Yum! to Bring Pizza Hut Franchise Back to SA and Africa
PIZZA Hut restaurants are set to return to SA, Keith Warren, the GM of the franchise’s owner, Yum! Africa, said yesterday.
Yum!, which also owns KFC and Taco Bell, is actively considering its options for bringing other brands into SA soon, Mr Warren said. “Pizza Hut is definitely a simpler sell in this country as pizza is already an established category. It did exist before so there will be some brand recognition and it seems like it is a natural progression for us,” he said.
“We have taken a hard look at it and it is a nice space to operate in. Pizza has developed as an offering and it is relatively inexpensive to make, and you can get a good gut-full — which is our trademark.
“We have a very large supply chain, probably bigger than all our competitors combined, so when we do turn our efforts to pizza we will be a formidable force.”
Mr Warren would be the best person to bring the brand to SA, having worked with the Pizza Hut brand for five years in Australia. “We will probably go head to head with Spur, as Pizza Hut will be a casual dining offer rather than delivery or take-away model ,” Mr Warren said.
Yum! is considered the world’s largest fast-food restaurant company with about 38000 restaurants in more than 110 countries. The company’s turnover in SA was about R8bn this year, Mr Warren said.
He said KFC was about four or five times bigger than its nearest competitor. “We see SA as a growth launching pad for us into Africa ; like many other companies, we see Africa as a beachhead.”
KFC has 640 stores in SA and about 45 in Africa. The company is hoping to grow this number to 850 in SA and 350 in Africa by the end of 2015. The company plans to open in five new countries next year.
“McDonald’s was one of the first global operators which came to compete with us in SA and they have had a tough time. Anyone coming into Africa to compete with locals has found it difficult, you have to be first in to get scale and be dominant ,” Mr Warren said.
“This strategy works, we have seen it in China and Europe. You have to get in fast, hard and with scale. That is why McDonald’s Corporation disinvested from SA this year — they were not getting the return they needed, they have taken that money and put it into their Russian expansion.”
Absa Securities analyst Chris Gilmour said Pizza Hut could do well on the gravitas of the KFC chain.
“Pizza Hut abroad has more of a casual dining approach rather than just a take-away culture and stands a better chance than McDonald’s, which has not done well so far. Even their Taco Bell chain could do well locally with no similar offering in SA ,” said Mr Gilmour. “There seems to be a grab for Africa, which makes sense with its growing population.”
ANNALEIGH VALLIE Published: 2011/10/05 07:58:20 AM