What are the fast food breakfast wars? An increasing number of fast-food franchises are making forays into the world of breakfast and they’re all looking for market supremacy. Taco Bell recently inaugurated a breakfast menu, featuring the waffle taco, a syrup-drenched, meat filled kind of breakfast sandwich, and Burger King, Starbucks and Jack in the Box have all also introduced new breakfast items over the last few months.
Why is China important? China has a vast middle class that will only continue to grow, making it the ideal spot for established brands looking to enter new, emerging markets and a crucial battleground for the breakfast wars.
China has long been a crucial contributor to Yum Brands revenue. The brand has 6,332 total restaurants, including 4,618 KFCs and 1,308 Pizza Huts. Yum Brands are increasingly dependent on the Chinese market for economic success. For example when China’s KFC’s suffered last year due to concerns over the bird flu it dragged the entire brand down. Furthermore, the Yum Brands plans to expand within the country. “Given the strength at both KFC and Pizza Hut, we expect to open at least 700 new restaurants in China this year as we further capitalize on our leading position in the No. 1 retail opportunity in the world,” Yum Brands CEO David Novak said in a statement.
In part because of Yum Brands success, McDonald’s is looking to get in on the action. In order to enhance their appeal in the country McDonald’s is working on revamping its entire image. The franchise is redesigning restaurants in Beijing, Shanghai and Guangzhou using a local designer and burger chain has added items with a more local appeal to the menu, including green tea ice cream this year and rice dishes last year. The franchise is also even recruiting an American star for China-focused commercials, with an upcoming LeBron James-centered ad campaign.
Who is winning the fast food breakfast wars? McDonald’s has historically dominated the breakfast market. The company has doubled its McCafe menu in recent years and in 2012 breakfast accounted for roughly $10 million in sales. That figure accounts for roughly one-third of all $37 million in breakfast sales in the entire fast food industry. However, the array of different franchises offering breakfast options could mean a challenge to McDonald’s supremacy. The bottom line is that whoever can gain a foothold in China will certainly have a leg up.
Article by Jason Duncan, CEO/Founder of ManagerComplete.com. ManagerComplete is an online software application that helps multi-unit franchises manage operations effectively. Follow him on Twitter for latest updates.