Details
Mini Case Code : CLIBE028
Publication date : 2005
Subject : International Business Environment
Industry : Fast Food
Length : 05 Pages
Price : Rs. 50
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Key words:
Kentucky Fried Chicken (KFC), KRRS (Karnataka Rajya Ryota Sangha), Indian Prevention of Food Adulteration Act, 1954 (IPFAA), World Health Organization, US Food and Drug Administration, Swadeshi Jagran Manch
Note
* This caselet is intended for use only in class discussions.
** More comprehensive case studies are priced at Rs.200 to Rs.700 (US $5 to US
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Abstract
The caselet takes a look at the entry of KFC into India under the economic liberalization policy. It details the protests and agitations that the company faced that led to closure of its outlet. The caselet examines the reasons for these protests.
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Issues:
» Multinational food joints in India.
» Government’s stand on inviting MNCs in India.
» KFC in India.
» Economic liberalization in India.
Introduction
Foreign fast food companies were allowed to enter India during the early 1990s, thanks to the economic liberalization policy of the Government of India (GoI). One of the first fast food multinationals to set foot in India was Kentucky Fried Chicken (KFC), owned by PepsiCo.
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KFC received permission to open 30 new outlets across the country. It chose Bangalore as its launch pad because the city had a substantial upper middle class population, with a trend of families eating out. Also, it was considered India’s fast growing metropolis in the 1990s.
The Bangalore outlet was opened in June 1995. Apart from Bangalore, PepsiCo planned to open 60 KFC and Pizza Hut outlets in the country over the next seven years. However, KFC became embroiled in various controversies even before it started full-fledged business
in India...
Questions for Discussion:::
1. Since its entry in India in 1995, KFC has been facing protests by cultural and economic activists and farmers. What are the reasons for these protests?
2. Do you think in the light of fierce competition, it is justified for business organizations not to give importance to ethical values at the cost of making profits? Why or why not?