KFC has been utilizing its limited-time menu by launching 3 chicken sandwiches over the summer and early fall 2019.
In July, the company released its Cheetos Chicken sandwich. In late August, KFC introduced the plant-based Beyond Chicken sandwich (okay, so technically it isn’t chicken), which sold out in a matter of hours (see our OM In The News post about it.). And in September, KFC introduced its KFC & Doughnuts sandwich—replacing the bun with doughnuts.
In all three cases, the items were/are available only for a limited time.
Video Spotlight: KFC debuts new chicken and donut sandwich
This post is based on the Washington Post article, KFC’s New Fried Chicken and Doughnut Sandwich Is Terrifying and Delicious, by Emily Heil, September 24, 2019; the Washington post article, KFC’s Cheetos Chicken Sandwich Looks Toxic and Tastes Like A Missed Opportunity, by Maura Judkis, July 17, 2019; and the YouTube video, KFC debuts new chicken and donut sandwich, by WCNC, September 18, 2019. Image source: Pixtal/AGE Fotostock
1. What Operations Management problems does a limited-time menu present?
Guidance: Limited-time menu items presents several problems from an operations management perspective. One is the need to establish suppliers and supply chain for these limited-time items. This represents extra work to find suppliers that may only be used for a short time. Another issue deals with inventory. How much inventory should be on hand? KFC obviously ran into problems with its Beyond Chicken sandwich. Inventory levels can be anticipated by good forecasting, but forecasting new products is very difficult. Another consideration is how the item is made. New processes will are needed and employees have to be trained. Hopefully, existing equipment can be used. For a limited-time item, investment in new equipment can be problematic.
2. What advantages does a limited-time menu offer?
Guidance: One of the big advantages of a limited-time menu is that it can generate excitement for the firm. All three of these limited-time introductions brought customer and media attention. Another advantage is that if KFC’s plan is to offer the new product for a limited time and they happen to run out early, it becomes part of the plan rather than simply running out like Popeye’s did with the introduction of its new chicken sandwich.
This limited-time menu approach serves as a way of test marketing new products. In addition to determining potential demand, the supply chain can be tested, including potential new suppliers, and any problems in delivering the product to the customer identified. Successful limited-time items can be considered for permanent inclusion on the menu.