Kentucky Fried Chicken: Tackling the Trans Fat Problem


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Case Details:

Case Code : BENV012
Case Length : 12 Pages
Period : 2006-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : KFC Corporation
Industry : FMCG
Countries : USA

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Excerpts

The Campaign Against Trans Fats

Partial hydrogenation is an industrial process used for the hardening of oil. Hardening of oil is done because it not only increases the shelf-life of baked products, but also enables cooking oils to have a longer fry-life. Trans fats are produced during the hydrogenation process.

Over the years, public health organizations, consumer advocacy groups, and healthcare researchers have worked to spread awareness among consumers with regard to the link between foods containing trans fats and serious health diseases like coronary heart disease, type 2 diabetes, and obesity. Coronary heart disease was one of the leading causes of death in the US...

KFC's Search for a Suitable Alternative

According to KFC, the main challenge was to find a suitable cooking oil that would not only be devoid of trans fats but also preserve the unique taste of its fried chicken products. Also, the cost of the new oil would have to be similar to the hydrogenated oil that was being used. KFC had reportedly spent over 18 months and millions of dollars in this project, much more than that estimated by the top executives at KFC. Gregg Dedrick, President of KFC, said, "Every oil interacts differently with every food. To get everything right is not easy."...

Would A Ban on Trans Fats Help?

In December 2006, the New York City's Board of Health voted for a ban on artificial trans fats in food items served at all the restaurants and food outlets in the city. New York became the first major US city to come out with a regulation against trans fats. The phasing out of trans fats was to be implemented in two stages. Restaurants would have time till July 01, 2007 to ensure that all the oils used for frying would have less than 0.5 grams of trans fats per serving. By July 01, 2008, restaurants would have to ensure that all food items had to have less than 0.5 grams of trans fats per serving...

Exhibits

Exhibit I (A): Worldwide Sales of KFC
Exhibit I (B): KFC's Same Store Sales Growth in the US (Company Owned Restaurants Only)
Exhibit I (C): Average US Sales per System Unit (a)
Exhibit II: Trans Fat Content in Some of KFC's Menu Items Before and After the
Switchover to Zero Trans Fat Oil
Exhibit III: KFC's 'Zero Trans Fats' Online Advertisement


 

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