This morning Yum! Brands announced that they are launching the first KFC outlet via Yoma Strategic Holdings (YSH) in 2015.
After many false starts and even a much publicised taste test in May 2013 in Inya Lake Hotel by KFC together with the launch of a Myanmar Phantom KFC Facebook page – we are finally seeing KFC announcing their entrance into the Myanmar market. Yum! like so many American companies were hampered by the US sanctions that effectively prevents them from finding suitable local business tycoons who were on the US sanction list as partner.
Serge Pun of YSH is probably one of the very few tycoons in Myanmar that is not on the US Sanction List. This probably puts Yum! Brands at a disadvantage when it comes to searching for viable partner who own property in downtown Yangon and can pass the due diligence test that is required by the US Treasury’s Office of Foreign Asset Control (OFAC). The negotiation was probably even harder for Yum! Brands as they were not negotiating from a position of strength like they are used to in so many Asian markets.
We are encouraged that KFC finally made it to Yangon. For Colonel Sander it is never too late. It will be interesting to see where KFC will open their first flagship store as it is a challenge to look for a retail space in prime downtown locations that are greater than 5,000 sq feet in Yangon at the moment.
Author: Andrew Tan – Managing Director of Consult-Myanmar Co Ltd
Below is the joint press release by Yum! Brand and YSH:
Yum! Brands & Yoma Strategic to Bring First KFC to Myanmar
Singapore, 13 October 2014 – Yum! Brands, Inc. (NYSE: YUM), together with Yoma Strategic Holdings Ltd. (“Yoma Strategic”) today announced its intentions to bring the first KFC restaurant to Myanmar in 2015 with Yoma Strategic as its franchise partner.
KFC is one of the world’s largest restaurant chains, with $23 billion in global sales and more than 18,000 restaurants in 118 countries worldwide. KFC is among the first handful of quick service restaurants that have plans to enter the Myanmar market.
“The announcement of the first KFC coming to Myanmar reflects our ongoing strategy of global expansion in emerging markets,” said Micky Pant, CEO, KFC. “We’re excited to work with such a well-respected franchisee to bring the great taste of KFC to Myanmar, an important emerging Asian economy with a population of 50 million people.”
“Chicken is a staple protein in Myanmar and our people recognise the KFC brand and Colonel Sanders’ secret Original Recipe of 11 herbs and spices. KFC is a strong global brand that is now in nearly every corner of the world and we are proud to be KFC’s franchise partner to help fulfill its growth ambitions in Myanmar. Bringing KFC to Myanmar is an important step to achieving Yoma Strategic’s goal in being a key player in the country’s food and beverage sector,” said Mr. Serge Pun, Executive Chairman of Yoma Strategic.
Myanmar is one of the potentially sizable consumer markets to emerge among developing economies. With 50 million people and a growing middle class with disposable income, the country offers significant consumer opportunity for Yoma Strategic to grow KFC over the long term.
“Myanmar offers significant macro potential for an international quick service franchise with a growing consumer class that is forecast to grow from 2.5 million today to 19 million in 2030, potentially tripling consumer spending by more than threefold1. In a regional context, Myanmar should experience a strong growth trajectory,” said Mr. Pun. “The consumer and retail sector is key to Yoma Strategic’s strategy to capture the rapid increase in discretionary consumer spending in the country and KFC is the cornerstone of our business platform in this space.”
You may want to learn more about the challenge facing fast food brands entering Myanmar at Myanmar smells fast food success as KFC open in Yangon. & Is Food Delivery Business Viable in Yangon?