QSR Brands reinventing KFC and Pizza Hut via new initiatives
PETALING JAYA: QSR Brands (M) Holdings Bhd, which operates the KFC and Pizza Hut chain of restaurant in Malaysia and neighbouring countries, has kicked off several innovative initiatives to reinvent the group’s household brands and grow its fast food business.
QSR Brands group managing director Datuk Seri Mohamed Azahari Mohamed Kamil said while the group would be looking to reduce its capital expenditure (capex) this year, it would not compromise on quality.
“We are trying to reduce capex as well as general and administrative expenses. We are adopting cost optimisation on all levels,” he told Starbiz.
“So far this year, we’re on track to achieve our budget.”
Azahari said the market had produced its fair share of challenges.
“But we’re coming up with new solutions to tackle the challenges. We’re having more promotions with limited time offers and if these are implemented successfully, we would be able to weather the challenges gracefully.”
One innovative way QSR Brands is growing its brand is to go beyond the food business, according to Azahari.
“KFC recently launched its limited edition ‘11 Finger Lickin’ Good Goods’ streetwear collection, in partnership with Pestle & Mortar Clothing. It was a sellout.”
The collaboration with the home-grown streetwear brand pays homage to KFC’S rich 46-year heritage in Malaysia, with 11 exclusive Kfc-inspired clothing and accessories.
In April, Pizza Hut, in partnership with Universal Music Malaysia, launched its “Singing Pizza” campaign, featuring pizza boxes that transform into music boxes that feature an exclusive music playlist with up to 200 songs.
“We want to be more than just a restaurant. We want to be a lifestyle store,” said Azahari.
He said the group has also tied up with a “renowned” gamification solutions provider to take KFC and Pizza Hut to the next level.
“The game is about education and we plan to use it to attract more Millennials to our outlets,” he said.
QSR Brands operates 824 KFC restaurants across Malaysia, Singapore, Brunei and Cambodia. It operates 472 Pizza Hut restaurants in Malaysia and Singapore,
“Locally, we serve 25 million customers a month at our KFC outlets and six million for our Pizza Hut stores. That constitutes the whole population of Malaysia,” said Azahari.
Going forward, the group is targeting to open 67 KFC stores and 60 Pizza Hut restaurants over the next three years in Malaysia.
“It’s ongoing and we’re on track and hopefully by year-end, we would have 30 new KFC outlets and 15 new Pizza Hut stores.
“This is excluding the new 50 stores we plan to open in partnership with Petroliam Nasional Bhd.
“We’re working with other oil majors to ensure that the brand is more distinctive in all areas, whether it’s in the suburbs, urban or city areas,” said Azahari.
He added that 30% of the new stores over the next three years would comprise drivethru outlets.
“The growth potential has always been in the drive-thru outlets because it attracts more crowds, especially during the weekends. Sales also tend to be higher at these outlets because they’re open 24 hours.”
Azahari also said QSR Brands would be focusing more on growing its delivery services.
“The delivery business is also very critical, which is why in the last two years, we equipped all of our restaurants with Wifi. In terms of accessibility, our outlets are also located within a five-km radius of any residential neighbourhood.
“Our strategy is to be both accessible and convenient to our customers.”
Azahari said QSR Brands has also tied up with mobile food delivery services company, Foodpanda, to provide its own halal delivery services.
“We’re the first to have a designated fleet of halal food in one food warmer that we don’t share with another non-halal product, which we deliver to all our customers. So, it would be a designated fleet only for halal delivery.
“Since partnering with them for over seven months or so, we’ve seen exciting growth in the delivery business. We’re hoping that within a year, all stores would have delivery services.”
Azahari is keeping mum on QSR Brands’ plans to relist on the local stock exchange.
“Our shareholders and the board have not come back to me and we are still waiting for them to give me direction and guidance on that matter,” he said.
QSR Brands was among the highly-anticipated initial public offerings (IPOS) this year after a drought of IPOS in the country last year. According to reports, the company, which was planning to list in the fourth quarter of this year, had decided to shelve its planned IPO indefinitely.
Citing sources, Reuters reported that QSR Brands had shelved plans for an IPO that could have raised as much as Us$500mil (Rm2bil) as potential investors viewed its valuations as too high.