahead. There is also the competition in the US that makes it really hard to compete in, whereas in
other Ioreign markets that are quasi untouched as I will discuss more in detail later. KFC has to select
countries based on their attractiveness and make sure that they can provide above-average returns,
which will be discussed more in detail in the intermediate term.
But Iirst, they need to have a clear vision, solve the internal issues and get some cash in order to make
sure that they are strong as a company and ready to compete internationally beIore going ahead with
their expansion project.
a. Create a great working atmosphere
b. Develop a healthier menu
c. Get some cash Irom selling unproIitable restaurants
d. Evaluate countries based on attractiveness
Concerning investing internationally, extremely attractive countries that can provide above-average
returns are regions that have chicken as traditional dish such as Asia and Latin America. Those
regions should certainly be prioritized while developing an international expansion. While they start
attacking those new markets, they should keep in mind to Iocus locally even though they go
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international in order to overcome certain barriers such as language, law and a good understanding oI
needs. Targeting new countries usually work better iI you adapt to the local market
ong 1erm recommenJutlonx
They need to stay close to their mission (provide customers with quality Iood, excellent service and
restaurant cleanliness) and make sure to know how to achieve their long-term objectives. They also
have to keep innovating and coming up with new items regularly. Remember that even though, they
come up with similar products, customers are most likely going to try them. They also have to Iollow
the trend and go hand in hand with customers to satisIy their changing needs, as we have previously
discussed with the current healthier Iood trend. They also want to keep an excellent image by treating
employees Iairly and keeping a good control over Iranchises to make sure they Iollow the company`s
procedures.
Concerning the American market, they should always keep an eye at competitors and see iI possible
mergers or acquisitions could be made. McDonald`s has been Iaster than KFC when they acquired
Boston, which could have really helped KFC regain its loss market share and reduce competition.
They also have to keep working on their low-cost/diIIerentiation strategy by better taking advantage
oI their competitive Iorces such as economies oI scales, bargaining power, image/brand worldwide
recognition.
Concluxlon
The global Iast-Iood market is competitive, with rivalry, substitutes, and the threat oI entry
presenting the strongest sources oI competitive pressure. Some country markets are more competitive
than others; however the U.S. Iast-Iood market high saturation so growth opportunities are
relatively lesser but still can grow considerably by oIIering Iranchisees to open more outlets.
Declining margins in the Iast Iood chains reIlected that increasing maturity in the Iast Iood industry.

We anticipate that, despite the inherent risks and generally higher general and administrative
expenses oI operations, we will continue to invest in key international markets with substantial
growth potential. As an alternative to domestic expansion, many restaurants began to expand into the
international market. Our selection is to expand into Mexico and Puerto Rico as the target market
niche is big enough to be proIitable and oIIers good growth potential. Franchising to build a presence
in Mexico and Puerto Rico without risking any resources. Being a Iirst mover will help KFC to build
up their reputation and image with the buyers.

The world is divided in diIIerent regional markets (like Europe, Asia, Latin America, and
etc.). II a crisis happens in a speciIic country, it tends to aIIect all countries within the same economic
region with which it has close economic relations; thereIore, our recommendations Ior the
international strategy will begin by Iocusing into Mexico and Puerto Rico.



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8.0 References

a. The Manager, http://www.themanager.org/Models/p5I.htm

b. PepsiCo, http://www.pepsico.com/investors/annual-reports/1996/Iinancial/page6.shtml

c. http://mba-lectures.com/marketing/swot-analysis-marketing/1107/swot-analysis-oI-
kIc-corporation.html.
d hLLp//wwwcourseworklnfo/unlverslLy/8uslness_and_AdmlnlsLraLlve_sLudles/MarkeLlng/kl
C_andLhe_Clobal_lasL_lood_lndusLry__70_L89419hLml

e. George E. Belch & Micheal A. Belch, 2001, ' Advertising and Promotion, McGraw-
Hill.

I. Kleindl, Brad Alan, 2001, 'Strategic E-Marketing: Managing E-Business South-
Western Publishing.

g. Susan Dann and Stephan Dann, 2000, 'Strategic Internet Marketing, John Wiley and
Sons.

h. Kotler & Armstrong, ' Principles oI Marketing, 9th Edition, Prentice-Hall, Inc,
Upper Saddle River, New Jersy.

i. Arthur A. Thompson. Jr. & A.J. Strickland III, 2003, ' Strategic Management, 13th
Edition, McGraw-Hill.
j. Subhash C. Jain, (2001), 'International Marketing, 6th Edition, South-Western
College Publishing.