Why are American chains like Pizza Hut, Starbucks and McDonald’s experiencing fast growth and strong success in China?
Three key reasons: Strategic adaptations to the Chinese market and tastes, careful location planning, and adaptation to local cultural preferences in product and service design.
The Chinese have a great desire for goods and services they can trust. Although some Chinese competitors have entered the market with copycat fast food offerings, many Chinese still want the authenticity, consistency, and high quality of well-known Western brands.
This post is based on the Eater article, Why China Loves American Chain Restaurants So Much, by Clarissa Wei, March 20, 2018. Image source: Ingram Publishing.
Discussion Questions
1. How do the operations strategies of Pizza Hut differ in China versus in the United States?
Guidance: Whereas Pizza Hut is a relatively less expensive, casual, fast food eatery in the United States, in China it’s an upscale, date-night spot that often requires reservations. Thus, a focus on high quality and service is important in China, whereas in the U.S. the strategy is more focused on short processing time and low cost. This is true, interestingly, even though the standard of living and Continue reading
