Yum! Brands China restructuring a 'natural progression' for business, says Euromonitor
Euromonitor called the decision of Yum Brands splitting its China business into a separate company a "remarkable move".
Euromonitor International Head of Global Foodservice, Michael Schaefer said, "The decision by YUM! Brands to spin off its China business is both a remarkable move and a natural progression for the company. Remarkable given that even three years ago the idea of hiving off YUM! Brands’ China operations to unlock value elsewhere would have made little sense; natural given the company’s recent struggles."
"The Chinese fast food market combines vast sales and impressive growth with an unparalleled rate of evolution. Local operators continue to target global standards of quality and service, while product cycles continue to shorten as sophisticated consumers demand products that are both highly novel and tailor-made to Chinese palates. For Yum! Brands, these shifts came at a time when the company’s China operations faced unprecedented fallout from a series of food-safety scandals."
"The new corporate structure offers the company’s new China franchise partner an opportunity to reboot its brands, investing in innovation and logistics at a crucial point in the evolution of China’s consumer market. More broadly, the move is part of an ongoing shift in the global franchiser-franchisee relationship, with bigger, better-resourced, more-nimble partners vital to global brands looking to maintain expansion in the world’s fastest-growing regions."
