Few restaurant executives are under more pressure than Micky Pant, CEO of Yum! Restaurants China.
By the end of this year, his company will be spun off as a franchisee and will begin paying a royalty back to Louisville, Ky.-based Yum! Brands Inc. It’s up to him to guide the once-high-flying KFC and Pizza Hut brands in China back to success in the wake of several years’ worth of food safety scares and errors in understanding the country’s changing consumer.
Adding to the challenge, Pant is replacing Sam Su, whose career with Yum was described in an analyst note from Paul Westra of Stifel as boasting “one of the most successful executive tenures in the history of the global restaurant business over the last 26 years.”
Not that Yum! Brands CEO Greg Creed, who returns to the Power List this year, has anything other than the utmost confidence in Pant. In a statement
announcing Su’s successor, Creed said, “[Pant] is one of our finest brand builders in the business.”
But Pant’s rebuilding job in China will interest many more people than just the leaders of Yum, which announced the spin-off in October to the praise of investors, including activist Keith Meister, who was named to Yum’s board last year after pushing for the China divestiture. A turnaround under Pant would ensure a steady income stream from China for Yum, without the volatility seen over the past three-plus years.
David Novak, executive chairman and architect of the China separation, told investors: “We’re not spinning off the ugly duckling. We’re spinning off the eagle.”
If Pant successfully turns around KFC and Pizza Hut in China, it could indicate that Yum and similarly growth-minded rivals, like McDonald’s and Starbucks, are better off going the “asset-light” route and letting local Chinese operators run stores, rather than take the capital-intensive step of building out a crucial market with company-owned restaurants. The next global growth markets, like India or Africa, might follow suit.
Yum proved over more than two decades that Western restaurant brands could dominate China with company-owned stores — and under Pant’s guidance, it may prove itself once again as a master franchisor.