Chick-Fil-A Will Soon Be Expanding To Asia And Europe

Chick-fil-A, announced plans to break into new markets. The company plans to move into European and Asian markets with the first locations opening by 2026, according the Wall Street Journal. With a franchise model and simple menu, the privately held company has consistently outperformed poultry competitors like Kentucky Fried Chicken and Popeyes. When looking at sales, Chick-fil-A is the third largest fast food restaurant in the United States, only falling behind McDonald's and Starbucks. When looking at profitability per location, Chick-fil-A takes first place in the United States (via Insider). As far as the franchise model goes, Chick-fil-A plans to keep its current stipulations. The process is very selective, and after going through extensive training, franchise owners are only permitted to run a single location.

The American market is far from saturated, and in the similar cultural landscape of Canada, Chick-fil-A only has eight locations. However, chief executive Andrew Cathy told WSJ, "We feel like it's time to continue to innovate and try and test how we will do in international markets so that we can learn." The expansion plan is expected to cost around $1 billion dollars and result in the establishment of restaurants in five international locales by 2030.

How can Chick-fil-A expect to fare in international waters?

Kentucky Fried Chicken, for example, has had a presence in Asia since 1970 and now has more than 15,000 restaurants worldwide. In the 1,100 cities in China where KFC has locations, diners can expect the menu to change significantly to reflect the taste preferences of the region. This wisdom conflicts with what Chick-fil-A intends to do. Executives say that they may tweak the menu some, but not change it significantly. However, KFC gained traction because of its Western origins and reputation for freshness and cleanliness. Interestingly, in Japan, KFC is a traditional Christmas meal. This distinctly American experience still remains wildly popular. Chick-fil-A could be attractive for these same reasons.

The market for fast food is growing in Europe because of the increased demand for quick and affordable meals. However, the increasing importance that Europeans place on a healthy diet does inhibit the growth of that market. Perhaps Chick-fil-A's focus on quality ingredients with no trans fats or antibiotics will be appealing to Europeans.

Hopefully, Chick-fil-A's second foray into European territory will be received better than its first. In 2020, Chick-fil-A's United Kingdom restaurants quickly closed due to protests from LGBTQ activists, making the chain's first trip to Europe one of the biggest flops in Chick-fil-A history. In the meantime, Kentucky Fried Chicken remains the most popular fast-food chicken chain in Europe.