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KFC Touches Sore Spot of China's Food Processing Industry
US fast-food giant Kentucky Fried Chicken (KFC) launched its ?Mexican Chicken Roll? last week, following its recent new offerings such as Take-away Family Dishes, Sichuan Pickle, Sliced Pork soup and their rice dish with beans, mushrooms, carrots, corn and sauce. Before moving to full-scale marketing of the new dish, KFC undertook a week of test sales in selected outlets. It turned out that this chicken roll was very well received on account of its ?delicious and unique flavor.?

The Mexican Chicken Roll is somewhat like a Chinese spring roll. The chicken and lettuce, which make up its main ingredients, are given a dressing of Mexican salad sauce and pepper & yolk sauce then wrapped in pastry.

Before its launch on the Chinese market, it had been promoted in a number of other countries including Thailand, Japan, Singapore and the United States. All of these promotional campaigns turned out to be very successful. Now available in China, this chicken roll retails at 10 yuan (US$1.2).

However, there is a note of regret. Both consumers and producers are disappointed to note that the pastry used is imported across the Pacific from the USA. This is despite the fact that Chinese enterprises have a long history of producing this kind of pastry.

However, this strange state of affairs does not result from the quality of Chinese flour. Instead it resides in China?s non-industrialized processing techniques in the production of the pastry. Apparently none of China?s pastry manufacturers has so far invested in a production line capable of meeting the daily demand of almost 700 Kentucky outlets in China.

Another similar case dates back to last year?s ?potato crises? in Kentucky outlets across China with their practice of ?importing the potato flour from the United States instead of using potatoes homegrown in China.?

According to them, it is not the quality of Chinese potatoes that causes them to decline the use of local suppliers. They say the key reason for their strategy of importing American-produced potato flour is because they failed to find any competent Chinese food processing enterprises that can produce the potato flour in accordance with their strict quality standards. Another example of a stable and lucrative contract with KFC outlets lost to Chinese enterprise.

The reality of KFC?s use of imported pastry reflects once again the dilemma currently faced by China?s food processing industry.

Despite Chinese food?s first grade status in terms of its raw materials, production methods and flavor, most food production is still limited in scale. Processing takes place within a single enterprise so we see the techniques and equipment of batch production rather than mass production. This militates against modernization of the food processing industry in China.

Many Chinese enterprises that specialize in producing traditional Chinese food haven?t yet taken full advantage of the benefits of mechanized production. A prime example of this can be found right here in the pastry case. So far, no Chinese enterprise has thought of installing the modern equipment necessary for its mass production. It is this underdevelopment which can be blamed for China?s fast food industry lagging behind that of other countries.

Nevertheless, KFC has indicated that once China?s domestic enterprises are in a position to carry out the mass production effectively, they will consider using the local products. After all, they say the use of local ingredients could significantly reduce their production costs.

Some experts hope that after the lost business opportunities of the ?mashed potato? and ?pastry? cases, Chinese enterprises will wake-up to the realities of today?s fiercely competitive food processing industry. Once they do they will be in a position to save Chinese consumers from the embarrassment of having to enjoy imported mashed potatoes and pastry.

(china.org.cn by Feng Shu, July 17, 2002)


KFC Earns Two Billion Yuan Annually from China
Fast Food Market Foreshows Keen Competition
KFC Potatoes Take Their Lumps
Substandard US Potato Flour Rejected in China
No Mashed Potatoes at KFC Outlets in China
Breakfast is Changing from 'paofan' to Burgers
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