Although the drive-thru suburban restaurant is the bread and butter of KFC’s store portfolio, the Yum brand has big plans to increase its urban presence, starting in select markets. Starting in 2022, KFC is prioritizing an aggressive expansion strategy, particularly in cities like St. Louis, New York (Chinatown, Queens, and Harlem), and Baldwin Park, Calif.
When entering and expanding in these urban markets, KFC plans to build stores with a to-go format in mind, matching the on-the-go mentality or urbanites. There will likely not be drive-thru lanes, but stores will have in-store mobile pickup signs for both customers and third-party delivery workers to reduce customer friction. At these urban stores, they’ll also be testing digital menu boards and kiosks to add even more optionality for customers.
“As we optimize the order pickup flow within the restaurant, the consumer is able to come and just find their pre-packed product ready to go, hot and fresh with their name on it, and leave without going through the normal process,” Cahoe said. “Going forward, that type of digital integration that's tied into our ordering systems, inventory systems, operating systems, it's going to drive operational efficiency and speed that also then allows us to test the next generation technology for KFC.”
Over the next several years, KFC is planning to expand its portfolio with a number of type of formats, including the next gen urban stores, as well as transportation centers, and in-line shopping centers.
“We're starting to have more asset classes to help our expansion plans as we go forward,” Cahoe said. “We have significant runway for growth in the U.S., and we certainly believe we've got a path to growing another 1,000 restaurants so we get back to more than 5,000 KFCs in the U.S.”
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